Development & Aid, Headlines, Health, Latin America & the Caribbean, Poverty & SDGs

AIDS-BRAZIL: Gov’t Backs Down on Threat to Break Patent

Mario Osava

RIO DE JANEIRO, Aug 5 2005 (IPS) - Despite its highly publicised threats, the Brazilian government has decided not to break the patent on the antiretroviral drug Kaletra, a move that has disappointed and angered those who administer, sponsor and benefit from the country’s highly lauded HIV/AIDS treatment programme.

The threat of breaking drug patents to force big pharmaceutical corporations to lower their prices "has been discredited and no longer works" because the government has used this strategy too many times without following through, Renata Reis of the Brazilian Interdisciplinary AIDS Association (ABIA) told IPS.

Non-governmental organisations and networks of people living with HIV/AIDS have been pressuring the government to break the patent held by U.S.-based Abbott Laboratories for the antiretroviral drug Kaletra and produce it generically in Brazil. This would drastically lower the costs for the public health programme that provides HIV/AIDS drug therapy free of charge to everyone who needs it.

Brazil, with a population of 182 million, has been distributing free antiretroviral drugs – which slow down the body’s reproduction of HIV, the virus that causes AIDS – since 1996 through the National STD/AIDS Programme, widely recognised as one of the best anti-AIDS programmes around the globe, and particularly in the developing world.

But the programme’s costs continually rise because of a growing number of beneficiaries and the incorporation of newer antiretroviral drugs that must be imported at extremely high prices, owing to the exclusive patent rights held by the companies that manufacture them.

Brazil is able to produce its own generic versions of brand-name AIDS drugs commercially distributed before 1997, when it was obliged to respect patents on medicines as a requirement for joining the World Trade Organisation (WTO).

There are currently 160,000 people receiving free HIV/AIDS drug therapy in Brazil, and that number is expected to rise to 180,000 by the end of the year.

The costs of antiretroviral drug treatment totalled 621 million reals (260 million dollars) last year, an amount four times greater than in 1997. This year the Health Ministry predicts that costs will rise a further 52 percent, a fact that threatens to make the programme financially unsustainable.

A full 65 percent or almost two-thirds of the government’s antiretroviral budget is spent on just three of the 16 drugs distributed. Kaletra is one of these three, and it costs 2,628 dollars per patient annually in Brazil, which is five times more than in Africa, according to the Health Ministry.

In June, after more than three months of fruitless negotiations with Abbott Laboratories for a price cut on Kaletra, the Brazilian Health Ministry threatened to issue a compulsory licence to manufacture a cheaper generic version.

Invoking this measure would allow the government to have the drug manufactured in Brazil in return for a fixed royalty payment to Abbott, thereby saving 130 million reals (54 million dollars) annually, or 13.8 percent of this year’s total projected expenditures.

The WTO allows compulsory licences to be issued in cases of national health emergencies, based on the principle that public health prevails over private interests.

The measure is fully legal and frequently used even by the industrialised countries that most fervently defend intellectual property rights and the inviolability of patents.

The United States recently applied it to manufacture drugs to combat anthrax, in the face of a purported threat of biological terrorism, noted Reis, a lawyer by profession.

Brazil’s apparent determination to break the patent on Kaletra and produce its own generic version of the drug was welcomed as good news by Doctors Without Borders/Médecins Sans Frontières (MSF), an independent international medical humanitarian organisation that provides assistance to 35,000 people living with HIV/AIDS in numerous countries.

Second-generation antiretroviral drugs like Kaletra make treatment extremely costly, and generic production in Brazil would open up new prospects for all poor countries, noted Dr. Karim Laouabdia, director of MSF’s Campaign for Access to Essential Medicines.

But the Brazilian Health Ministry dashed the expectations of NGOs and people with HIV/AIDS by announcing on Jul. 8 that it had reached an agreement with Abbott Laboratories to lower the price of Kaletra in Brazil, thus ruling out the possibility of a compulsory licence and generic manufacturing.

The agreement does not specify a per-capsule price, but instead establishes that the government’s annual expenditures on Kaletra will remain at current levels for the next six years, even though the number of patients receiving the drug is expected to nearly triple in that time, from 23,400 to 60,000.

The announcement of the agreement provoked widespread criticism.

"The process was not transparent, the negotiations were carried out in secret, without listening to the people directly involved," said Reis, who represents the ABIA in a working group on intellectual property formed by a network of 40 NGOs.

Moreover, she added, the government’s STD/AIDS Programme will remain under potentially threatening financial pressure.

Nevertheless, Brazil’s new Health Minister José Saraiva Felipe, who was designated on Jul. 8, the same day as the agreement was announced, has not yet formalised it.

Both the Health Ministry and Abbott Laboratories have since stated that negotiations are still underway, without clarifying which aspects remain unresolved, or if a deadline has been set for reaching a definitive agreement.

In the meantime, "social organisations will continue to pressure the government to break the patent, which would benefit people living with HIV around the world," stated Reis.

Kaletra is actually a combination of two antiretroviral drugs already used separately, Lopinavir and Ritonavir, explained Dr. Juan Carlos Raxach, a physician and advisor to the ABIA.

The combination boosts the effectiveness of the two active ingredients, increasing the benefits while reducing unwanted side effects, he commented to IPS.

Raxach believes that the "excessive publicity" given to Kaletra when it was first launched resulted in the drug being overpriced and perhaps more widely used than it should be.

Prematurely modifying treatment by incorporating new drugs also entails certain risks, he added. These risks include cross-resistance, which occurs when a strain of HIV becomes resistant to more than one drug at once. As a result, some anti-HIV drugs will not work even if the patient has never used them before.