PRIVATE BRAZILIAN DRUG FIRMS PLEDGE CHEAP ARV CAPACITY

Brazilian media sources report that a group of unidentified local drug firms has promised health officials a cheap copy of US-based Abbott Laboratories' ARV Kaletra, in the event that the government decides to compulsorily license the drug. The suggested price of US$0.41 is even cheaper than the US$0.68 unit cost pledged by state-owned drug producer Farmanguinhos.

Government contacts with the US firm are understood to be ongoing, although Abbott has announced that it is "extremely disappointed" that officials have begun the compulsory licensing process. Under TRIPS rules, the US firm will be entitled to 3% royalties on the copy, despite an abortive deal that envisaged lowering the price over a period of five to six years. Abbott's drug is estimated to cost Brazilian health agencies roughly BRL250mn (US$109.78mn) per year.