Consumers, Activists ‘Fed Up’ with High Cost of HIV/AIDS Drugs
With prescription drug prices increasing, pharmaceutical companies face a wave of "resentment" that has "boiled over into the American mainstream," and has placed companies' "fat" profit margins "at risk," Forbes reports. In the United States, drug prices have reached staggering levels -- AIDS-fighting protease inhibitors, for example, cost about $14,000 per year, $12,000 more than manufacturing costs -- rendering pharmaceutical firms "inevitable prey for anticapitalist legislation." Hoping to quell voter concerns, lawmakers this fall passed a drug reimportation bill, the Medicine Equity & Drug Safety Act of 2000, which allows pharmacists and wholesalers to import from abroad pharmaceuticals that meet federal safety standards. While Congress approved the measure "over the dead bodies of the pharmaceutical industry lobbyists," Forbes calls the legislation "just the opening wedge." The "popular revolt" against pharmaceutical companies began with protesters, such as ACT UP, a group that wants affordable AIDS treatment in the United States and less expensive drugs for African nations. To counter opposition, the drug industry has moved to improve its image in the "court of public opinion." Bristol-Myers Squibb, for instance, provided a $100 million grant for clinics and research to help stop the spread of HIV in sub-Saharan Africa, and Pfizer has offered to provide Diflucan, a drug used to treat meningitis -- a disease that often afflicts AIDS patients -- which costs $10 per pill in the United States, free to South Africans for two years. In addition, Glaxo Wellcome has offered Combivir, a patented AZT/3TC combination that costs $8 per pill in the United States, for between 70 cents and 90 cents in developing countries. While Forbes calls the provisions for poorer nations a "humanitarian gesture," the magazine warns that eventually "uninsured, unprosperous" U.S. patients also will want the "humanitarian" rate. According to drugmakers, pharmaceutical firms that offer less expensive drugs to poorer nations recoup their "billion-dollar" research outlays from American consumers. That argument, however, remains a tough sell for lawmakers, leading Forbes to conclude, "Here come price controls. There goes the R&D budget." The India Factor Some activists in other nations have already moved to stop pharmaceutical firms from charging high prices through compulsory licensing laws, which allow foreign governments to ignore U.S. patent protections "when the health or safety of a nation is at risk." Under compulsory licensing, generic manufacturers may produce patent-protected drugs in exchange for a fee. In India, for example, Yusuf Hamied, CEO of Cipla -- a company that produces ingredients identical to those in drugs developed by multinational drug firms but sells them for 5% to 10% of U.S. market prices -- is on a quest to "revolutionize" the industry. Cipla plans to supply AIDS drugs at "reasonable profit" over production costs. For instance, Hamied has offered to provide d4T, a Bristol-Myers product that reduces viral load in HIV patients and costs $4.50 per pill, to Ralph Nader's Consumer Project on Technology for 10 cents a tablet. He also has proposed providing a free year's supply of Nevirapine, Boehringer-Ingelheim's $8-a-pill drug that helps prevent vertical HIV transmission, to leading AIDS hospitals in South Africa. Paraphrasing Indira Gandhi, Hamied said, "My idea of a better ordered world is one in which medical discoveries would be free of patents and there would be no profiteering from life or death" (Lenzner/Kellner, Forbes, 11/27).This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.