[Ip-health] Glivec price cut by Government was revoked by Court

[Heesob Nam]

http://www.tradingmarkets.com/news/stock-alert/nvs_south-korean-court-oks-pricing-of-novartis-anti-leukemia-drug-720347.html

SEOUL, Jan 22, 2010 (AsiaPulse via COMTEX) --

A Seoul court on Friday said the price of Gleevec, an anti-leukemia
drug developed by Swiss pharmaceutical
firm Novartis, is not "unreasonable," ruling in favor of the drugmaker
in a years-long battle with the local government over the cost of the
medicine.

Last September, the Ministry for Health, Welfare and Family Affairs
notified Novartis of its decision to reduce the price of Gleevec to
19,818 won (US$17.3) per capsule from 23,045 won, the initial price
agreed to by the government and Novartis under a deal reached in
January 2003. The move came one year after a group of civic activists
and patients appealed to the ministry, complaining that leukemia
patients were forced to pay up to 2 million won per month for the
medicine.

Following the ministry's notification, the Swiss pharmaceutical giant
filed a suit with the Seoul Administrative Court, seeking to nullify
the government's move to lower the price.

"As Gleevec's upper-ceiling price was set as the average price of the
drug in the seven most advanced countries, including the United
States, it is hard to conclude the price was considerably
unreasonable," the court said in its ruling.

Gleevec is used to treat patients with chronic myelogenous leukemia
(CML), a form of blood cancer in which the body produces too many
abnormal white blood cells. The deadly disease afflicts about 500
people in Korea each year, according to the ministry.

Major foreign pharmaceutical firms and the Korean government have
battled over the pricing of several other essential drugs. Civic
groups say that charging the same price in Korea as in the world's
richest countries is unfair considering that per capita GDP is a lot
higher in those countries.

The health ministry said it will review the ruling and decide whether
to appeal the case or not in two weeks.

"This ruling is a regrettable decision as it could set a bad precedent
in nullifying the ministry's administrative order," a health official
said.

Novartis said it respects the court's decision, declining to elaborate further.

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Heesob