BRAZIL SHAKEDOWN - highly detrimental to drug innovation longer term.
wire story as follows:
Roche, Brazil Make Deal on AIDS Drug
RIO DE JANEIRO, Brazil (AP) - Brazil withdrew its threat to ignore patents and start making a generic version of a powerful AIDS (news - web sites) drug Friday after a Swiss pharmaceutical giant promised to slash prices by 40 percent.
Health Minister Jose Serra, who last week said Brazil would start producing a generic version of the drug Nelfinavir at a state-owned laboratory, announced a last-minute agreement had been reached with the Roche group.
Roche, based in Basel, Switzerland, confirmed it agreed with the Brazilian (news - web sites) government to cut the price of the drug by 40 percent next year in exchange for continued patent protection.
``We are pleased that after lengthy negotiations we have reached this agreement with the minister of health which is acceptable for both parties,'' said Ernest Egli, president of Roche Brazil.
A statement from Roche also said it would start local production of the drug - marketed in Brazil under the trade name Viracept - early next year.
Serra said the agreement will make it cheaper for Brazil to buy the drug from Roche than to make it domestically. The price reduction will Brazil about $35 million a year, the Health Ministry said.
Brazil has slashed AIDS deaths with a free-of-charge treatment program. Nelfinavir is part of the free ``cocktail'' of AIDS drugs that the government offered to some 90,000 patients last year.
The annual number of AIDS deaths in Latin America's largest country has fallen from 11,024 to 4,136 in just four years.
The agreement came after six months of negotiations between Roche and the government. Serra had announced last week that the talks had failed and said Brazil would start to make a generic version of Nelfinavir.
Brazil has used similar tactics with other drug companies. In March, New Jersey-based Merck agreed to reduce prices of two AIDS medications by 70 percent, and Roche had previously cut the price of Nelfinavir in Brazil by 34 percent.
Earlier this year, the United States dropped a complaint with the World Trade Organization (news - web sites) over clauses in Brazil's intellectual property law that require drug companies to begin manufacturing the drug in-country within three years after the patent is issued, or risk losing it.
The law also contains clauses that allow patents to be stripped in cases of national emergency or when the company has been judged to employ abusive pricing. Serra cited the abusive pricing clause when he said Brazil would start making a generic version of Nelfinavir.
Currently, Brazil spends about $88 million a year - 28 percent of its $303 million anti-AIDS budget - on Viracept every year. About a quarter of Brazil's AIDS patients use the drug.
Brazil has the highest number of AIDS cases in Latin America, with about 210,500 people suffering from the disease. |
