E-DRUG: Merck on the Brazilian move towards CL efavirenz
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[sorry for the flurry of messages about first India, then Thailand and now Brazil, but it is in my view important for all E-druggers to understand how the drug companies react to efforts by developing countries to make use of the "flexibilities" in the WTO/TRIPS agreement as confirmed by the Doha Declaration. As we have several moderators, the previous message was posted erroneously twice. Here is the response by Merck, translated from a radio programme in portuguese. Wilbert Bannenberg, moderator]
Agência de Notícias da AIDS - 26/ABRIL/07
For Merck, patients and the country lose with de declaration of "public interest" of efavirenz
25/4/2007 19h20
In an exclusive interview to Agência de Notícias da Aids, the corporative communication director of Merck Sharp & Dohme João Sanches affirmed that "not only the pharmaceutical industry or Merck lose" with the declaration of public interest of efavirenz done by the Ministry of Health, through the decree published in this Wednesday, 25, in the Official Union Diary. "I think that everybody loses. Patients and the country as well" said the executive. He comments that the news was a surprise for the company, because they were in the middle of a negotiation process with the Brazilian government and reaffirmed the "unequivocal" commitment of Merck to try to find a solution for AIDS. However, he highlights that to keep doing research "is important to have a safe environment for investment and a return for the shareholders and for the people who are investing in this way". Read the full interview.
Agência Aids: What is Merck' position about the decree published today in the Official Diary declaring the "public interest" of efavirenz?
João Sanches: It was a surprise for us because we are still in a process, and we understand that we are in the middle of a negotiation process. I dont have a lot to say because we are exactly in the middle of the process. From our point of view, we are sure and expect that the Brazilian government does not issue the compulsory license because we do not believe that this is a solution neither for patients, nor society, and neither for the country nor for the pharmaceutical industry as a whole.
Agência Aids: According to the decree, one of the reasons for the government taking this action was the fact that no agreement was achieved with Merck for the price. The government proposal was the adoption of the price set in Thailand, of US$ 0,65, and the Merck' proposal was a discount of 2% of the current price, which is US$1,59. Why such a small reduction? Why the industry is so intransigent in the negotiations?
João Sanches: I think it is important to look at the historical process of this discussion. In 2003, we gave two discounts to the Ministry: a discount of 17% and, right after, because of a negotiation, we gave an additional discount of 25%, as we recognize that Brazil is a country with an excellent treatment AIDS program and that give access to all patients, because all our policy is corporate, it is global, and based on access. As a result of these two discounts, the efavirenz price in Brazil is the lowest in the world and is still currently the lowest all over the world, for countries which have medium HDI (Human Development Index) and prevalence lower than 1%, which is the case of Brazil, that is classified in the global access policy established by Merck together with other pharmaceutical companies and the United Nations, World Health Organization and World Bank. These criteria were not set by us; it is a criterion of common agreement.
The second thing I can tell you is that the price of efavirenz in Brazil, since it was launched in 1999, had a reduction of 78%. So, I think that when you ask me this question, we are looking at a certain time, isolating it from the historical fact. Efavirenz price is today the lowest among the other anti-retrovirals bought by the National STD/AIDS Program, 34% of the patients use Stocrin {brand name for efavirenz}, but it represents only 17% of the total cost of the Program.
Agência Aids: In an interview to the Agência, an activist said that pharmaceutical industry should be more transparent, should show their real costs for medicines. He said that if companies spent less money with marketing and publicity, it would be possible to reduce the medicines prices and make it affordable for those who need. Why the industry does do that?
João Sanches: I dont have any comment to make about this declaration because the figures of pharmaceutical companies, such as Merck, are published and are public. And the balance follows the parameters of sound accountancy. What I think people usually forget, for example, is the commitment that we have had for 21 years to research innovative medicines and that the first anti-retroviral comes from Merck Sharp & Dohme researches. Research is in the long term, and we keeping researching vaccines until now. We have two candidates in trials for a vaccine against HIV/AIDS. Our commitment is to undoubtedly find a solution for this disease. But to keep doing this research it is important that we have a safety environment for investment and have a return for shareholders and for people that, in any way, are investing for that.
Agência Aids: Considering what AIDS represents today in the world, don't you think that it is the moment for pharmaceutical companies have a different policy for AIDS medicines?
João Sanches: Do you know our global access policy? It already does that. I will summarize it for you. The global access policy set together with World Bank, United Nations Organization, UNAIDS, WHO and some pharmaceutical companies, established two criteria: HDI and prevalence of adult population. Among that, there are three categories of countries. The first one, which usually are developed countries, have high HDI and prevalence lower than 1%. There is a second group, where Brazil is included, which are countries with medium HDI and prevalence lower than 1% for adult population. In this price range, Brazil has the lowest price. And the third range, which include all Sub-Saharan African countries, which have the low HDI and prevalence more than 1%. Why the prevalence? Because it means the cost for society and for health systems of these countries to treat HIV/AIDS. In the case of Botswana, 40% of the adult population are infected by HIV/AIDS. It is impossible to compare Botswana and Brazil, where the prevalence of the latest is of 0,85%. And the HDI are totally different. So, according to these categories, we have a global price policy. For example, in countries with medium HDI and prevalence below 1%, such as Brazil, efavirenz price is US$1,80. In Brazil, the price is US$ 1,57.
Agência Aids: Up to where does Merck intend to go in the negotiation with the Government so that it doesnt bear the burden of the responsibility for the issuance of a compulsory license?
João Sanches: Usually we understand that we are committed and will keep negotiating with the Brazilian government. We believe that the compulsory license is not the best solution. Now, what I would like to contribute is that all this discussion is always looking from one side, which is from the pharmaceutical industry. It is not only pharmaceutical industry or Merck those who lose. I think everybody loses. Patients lose, and the country also lose, because coming back to what I have said in the beginning efavirenz is today the most economical solution among other medicines for the cocktail government has.
Maurício Barreira
Free translation: Gabriela Chaves
[plus some corrections by the E-drug moderator]