Merck to Market Stocrin for Less Than $1 Per Patient Per Day in Developing NationsMerck announced today that it will reduce the price of its antiretroviral drug Stocrin to less than $1 per day in the world's poorest countries, the Wall Street Journal reports. Stocrin, which is known generically as efavirenz, is used frequently in triple-drug antiretroviral therapy (Zimmerman/Schoofs, Wall Street Journal, 10/23). Stocrin is currently produced in 200 mg pills, with patients taking three pills once a day (Reuters, 10/23). Last year, Merck announced that it would offer Stocrin at a cost of $500 per patient per year to any government, charitable organization or employer in developing nations (Kaiser Daily HIV/AIDS Report, 3/13/01). However, Merck will now introduce a new 600 mg version of the pill at a price of 95 cents per day in developing nations. The new pill, which is taken once a day, would be 30% cheaper than the previous version of the drug (Reuters, 10/23). The new pill would also be cheaper than several generic versions of the drug. An annual supply of Stocrin at the newly reduced price would cost $346.75 per patient, while generic versions of the drug produced by Indian generic drug makers cost between $438 and $658 per patient per year. The price reductions will make Stocrin the cheapest version of efavirenz available in developing nations. Approximately 67,000 HIV-positive people in developing nations take Stocrin; more than 16,000 of these people live in sub-Saharan Africa. The new version of Stocrin has been approved in 17 countries but has not been approved in sub-Saharan African nations. Merck said that it expects many developing nations to approve the drug early next year (Wall Street Journal, 10/23).
Merck Says Lower Prices Part of Larger Strategy
In a press release, Merck stated that the price reductions are part of its "commitment to make HIV medications available in the developing world at more affordable prices." The company said that part of the reason the drug can be made available at lower prices is that improved manufacturing processes have cut production costs (Merck release, 10/23). AIDS activists welcomed the price cut but questioned whether the action was taken to coincide with the launch of the new once-a-day version of Stocrin in 52 countries. "It's always good to see the prices falling. It's a shame that it has to be timed with the product launch, which makes it seem like an effort to diffuse potential pressure," Rachel Cohen, a spokesperson for Doctors Without Borders, said. Cohen added that drug makers are beginning to "reac[t] to international public pressure and generic competition" by lowering the prices of patented AIDS drugs. Jeffrey Sturchio, a spokesperson for Merck, said that despite the drug's lower production costs, Merck will not make a profit on the new version of Stocrin in developing nations. He added that Merck's ability to offer Stocrin and other antiretroviral drugs at lower prices in developing nations depends on the continued profits resulting from sales of the medicines in wealthy nations. Merck's "catalog" price of the new version of Stocrin in wealthy countries is $8.55 per day, and in middle-income nations such as Brazil and China, the drug is being sold for $2.10 a day. An agreement between Merck and Bristol-Myers Squibb allows Bristol-Myers to sell the same drug under the brand name Sustiva in the United States and in some European countries. In the United States, the 600 mg version of Sustiva -- which has been available since February -- sells for $12 per pill. Sturchio said that Merck has implemented safeguards to ensure that the discounted drugs will not be diverted back to wealthier nations. The packages of the medicines destined for developing nations have "distinctive" green labels, and Merck requires proof of delivery when the drugs are sent directly to poorer countries (Wall Street Journal, 10/23).