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Thursday March 8, 2001

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Merck lowers prices of HIV drugs in developing countries

By The Associated Press

TRENTON, N.J. - Pharmaceutical manufacturer Merck & Co. announced it will drastically cut prices for two HIV drugs in AIDS-ravaged Africa and other developing parts of the world.

In a statement yesterday, the company said it will make no profit when selling the two protease-inhibitor drugs in developing countries. The drugs will be made available at about one-tenth of their U.S. price.

Merck and other drug companies have come under sharp criticism from various governments and relief groups, which accuse them of keeping patented lifesaving medicines beyond the reach of the world's poor.

"The reason we did this is we're trying to speed the process of access to these medicines," said Merck spokesman Greg Reaves. "We thought it would now spur other entities to get involved."

More than 25 million of the 36 million people infected with HIV live in sub-Saharan Africa, one of the world's most impoverished regions. Developing countries in other areas will be evaluated for the reduced-price program on a case-by-case basis, Reaves said.

Reaves said the company is looking in particular at "those countries where clearly the disease is most devastating, and also where economic conditions are devastating."

Merck, one of the world's biggest manufacturers of AIDS drugs, makes Crixivan and Stocrin, which suppress HIV levels in the body and can be used alone or drug combinations known as AIDS cocktails.

Crixivan, which sells for $6,016 per patient per year in the United States, will be sold in developing countries for $600 a year; Stocrin, whose U.S. equivalent Sustiva costs $4,730 per patient per year, will be sold for $500 a year.

Merck said the treatments will be available at a reduced price to governments, relief agencies and others who can provide them to patients, on the condition that the drugs be used only in the countries where they are sold.

Protease inhibitors, introduced in the mid-1990s, revolutionized AIDS treatment, transforming the disease from a death sentence into a manageable chronic ailment for many patients. The drugs typically are mixed with two other, older medicines such as AZT and 3TC.

Officials with Doctors Without Borders, the Nobel Peace Prize-winning relief agency, welcomed Merck's announcement but cautioned that the reduced price could still leave the drugs out of reach for many of Africa's AIDS patients.

"It's also important that the person on the street who is working, but whose employer isn't paying for it, can go and get them," said Toby Kasper, who works for the agency just outside Cape Town, South Africa.

The announcement comes amid a lawsuit in South Africa filed by a group representing many of the world's leading pharmaceutical companies, including Merck. The lawsuit by the Pharmaceutical Manufacturers' Association seeks to overturn a law that would allow the South African government to import cheap generic medications in an emergency. The pharmaceutical companies say these generics undermine their patents on the drugs.

Two generic drug makers in India - Cipla Ltd. and Hetero Drugs Ltd. - also announced recently that they will sell a cocktail of three AIDS drugs for a total of $600 and $347 respectively per patient per year.

Kasper said those announcements and bad publicity from the South Africa dispute gave Merck an incentive to drop prices now.

"It's only recently that people have understood what generics are and how they can be used," he said. "The companies have understood that very well, and that's why their prices are falling."

Bob Laverty, a spokesman for Bristol-Myers Squibb, also a leading maker of HIV/AIDS drugs, would not comment on whether the company also would categorically lower the price of its treatments.

Laverty said Bristol-Myers Squibb and Merck were among five drug companies that announced last May they would work with governments in Africa and other poor regions to sharply cut the overall costs of HIV drugs. Laverty said that agreements have been reached with Senegal, Uganda and Rwanda, and that the company expects more agreements in the near future.

GlaxoSmithKline, which also participated in the May agreement, announced a program Feb. 21 to reduce the price of three AIDS treatments in Africa, according to spokeswoman Nancy Pekarek. She said details are still being worked out. The drugs are not protease inhibitors.

Merck also announced yesterday that it will contribute $50 million over five years to the Botswana Comprehensive AIDS/HIV Partnership. The amount matches a contribution from the Bill and Melinda Gates Foundation.



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