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Gilead Sciences this month curtailed its drug reimbursement program to HIV clinics across the nation, prompting one national HIV activist to predict “financial disaster” for community programs that provide PrEP medications to uninsured patients.

Blogger Mark S. King reported it’s estimated local clinics providing Gilead PrEP drugs Truvada and Descovy will lose “hundreds of million dollars per year” now that as of Jan. 1, the drugmaker stopped giving the reimbursements for uninsured patients.

Stephen Fallon, executive director of Wilton Manors-based Latinos Salud, which provides HIV services at three locations in Miami-Dade and Broward counties, said those most affected by the cutbacks will be among the most vulnerable.

“The people who are most impacted by the HIV epidemic in South Florida are Latino and African American. And usually gay,” he said. “They were not getting on PrEP. They were not even hearing about PrEP from their practitioners and you can imagine all the reasons: Some clinics don’t feel like a safe space for you to talk to your practitioner about any slip-ups you may have had, or even what your sexual identity is.”

Now Fallon is worried. 

“Because we are able to give these free services and free labs in a place where people feel culturally at home and safe, we're getting so many people on PrEP,” he said. “Without the funding, we have less room to serve that many people.”

Clinics across the nation, including South Florida, relied upon the Gilead reimbursements to help pay for programs, staffing and other daily expenses.

“For patients with insurance who receive the medication … purchased at the discounted price, the insurance company reimburses that pharmacy at a rate based on the undiscounted cost of the medication,” King wrote Nov. 16 in his award-winning blog, My Fabulous Disease.

Fallon added: “The long-standing practice has been that the pharmacies that filled prescriptions for PrEP would then send a portion of that ‘sale’ [called a rebate] to those HIV agencies that were serving the most distressed communities. Those agencies would then invest that rebate in any programs or resources that would improve patient access and healthcare.” 

Fallon explained that now the pharmacies no longer receive any funds from Gilead if the patient was uninsured. 

“So there’s no rebate to send on to the HIV agencies for those patients,” he said. 

Philadelphia Gay News explained the process on Nov. 30: “HIV clinics that serve a high percentage of low-income or uninsured patients acquire PrEP at discounted prices and provide the drug to patients for free. Under Gilead’s [original] model, clinic pharmacies are reimbursed for the wholesale value of the prescription that they purchased at a much lower cost.”  

PGN made clear that the reimbursement change was not part of the federal government’s 1992 drug pricing law known as 340B, which allows clinics treating uninsured and low-income patients to buy pharmaceuticals at steep discounts.  

“Gilead’s provision of a free drug program is separate and distinct from our participation in the 340B program, which is unchanged by this update,” a spokesperson told PGN.  

In May 2019, the U.S. House Committee on Oversight and Reform examined Gilead’s pricing for Truvada, which at the time had no generic equivalent.  

“In 2012, the FDA approved the use of Truvada for PrEP, a daily pill that prevents the transmission of HIV,” the committee reported. “In the United States, Truvada is currently sold at a list price of approximately $2,100 per month, generating $3 billion in revenue for Gilead in 2018 alone.”  

The Food and Drug Administration first approved Truvada in 2004 as an HIV treatment drug, and eight years later as a preventive. The brand name drug costs $1,600 to $1,800 a month. The first Truvada generic became available in the U.S. in 2020 and in May 2021 became more widely available at lower cost, reported POZ magazine and  

Shortly before the widely available generics became available, Gilead announced that effective January 1, 2022, it would change its reimbursement program for uninsured patients.  

“It will have an effect on organizations that previously depended partly on these savings to help fund the care and treatment of their clients, and also provide additional services,” said Patrick Whiteside, executive director of Prevention 305, an organization that provides sexual health services in the South Florida area including free PrEP, nPEP, condoms, HIV or STD testing.  

Whiteside said Miami-based Prevention 305 sees hundreds of clients each month and that more than half are uninsured, which will cause the organization to lose that extra funding.  

It will take more than creative bookkeeping to shift budget dollars to make up the lost revenue. 

“Many grants do not allow you to use grant money for medication and oftentimes care and medical services,” Whiteside said.  

Fallon of Latinos Salud tells a similar story. 

“Roughly half of our patients are uninsured. While they'll still be able to get free medication through the patient assistance program, since there won't be any rebates coming on those patients, we will therefore lose half of the money that we use to pay for our nurse practitioners, our lab screenings, our increased space for clinical testing rooms. And more.”

Journalist Steve Rothaus covered LGBTQ issues for 22 years at the Miami Herald. @SteveRothaus on Twitter.


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