In a study from the Harvard School of Public Health, Amy Nunn and colleagues analyzed the costs of individual AIDS drugs in Brazil. They found that even though the generic drugs produced in Brazil were generally more expensive than similar drugs made elsewhere, by negotiating patented drug prices, Brazil has enjoyed lower prices for patented AIDS drugs than many other developing countries.
The researchers also analyzed aggregate costs of Brazil’s AIDS drugs and found that Brazil’s total AIDS drug costs have more than doubled in recent years and that the costs of producing generic drugs in Brazil has risen steadily over time. The study concludes that although the Brazilian model of producing drugs locally and negotiating prices initially saved Brazil $1 billion, drug costs rose rapidly as Brazil provided treatment to increasing numbers of people and the lives of people with HIV/AIDS became longer.
Although world leaders have set a target of universal access to AIDS treatment by 2010, little is known about the long-term costs of AIDS treatment in developing countries. Brazil’s experience provides important information about how AIDS treatment costs are likely to evolve in other developing countries as efforts are made to provide universal access to life-saving drugs and as life expectancy for people living with HIV increases.
In 1996, Brazil became the first developing country to commit to providing free and universal access to AIDS drugs. Since then, Brazil’s successful AIDS treatment program has become a model for the developing world, with 180,000 Brazilians receiving treatment at the end of 2006.
The study highlights economic consequences of Brazil’s sometimes controversial policies. As a member country of the World Trade Organization that signed on to the Trade-Related Aspects of Intellectual Property (TRIPS) agreement, Brazil was required to recognize the intellectual property rights of pharmaceutical companies’ patented AIDS drugs. As Brazil scaled up treatment in the late 1990s, the cost of treating AIDS patients rose quickly and the country took controversial public policy steps to reduce the cost of providing treatment to people living with HIV/AIDS. Brazil produces eight non-patented AIDS drugs locally, and since 2001 has challenged five multinational pharmaceutical companies about the prices of several patented AIDS drugs. To induce price reductions for patented drugs, Brazil has threatened to issue compulsory licenses (which under WTO terms allow countries facing a health emergency to produce patented drugs without consent of the company holding the patent) and in May 2007 issued a compulsory license for efavirenz, an AIDS drug for which Merck holds patent rights.-Public Library of Science
