Why are people complaining about the cost of innovative COVID treatments?

Gilead Sciences just announced it will charge $3,120 for a full course of Remdesivir, the first new FDA-approved treatment for COVID-19. Some knee-jerk members of Congress like Lloyd Doggett (D-Tex.) immediately condemned that price tag as “outrageous.” And the Institute for Clinical and Economic Review, a left-leaning nonprofit that releases its own recommendations of “fair” drug prices, claimed that Gilead could afford to price Remdesivir as low as $10 per course of treatment — the cost of the raw ingredients used to make the drug.

Ignorance is not bliss. These critics couldn't be more misinformed. Gilead priced Remdesivir lower than the drug's actual value. And while it's no silver bullet, it's currently our best hope of saving hospitalized patients and reducing strain on our hospitals -- a particularly important goal in light of the surging case counts in many states.

Remdesivir isn't a vaccine. It prevents the virus from replicating within the body. In a Phase III clinical trial, patients who received Remdesivir recovered 31% faster from COVID-19 than those who did not, a decrease from 15 days to 11 days.

Of course, developing Remdesivir wasn't easy or inexpensive. By the end of 2020, Gilead will have spent $1 billion doing so. The firm began development in 2009, originally intending to use the antiviral to treat Ebola. That enormous investment of time and money helps explain Gilead's price. Just like any business, it needs to recoup its investment costs.