Global AIDS drug prices have much more to do with struggles over patent than with ACT UP and other US AIDS activist orgs, just as big race and class gaps in infection rates, mortality rates, etc. in the USA have much more to do with economic inequality, lack of single-payer health care, the "war on crimes" (which has led to "[r]oughly one-fifth of black adult males in the United States" having served time ["New Perspectives on the Social and Economic Contexts of HIV/AIDS Infection," Focus Vol. 24, No. 3, Fall-Winter 2006, <http://www.irp.wisc.edu/publications/focus/pdfs/foc243f.pdf>]), and so on than with ACT UP and other US AIDS activist orgs.
In response to the threat of cheap generic drugs, especially from producers in Brazil and India, pharmaceutical companies have opted to negotiate with each government individually, offering different discounts, restrictions, etc. to each (an old divide and conquer approach), forestalling concerted attacks on patent in this sector (and beyond it). Governments in the South weigh the costs of life-saving drugs and the benefits of market access to the North (most find the latter irresistible).
<http://www.boston.com/news/world/articles/2007/01/03/drug_costs_imperil_brazil_aids_fight?mode=PF> Drug costs imperil Brazil AIDS fight
By Indira A.R. Lakshmanan, Globe Staff | January 3, 2007
RIO DE JANEIRO -- A decade after Brazil became the first developing country to guarantee free AIDS treatment to every citizen, the spiraling cost of new drugs is threatening to bankrupt the highly effective program.
Tens of thousands of patients who have survived for years have become resistant to old antiretroviral drugs that are widely available in cheap generic form. High prices for the new medicines have driven the country's spending on AIDS drugs up 75 percent over the past two years.
The government has negotiated hard with pharmaceutical companies, receiving the lowest prices outside of Africa for many brand-name antiretrovirals. But even with discounts, new antiretrovirals cost as much as $17,000 per patient per year in Brazil. Old generic drugs cost hundreds of dollars per patient annually.
The soaring prices have sparked a national debate over the sustainability of the taxpayer-funded program and over Brazil's right to begin making generic copies of critically needed medicines. A battle is brewing among activists, health officials, and pharmaceutical companies that will have global implications for intellectual property rights and the future of AIDS treatment in rich and poor nations alike.
AIDS activists say that ballooning drug prices must not be allowed to undermine a free, universal drug program that inspired Thailand, Uganda, and other nations to provide free antiretrovirals. Coupled with aggressive prevention efforts, including condom distribution to prostitutes and needle hand outs to drug addicts, Brazil's program slashed annual AIDS deaths in half to 11,000 in 2005, the latest year for which government figures were available.
It was a dramatic turnaround from the early 1990s, when Brazil's epidemic rivaled South Africa's, where 20 percent of adults now have the disease. Today, only 0.6 percent of the adult population is infected in Brazil -- a prevalence rate lower than in the United States. Through universal drug treatment, Brazil cut HIV-related hospitalizations by 80 percent in 2006, when compared with 1996, and saved a cumulative $1.7 billion in hospital costs over the past decade, officials say.
Activists and leaders of Brazil's pharmaceutical industry are pushing the government to cut burgeoning drug costs by making generics of drugs that are still under patent. Under a 2001 World Trade Organization declaration, any country may copy patented drugs if its government deems it necessary to protect public health.
Big multinational drug makers have fought to avoid "licensing," under which a government pays royalties to the makers to copy a drug. African nations have issued licenses, but pharmaceutical giants argue that Brazil is a middle-income country and should pay its fair share.
As the most populous nation in Latin America, "Brazil is so big that if they take a stand . . . others like Venezuela, Argentina, and Bolivia might follow," said Guillaume Corpart-Muller, an analyst for InfoAmericas, a business intelligence firm with headquarters in Miami.
"They could lead a movement," he added. "And that's pretty scary for manufacturers of branded drugs."
The Brazilian government has resisted licensing, fearing reprisals not only from pharmaceutical companies whose drugs they may not have the know-how to replicate but also from the countries in which the companies are based. The United States has trade regulations allowing it to retaliate against any country imperiling the business of a US company. If Brazil produced generics of patented US drugs, Washington could conceivably block Brazilian imports or suspend tariff waivers to the tune of billions of dollars.
The result has been an uneasy truce between Brazil and the pharmaceutical industry. Companies say they have given Brazil the best prices they can while making a return for investors. But advocacy groups are pressuring the government to skip the bargaining and follow India, China, and South Africa in making generics before treatment becomes unaffordable.
For most patients here, the government program is a critical lifeline.
Lucas Castro Santana contracted HIV when he was 13, he believes, from a dirty needle used to etch his initials onto his arm in a cheap tattoo. Now 18, Santana depends on four daily medicines for survival, including a patented drug. With a monthly income of $118 for six people, his family could never afford the $455 monthly cost of his pills.
"If I had to pay for it, I'd be dead already," the bone-thin youth said recently while waiting for prescriptions at a north Rio hospital.
Veriano Terto Jr., executive director of the Brazilian Interdisciplinary AIDS Association, said he worries that unless Brazil starts making its own drugs, rising prices could put the government program out of business and send patients like Santana back into hospitals.
Activists are fighting to block new patents for minor changes to formulas -- a process known as "evergreening" that allows drugmakers to renew expiring patents -- and are calling for parallel imports from countries that pay less for AIDS drugs or make generics. They have filed a lawsuit against Brazil's government and US pharmaceutical giant Abbott Laboratories, which slashed prices of its antiretroviral Kaletra in 2005 -- just as Brazil was on the verge of issuing a license to copy it.
Abbott intends to increase Kaletra's price in Brazil by 10 percent in 2007, because the drug will be offered in two daily tablets rather than three capsules -- and thus is considered a new product. The government complains that Kaletra already costs Brazil $16.3 million annually; Abbott counters that Kaletra is the cheapest effective drug of its class sold in Brazil.
Company spokeswoman Jennifer Smoter said Abbott fought Brazil's plans to license a generic copy because "we rely on what we get from the sale of our medicines to help foster the inventions of the future." In order to give Africa the drug at the cost price of $500 a year, she explained, the company needs to charge a higher price elsewhere.
Just one new drug -- Enfurvitide, manufactured by Swiss pharmaceutical Roche -- cost Brazil $17 million last year for just 1,000 of 175,000 patients in the program, health officials say. With 15,000 more people beginning general treatment every year, drug costs will only rise.
An hour's drive from downtown Rio, state-owned drugmaker Farmaguinhos has a new factory. Director Eduardo de Azeredo Costa says the government has a duty to taxpayers and patients to issue licenses to national laboratories to produce generics and research new drugs that could save tens of millions of dollars.
"People are fighting for their lives and are entitled to the best possible treatment," said Mariângela Simão, director of the National AIDS program. But she acknowledged the state "can be more selective in the future about new drugs, once there's evidence that they're better than other, older ones."
Lakshmanan can be reached at lakshmanan at globe.com. -- Yoshie <http://montages.blogspot.com/> <http://mrzine.org> <http://monthlyreview.org/>