Medicines for all, not just the rich
March brought bad news for the HIV virus, but good news for HIV/AIDS patients, particularly those in poor countries. In the second week of the month, Merck and Co., a leading US pharmaceutical manufacturer, announced it would slash the prices of two of its antiretroviral drugs, indivar (Crixivan) and efavirenz (Stocrin), by 90% to US$ 600 and US$ 500, respectively, per patient per year. The price cuts would be extended, Merck said, to all developing countries provided they could guarantee that the low-cost drugs wouldnt be re-exported.
At about the same time, another drug firm, GlaxoSmithKline, which produces 40% of the worlds anti-AIDS drugs, said it would make cut-price AIDS drugs available to any not-for-profit organizations with the capacity to deliver themin developing countries. And the ball kept rolling: yet another US pharmaceutical manufacturer, Pfizer, announced it would distribute the antifungal drug fluconazole (Diflucan) used to treat AIDS-related meningitis and fungal infections free of charge in South Africa up till December 2002.
Then on 15 March came an offer by the New York-based pharmaceutical company Bristol-Myers Squibb to reduce the prices of two of its antiretroviral drugs, stavudine (Zerit) and didianosine (Videx), to a combined price of US $1 per day and to relax its patent protection over Zerit in South Africa. The offer would allow South African-based drug companies to produce and market the drug at low cost. The surprise announcement followed protests fromstudents at Yale University in the United States where stavudine was developed. The university holds the patent for this drug and allows Bristol-Myers Squibb to produce it on licence.
What triggered this price avalanche? Certainly, the curtain was raised on this new scenario by the dramatic February offer of the Indian drug company Cipla to sell governments a cocktail of three antiretroviral drugs for US$ 600 a year a fraction of the US$ 10 00015 000 price tag for this triple therapy in the United States and other countries in the west. Certainly, Ciplas offer turned the focus from country-by-country negotiations to across-the-board price reductions aimed at the poorest countries. And for sure, these reductions are part of a broader process which combines pressure from nongovernmental organizations, political will, market forces and close collaboration between the pharmaceutical industry and international organizations to make wider access to AIDS medicines a reality. Meanwhile, another Indian manufacturer of generic drugs is reportedly offering triple antiretroviral therapy for US$ 350 a year.
This is not about profits and patents. Its about poverty and a devastating disease, said Mr John L. McGoldrick, executive vice president, Bristol-Myers Squibb. We hope our initiatives can be of some help to African AIDS sufferers and may help energize and accelerate world understanding and action.
Ciplas offer catapulted it into the centre of an international squall over the production of low-cost copies of expensive AIDS drugs, since it is far fromclear which countries can import and sell generic drugs without breaking existing trade agreements granting exclusive rights to patent-holding companies.
The squall is fuelled, among other things, by mounting international concern over the high price of many essential drugs but especially antiretroviral drugs for the treatment of HIV/AIDS which puts them beyond the reach of the poorest countries where they are needed most. Of the over 36 million people living with HIV/AIDS, less than 10% have access to lifesaving drugs. Of the 25 million Africans living with HIV, only around 10 000 currently receive proper medical care.
Under an international trade agreement known as TRIPS an acronymfor Trade Related Aspects of Intellectual Property Rights new drugs can be patented for up to 20 years. This gives manufacturers exclusive marketing rights throughout that period at a price set by them. However, under exceptional circumstances in the event of a national emergency, for example TRIPS allows signatory states to pass national laws enabling them to bypass patents and to produce or import cheaper versions of a patented drug.
Taking advantage of this possibility, the South African government passed a law in 1997 that enables it to import cheaper versions of AIDS drugs for the 4.7 million South Africans now living with HIV/AIDS. The law has never been enacted because in the following year the pharmaceutical industry initiated legal action to overturn it on the grounds that it is too broad and contravenes international trade agreements. The action has culminated in a high-profile court case due to start in April in the South African capital, Pretoria, with 39 international pharmaceutical companies challenging the South African government.
In a press statement, the International Federation of Pharmaceutical Manufacturers Associations (IFPMA) warned that any loss of patent protection would threaten research and that price reductions would do little to improve access to AIDS drugs unless national governments and donors increased funding. The IFPMAs director general Dr Harvey Bale Jr said: The international pharmaceutical industry firmly believes that the weakening or infringement of intellectual property rights as reflected in the international trade agreements amounts to a disincentive for investment and research and development, and that factors other than intellectual property rights are at the root of the problems of access to medicines.
The Geneva-based World Trade Organization agrees that ways must be found to improve access to essential drugs in low-income countries but maintains that drug companies must be given incentives to develop new drugs, which can each cost as much as US$ 500 million to produce. Were it not for a patent systemthat rewards companies for risking millions on research, Mr Mike Moore, director-general of the World Trade Organization, wrote in a recent editorial in the International Herald Tribune, anti-AIDS drugs would not exist.
The British charity Oxfamis campaigning for a change in world trade rules to drastically widen access to essential drugs. Mr Kevin Watkins, Oxfams senior policy adviser, maintains that differential pricing by the pharmaceutical companies on a product-by-product and country-by-country basis is too limited and not the answer. What is needed, he told the Bulletin, is a system of differentiated patents, with improved safeguards built in to ensure that the public interest comes first and corporate interest second.
Oxfamargues that public investment and international cooperation not extended patents should be used to finance research. The charity is calling for a US$ 5 billion international fund to be established, under the auspices of WHO, to support a global network of public research institutions dedicated to developing new medicines and vaccines. Oxfam also wants to see an international fund established to subsidize drug purchases and delivery systems in the poorest countries.
In Norway this month (April) about 50 experts from around the world are meeting at a workshop organized by WHO and the WTO to discuss differential pricing as a means to ensure that the poor have access to essential drugs without undermining the international patents system a system that gives pharmaceutical manufacturers an incentive to develop new drugs.
However, even at heavily discounted prices, many drugs still remain way beyond the means of low-income countries. WHOs director-general, Dr Gro Harlem Brundtland, says that no matter how low prices go, additional funding in the form of development assistance and debt relief will be needed to meet the costs of care for the poorest: The private sector is showing it is willing to do its part to fight the HIV/AIDS epidemic. The onus is now on governments and international organizations to make sure the funds to pay for these drugs are made available and that health systems are strengthened so that they are able to provide the care needed. We are talking about a 500-fold increase in care that could translate to as much as US$ 10 billion per year. This is a great challenge for all of us.