Biotech and Pharma

Gilead may face legal action if it doesn't cut prices: Mass. AG

Drug companies can't bankrupt states: Mass. AG

Massachusetts Attorney General Maura Healey has warned Gilead Sciences that it could face legal action if it doesn't reduce the prices of its Sovaldi and Harvoni medications.

In a letter to Gilead CEO John Martin, Healey suggested the costs of the two hepatitis C drugs "may constitute an unfair trade practice in violation of Massachusetts law."

"I write to encourage you to reconsider Gilead's pricing structure for Sovaldi and Harvoni ... so that we may actually see this infectious disease eradicated in the United States in our lifetime," she wrote, adding that her office will "continue to examine this potential claim for unfair commercial conduct."

A full course of Sovaldi currently goes for $84,000, and a 12-week Harvoni treatment costs $94,500.

Healey wrote in her letter date Friday that that if Massachusetts were to purchase Sovaldi at its retail price for all of the people with hepatitis C in the state's prisons, then the costs would "easily exceed" the entire budget for prisoner health care.

After word of the price increases for specialty drugs including Sovaldi, Democratic presidential hopeful Hillary Clinton announced she planned take action against skyrocketing drug costs.

Gilead has said it is committed to expand access to its medicines, regardless of ability to pay. The company has said it offers a "support path" for those who may have trouble paying for its therapies.

"We agree with the Attorney General about the importance of helping all HCV patients — and that the advent of safe, effective regimens means we can now consider the possibility of eradicating the disease," a Gilead spokeswoman told CNBC, adding that the company had reached out to Healey about setting up a meeting to discuss the issue.

"We look forward to working with the Attorney General's office to address questions and concerns and ensure a mutual understanding of the work we are doing to deliver a cure for HCV to as many patients as possible in Massachusetts and around the world," she added.

CNBC obtained a copy of Healey's letter after its contents were reported Wednesday by The Boston Globe.

—CNBC's Meg Tirrell contributed to this report.