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Abbvie Expects $3B In Hepatitis C Drug Sales And 40% Of Insured Customers

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Abbvie , the maker of one of the costly hepatitis C pills captivating Wall Street and frustrating those who pick up the tab for its $1,000-per-pill cost, says first-year sales of its treatment will be more than $3 billion in 2015.

AbbVie’s Viekira Pak was approved last month and, like rival treatments sold by Gilead Sciences (GILD), has faced resistance and coverage restrictions from private health insurers and government health programs like Medicaid plans for poor Americans.

But Abbvie chief executive officer Rick Gonzalez said he expects Viekira to have access to 40 percent of the “covered lives,” which is industry jargon for access to patients with health insurance coverage. Of the covered lives with access to hepatitis C treatments, Gonzalez said 20 percent of the patients will come from "exclusive" contracts Abbvie has negotiated with health insurance drug plans and pharmacy benefit management firms like Express Scripts (ESRX). The deals are with a mix of government and private insurers, Abbvie confirmed.

“We feel good about the early days of our launch,” Gonzalez told analysts and investors on a 70-minute conference call this morning to discuss Abbvie’s fourth-quarter 2014 and full year earnings as well as the company’s 2015 forecast.

Gonzalez indicated competition for cutting deals with health plans and PBMs has been fierce, but negotiations are “unfolding in weeks rather than months.” In the Express Scripts deal, Gilead drugs are excluded from the PBM’s preferred list of drugs in favor of Abbvie’s Viekira. Gonzalez said it has also taken 20 percent of the exclusive “covered lives” through the Express deal and additional arrangements with insurers like Blue Shield of California and other “regional” health plans.

Though Express Scripts hasn’t disclosed the lower price it negotiated with Abbvie, it’s reportedly significantly below Viekira’s $83,000 list price for a 12-week course of treatment. The discounts have come after Gilead priced Sovaldi at $84,000 for a 12-week course of treatment. Gilead’s more recently launched hepatitis C pill, Harvoni, is even more expensive, listing for $94,500 for 12 weeks of treatment.

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