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Thailand issues license to manufacture generic version of Efavirenz; snubs Merck AIDS drug monopoly

Monday, December 04, 2006 by: Jessica Fraser
Tags: AIDS, intellectual property, drug patents

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(NewsTarget) Thailand announced last week that because of rising prices of foreign-made HIV/AIDS drugs, it would issue a five-year license to manufacture an inexpensive generic version of Merck & Co.'s Efavirenz drug.

Though Merck -- which holds the patent on Efavirenz -- criticized the military Thai government's decision to make its own cheaper version of the anti-retroviral drug, health advocates and AIDS activists commended the Health Ministry.

"This is both a brave and a progressive step by the Royal Thai Government to place the interests of people living with HIV in Thailand front and center," said UNAIDS country coordinator Patrick Brenny.

The Thai government -- headed by the military after a September coup to oust former prime minister Thaksin Shinawatra -- declared a "national emergency" under World Trade Organization rules that allow governments to issue compulsory licenses to manufacture patented drugs without consent from the patent holder. Merck will receive a royalty of 0.5 percent on sales of its generic version of the drug, which will cost half what Merck charged for Efavirenz.

Thailand's national drug program, which treats 82,000 of the 580,000 HIV/AIDS patients in the country, has gained international recognition for its efficacy. However, as AIDS patients live longer and foreign drug companies boost prices, the government has struggled with costs.

Thawat Suntrajarn, head of the Health Ministry's Department of Disease Control, said foreign companies' prices are "very high, making it a big hurdle for patients to access [HIV/AIDS drugs] and the government cannot afford them. In the long run [patients] need this anti-retroviral drug to live a normal life like others."

Consumer health advocate Mike Adams, a vocal critic of intellectual property rights for pharmaceuticals, said more and more countries are beginning to question the patent protection pharmaceutical companies are granted for chemical compounds.

"When it comes to AIDS and public health, most people in the world believe that drugs should be open source and available to the public at non-monopolistic prices," Adams said. "But drug companies want to soak the population for as much money as they can, without consideration for whether people have AIDS, cancer or other diseases.

"They want to enforce profiteering prices on everyone, and they use the protection of intellectual property patents to get away with it," he said.

Merck claims it makes no profits off Efavirenz in Thailand, and that the Thai government did not contact the company to attempt to resolve the cost problems before issuing the generic production license.

According to a World Bank study of the Thai drug program, the government took a risk in overriding Merck's patent, as the decision could result in trade repercussions. However, supporters of the generic manufacturing license say the move could bolster Thailand's ability to negotiate lower prices with other drug firms.


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