[Ip-health] NGOs respond to Abbott $1000 Price for Aluvia

[B.Baker@neu.edu]

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NGO Response to Abbott=E2=80=99s announced $1000 price for Aluvia=0D
in Low- and Lower-Middle Income Countries=0D
April 10, 2007=0D
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Health GAP, Student Global AIDS Campaign, American Medical Student=0D
Association, and Essential Action applaud that Thailand=E2=80=99s compulsor=
y=0D
license, generic competition, WHO intervention, and activist pressure have=
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forced Abbott to offer a further 55% reduction in its tiered price for low-=
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and lower-middle income countries.  However, as clarified further below,=0D
the price discounts still do not go deep enough or wide enough, and Abbott=
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has still withdraw Aluvia and six other medicines from the Thai=0D
registration process in retaliation for Thailand=E2=80=99s lawful exercise =
of its=0D
right to issue compulsory licenses for priority medicines for government,=
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non-commercial use.=0D
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      Abbott=E2=80=99s new price announcement confirms the importance of ge=
neric=0D
      competition and the necessity of using compulsory licenses to curb=0D
      abuses of monopoly power by pharmaceutical companies. Abbott=E2=80=99=
s=0D
      price-discount announcement is mostly due to: (1) Cipla=E2=80=99s rec=
ent=0D
      announcement (April 1, 2007) to undercut Abbott=E2=80=99s price and o=
ffer=0D
      Aluvia at $1560/pppy, (2) Thailand=E2=80=99s decision to issue a comp=
ulsory=0D
      license in response to the unaffordable price charged by Abbott in=0D
      Thailand other low- and lower-middle-income countries of $2200/pppy,=
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      and (3) increased civil society and political pressure exerted upon=
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      the company in the last four weeks following its decision to=0D
      de-register seven medicines from the Thai market.=0D
      Abbott has not yet agreed to reverse its illegal and unethical=0D
      withdrawal of seven registration applications from the Thai drug=0D
      regulatory process, including the application for Aluvia, the=0D
      heat-stable form of Kaletra that is most appropriate for use in a=0D
      tropical country like Thailand.  Abbott may have violated Thailand=E2=
=80=99s=0D
      competition law by withdrawing these products; it has certainly=0D
      violated patients=E2=80=99 human right of access to essential life-sa=
ving=0D
      medicines.=0D
      Although this price is lower than what has been currently offered by=
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      generic manufacturers, it is still twice the access price of the=0D
      medicine(s) in least-developed and African countries ($500/pppy), and=
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      will exert a heavy financial burden upon low-income and lower-middle=
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      income countries seeking to achieve universal access and treatment.=
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      Abbott should provide Kaletra/Aluvia at one, no-profit price to all=
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      developing countries.=0D
      Although Abbott=E2=80=99s price is temporarily lower than the price o=
ffered=0D
      by generic manufacturers, it is highly likely that generic prices=0D
      will drop below $1000/pppy as an increasing number of patients=0D
      require 2nd line anti-retrovirals, as generic producers reach=0D
      economies-of-scale, and as generic versions of Aluvia are WHO=0D
      pre-qualified and are thus purchasable with Global Fund money.=0D
      Abbott=E2=80=99s price discount to Thailand, like its prior discount =
to=0D
      Brazil, is primarily designed to reduce market demand that might=0D
      incentivize efficient generic production.=0D
      Abbott must not be permitted to blackmail Thailand into withdrawing=
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      any compulsory licenses in exchange for a promise to renew its=0D
      registration application for Aluvia.  Thailand=E2=80=99s decision to =
issue=0D
      compulsory licenses was fully consistent with World Trade=0D
      Organization intellectual property rules and obligations and with=0D
      Thai law.  Likewise, the Ministry of Health should not be forced to=
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      withdraw its compulsory licenses for efavirenz or Plavix.=0D
      Even if Abbott is offering a lower price for Kaletra/Aluvia, it does=
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      not necessarily mean that Thailand should withdraw, or not execute,=
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      its government use license.  There are strong reasons that Thailand=
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      may wish to keep its compulsory license to ensure alternative sources=
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      of supply, to develop and support domestic and/or regional=0D
      pharmaceutical capacity, to incentivize generic competition, and to=
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      subsequently procure lower-priced generic versions that are=0D
      WHO-prequalified and registered in Thailand.=0D
      Thailand should only purchase Kaletra/Aluvia from Abbott to ensure=0D
      no-stock outs and reliable access across the country, and should not=
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      enter into any long-term, binding contract that would make Abbott the=
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      country=E2=80=99s sole supplier for multiple years and preclude futur=
e=0D
      use/access of generic versions.  A prior decision by the Brazilian=0D
      government to enter into a long-term contract with Abbott for=0D
      Kaletra/Aluvia has exerted a severe financial burden upon the=0D
      National AIDS treatment program, and the Brazilian government now=0D
      pays a price of $1596/pppy that is 60% higher than Abbott=E2=80=99s n=
ew $1000=0D
      price.=0D
      The World Health Organization should be staunchly defending and=0D
      supporting Thailand=E2=80=99s decision to issue a compulsory license,=
 and=0D
      should be providing technical support and assistance to the Thai and=
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      other governments to enforce and implement compulsory licenses.=0D
      Any price negotiations conducted by the WHO should be done alongside=
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      and through national governments, and not done secretly with=0D
      pharmaceutical companies.  Any price negotiations or transactions=0D
      with the pharmaceutical industry should be open, transparent and=0D
      inclusive to avoid any appearance of impropriety or undue influence=
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      of the pharmaceutical industry upon the UN body.=0D
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Sponsors of this statement are seeking additional sign-ons.  Contact Brook=
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Baker:  b.baker@neu.edu 617-373-3217