The U.S. Government Should Buy Gilead for $156Bn to Save Money on Hep C
At $500 per pill, buying Gilead could lower hepatitis C drug costs per patient to one-third their current level, making it affordable to rapidly treat the 2.7 million Americans that have HCV.
There is a unique intersection of a clear winning therapy, large public health need, slow adoption, high product pricing and attractive break-up valuations of the Gilead components compared to its conglomerate stock market valuation.
Buying the company rather than purchasing its products just works out to be a far cheaper route. Gilead’s market cap is around $100B. Paying the shareholders a 30% acquisition premium and assuming the company’s $26B debt would cost the U.S. government $156B.