Switzerland taking on drug companies over high hep C drug prices

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For a rich country that is a global hub for pharma companies, Switzerland is going to extraordinary lengths to avoid hepatitis C patients having to pay for pricey drugs.

According to a Swissinfo report, despite attempts at gentrification, Zurich’s infamous Langstrasse – or long street in English – remains one of the seediest places in the city. Sex shops and brothels abound and small groups of alcoholics sip beer at noon, oblivious to patrolling police cars. It is an appropriate location for Arud, a centre to help drug addicts and alcoholics. And, the report says, Arud has become the epicentre of a coordinated effort – unprecedented in Switzerland – by doctors, regulators and health insurers to make it affordable for hepatitis C patients to access expensive drugs by bending the rules.

The report says many of the drug addicts that walk through Arud’s doors also suffer from hepatitis C, a viral disease that affects between 50,000 to 80,000 Swiss residents. Only those suffering from a very severe form have the drug needed for treatment covered by their mandatory health insurance. The brand-name drugs (sold as Sovaldi, Harvoni or Epclusa) manufactured by US pharmaceutical Gilead costs between $34,048 to $61,713 for the 8-12-week therapy.

However, around half of the country’s patients only have a moderate form of hepatitis C which means they have pay for the treatment out of their own pockets. That has led many to buy generic versions of the drug – manufactured under license in countries like India – online or by travelling abroad. The generic drug costs a fraction of the hepatitis C medicine manufactured by Gilead, however, the report says, patients have to run the risk of buying fakes or substandard products.

“We decided to write guidelines for how patients can safely access generic drugs because there are many suspicious vendors online,” Philip Bruggmann of Swiss Experts in Viral Hepatitis (SEVHep) based at Arud, is quoted in the report as saying.
One of the main recommendations of SEVHep to uninsured hepatitis C patients is to source the generic drugs from an Australia-based buyers’ club FixHepC, which procures and tests the medicines.

“So far, we have accompanied around 70 patients who have used Indian generics and they were all cured. It works as well as the drugs that can be bought in Swiss pharmacies,” says Bruggmann. He says Swiss patients are third largest buyers of hepatitis C drugs from FixHepC buyers’ club, after the UK and New Zealand. “The approximate number of Swiss clients we have delivered to so far is 154,” the report says a representative of FixHepC said.

The report says following the publication of Bruggmann-led SEVHep guidelines for sourcing generic hepatitis C medication, extraordinary things started to happen: like a change in policy on importing medicines into the country.

Under Swiss law, a person can legally import a month’s worth of medicines. This was primarily for the benefit of tourists and visitors who needed to bring essential medicines with them during their stay in the country. However, the loophole is often used by Swiss residents to import a wide range drugs from painkillers or Viagra that are purchased online for a fraction of Swiss prices. Packages containing more than a month’s worth of drugs are confiscated by customs and recipients charged a minimum of CHF300 in administrative costs.

The report says in an unprecedented move, Swissmedic – the Swiss medicines regulator – decided in November 2016 to make an exception for hepatitis C drugs, and allow imports of up to three months’ worth of drugs instead of just one. “It is not an official policy but a case of offering flexibility for hepatitis C drugs. It makes no sense to have a one-month limit when the treatment requires three months of medications,” Swissmedic spokesperson Danièle Bersier, is quoted in the report as saying.

The report says Gilead strongly objects to this flexibility on Swissmedic’s part. “It is very concerning that they allow this from a patients’ safety point of view,” says Peter Hüssy, director of Gilead’s Swiss Hepatitis business unit. “The drugs could have been left outside for five days under the sun in India. Nobody knows and has control over how these imported medicines have been handled, transported or stored,” he says.

And it is not just Swissmedic’s actions that have made importing generic hepatitis C easier. The report says as of February 2017, Swiss health insurance company Concordia, included hepatitis C in its supplementary health insurance plan for its clients that reimburses up to 75% of the cost of drugs imported from the FixHepC buyers’ club. Like Swissmedic, they were also influenced by SEVHep’s guidelines.

“We decided to cover hepatitis C because not all patients could procure the drugs for a good price and we had good contacts with SEVHep to ensure patients are well-informed,” says Matthias Steiner, manager of the hepatitis C project for Concordia. The company even waives this cost for hepatitis C sufferers who can’t afford it through its charitable foundation.

“I think it is an example of finding pragmatic solutions when there are political and economic constraints,” says Bruggmann. “It could be used to put pressure on the system and might make companies lower drug prices”.

But is it ethical for residents of a rich country like Switzerland to use low-priced drugs meant for poorer countries, the report asks. Gilead, which has voluntarily licensed their drugs to 11 Indian manufacturers and allowed their sale in 101 developing countries, claims that importing generics into Switzerland is a misuse of their intentions to provide access to less developed nations. “What we want is to not endanger these programmes. It is best if everyone sticks to what has been agreed,” says Hüssy.

The report says surprisingly, both campaigners for cheaper hepatitis C drugs and pharma companies like Gilead are in complete agreement over one thing: The Swiss Federal Office of Public Health should offer access to drugs to all patients and not just those suffering from an advanced stage of disease. “It still takes a lot of effort for patients to go through the Australian buyers’ club. It would be much easier for them to get the medication from their doctor or pharmacy,” says Bruggmann.

The government has recently shown signs of softening its stance on paying for treatments. In April, plans were announced to make it easier for high-risk patients like drug addicts, as well as HIV and hepatitis B sufferers, to access Gilead’s drugs even if the disease is only in an intermediary stage.

The report says perhaps Australia could serve as a model for Switzerland on how to achieve universal access. It began offering hepatitis C drugs to all patients from December 2015 as part of plan to eliminate the disease within a generation. Australians managed to negotiate attractive prices for their drugs thanks to a unique volume-based price approach where the price drops when more people are treated.

“We are continuously working with the Federal Office of Public Health on the issue unrestricted access to our hepatitis C treatments and would be willing to discuss prices if Switzerland embarks on an elimination plan for Hepatitis C,” says Hüssy from Gilead.

However, even with the best deal making Gilead is not going to sell its hepatitis C drugs as cheaply as generics, the report says. Prices will still be high but a 12-week hepatitis C treatment almost guarantees a cure rate of at least 90%. Hence, in theory it offers better financial value than HIV treatments for which Switzerland does offer universal access.

Swissinfo report

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