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Anti-AIDS drug price cut of little use to South Africa - TAC
The Mercury. 29 April 2003. Republished courtesy of Independent Newspapers (Pty) Ltd.
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GlaxoSmithKline (GSK), the world's largest maker of anti-AIDS drugs, said on Monday that it had cut the price of its leading Combivir treatment in poor countries by 47 percent to under $1 (about R7,20) a day.
The move is the latest sign that the international pharmaceutical industry is bowing to pressure to improve access to life-saving antiretroviral medicines in Africa and other parts of the developing world where HIV/AIDS has hit hardest.
Activists have recently been joined in demanding such action by leading investors, who fear a failure to respond adequately could damage their companies' reputations and jeopardise future profits.
But in South Africa, which, with about 4,7 million people infected has the highest HIV/AIDS caseload in the world, activists said the company's price cuts did not go far enough.
Nathan Geffen, a spokesperson for the Treatment Action Campaign, said the move would have little impact because the South African government had so far refused to provide AIDS drugs in public hospitals.
"The bad thing is that this still doesn't apply to the private sector, and that is the only place where most South Africans can get their antiretrovirals at the moment," he said.
South Africa's HIV/AIDS crisis would continue to worsen until there was full competition with generics, he added.
The company's second price cut in seven months brings the cost of Combivir to governments, non-governmental organisations and many employers down to $0,90 (about R6,50) a patient a day from $1,70 (about R12,30).
The medicine - a combination of AZT and 3TC - is central to many triple-drug therapies that have made HIV infection into a manageable condition in the West, but are largely unavailable in developing countries.
The price for the two component drugs, when sold separately, will also come down by 38 percent and 45 percent respectively.
British-based GSK, which has stated in the past it would not sell anti-AIDS drugs at a profit in the developing world, said the price cuts were made possible by continuing improvements in manufacturing processes and economies of scale.
Industry critics were sceptical of this.
"Glaxo may say they have found some new way to bring down the price, but it's kind of funny when you consider that two years ago generic companies had already figured out how to make it at a much lower price," said Daniel Berman of Medecins Sans Frontieres.
Berman said any price reduction was welcome, and cheaper Combivir would be a particular help in those countries where generic products were not available.
But GlaxoSmithKline's medicine remained more costly than generics, with India's Ranbaxy Laboratories offering the same treatment at $0,73 (about R5,30) a day in a tablet approved by the World Health Organisation, he said.
Equity analysts said the move would not have any financial impact for the company. UBS Warburg estimates its sales of anti-HIV drugs to the developing world are under £40-million (about R460-million) a year, or less than 0,2 percent of group revenue.
Richard Feachem, executive director for the Global Fund to fight HIV/AIDS, tuberculosis and malaria said GlaxoSmithKine's move was another step towards expanding access of antiretrovirals to millions of people who needed them.
"This must be matched by increased resources to finance the purchase of medications," he said in a statement.
Despite steep price cuts for poor countries in recent years and competition from generics, combination therapy remains out of reach for the vast majority of those in the developing world.
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