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Action needed to tackle the second wave of the AIDS drug pricing crisis

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In July 2005, the Group of Eight (G8) committed to universal access to treatment for AIDS by 2010. Global action is needed now to ensure the affordability of the medicines needed - both those that exist today, and those that will be produced in the future.

Rio de Janeiro/Geneva - Urgent action is needed to ensure a continuous supply of affordable AIDS medicines to those who need them, said Médecins Sans Frontières (MSF) at the Third International AIDS Society conference in Rio de Janeiro.

Some first-line antiretrovirals (ARVs) are still unaffordable in many countries; treating children can cost four times more than treating adults; and newer, second-generation AIDS medicines are up to 12 times more expensive than older drugs. The current system of AIDS drug pricing is clearly failing patients in developing countries.

MSF calls on governments to use all means at their disposal to decrease the prices of life-extending treatments for the poor.

"It was generic production that brought down the prices of AIDS drugs from over US$10,000 to as little as US$150 per patient per year," said Ellen 't Hoen, Director of Policy Advocacy with MSF's Campaign for Access to Essential Medicines, in Rio today.The Changing Landscape of Intellectual Property Rights. Presentation at the IAS conference, Rio de Janeiro, July 2005

Successful national AIDS programmes in Brazil and Thailand were possible because key pharmaceuticals were not patent protected and could be produced locally at much lower costs. Local production in India, Thailand and Brazil had effects far beyond the borders of those three countries.

"But after hard-fought progress, we are now seeing the "second wave" of the AIDS drug pricing crisis: the prospects of competition are diminishing because of patent rules," 't Hoen said. "We need bold action from governments such as Brazil, who have the capacity to produce essential medicines at affordable prices. Compulsory licensing offers a perfectly legal solution for countries to protect public health - it enables local production and reduces drug prices in a sustainable way."

This is particularly important as originator companies have shown very little willingness to further lower the prices of their AIDS drugs in developing countries, despite requests by international organisations such as UNAIDS and the World Health Organization.

MSF has first-hand experience trying to access existing ARVs at discounted prices given to some countries by companies.

"Although it has some benefits, differential pricing simply doesn't work for all those who need ARVs," said Fernando Pascual, MSF pharmacist presenting the results of an MSF pricing survey at the conference.Cost of scaling-up HAART for low- and middle-income countries. Results of a survey conducted in MSF projects. Poster presentation at the IAS conference, Rio de Janeiro, July 2005. See also: Untangling the web of price reductions: a pricing guide for the purchase of ARVs for developing countries. 8th edition. MSF, July 2005. 8.pdf

First, medicines only available from one single producer are still very expensive. For example, the differential price accorded by GlaxoSmithKline for abacavir is over US$800 per patient per year.

Second, prices announced by pharmaceutical companies are often not available in reality, because companies have not registered or marketed the drugs in countries eligible for differential pricing. For instance, Gilead's Viread (tenofovir) is fully registered in only six of the 95 countries where the company offers it for a differential price.

Third, some companies do not offer discounts to middle-income countries - this is the case of lopinavir/ritonavir (Kaletra, manufactured by Abbott Laboratories) in Thailand, Latin America and Ukraine, where MSF programmes pay US$4,000 to 6,000 per patient per year for this one drug alone. To put these prices in perspective, MSF currently pays less than US$250 per patient per year for WHO-prequalified first-line triple combinations sourced from Indian generic producers.

Following the full implementation, as of January 1, 2005, of the World Trade Organization's (WTO) Trade-related Aspects of Intellectual Property Rights (TRIPS) Agreement in India and other developing countries not yet granting pharmaceutical patents, access to affordable new drugs is expected to become more difficult. From 2005 onwards, all new drugs are subject to at least 20 years of patent protection practically everywhere except in least developed countries.

Patent rules may also hamper the development of fixed-dose combinations - the three-in-one pills that have helped simplify patients' lives - when patents on the different compounds are held by different companies. Although these pills are currently what approximately 70% of all MSF's patients take as first-line treatment, patent rules in India will make such combinations difficult, if not impossible, to produce in the future.

In July 2005, the Group of Eight (G8) committed to universal access to treatment for AIDS by 2010. Global action is needed now to ensure the affordability of the medicines needed - both those that exist today, and those that will be produced in the future.