ACT UP PHILADELPHIA Press Release

FOR IMMEDIATE RELEASE: May 11, 2000

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Kate Krauss, (215) 731-1844

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May 11, 2000: AIDS activists campaigning for affordable access to life extending AIDS treatments met today's announcement of a "joint agreement" between UNAIDS and major AIDS drug manufactures with deep skepticism. In exchange for a moderate price reduction, pharmaceutical interests have attached a conditionality that prevents poor nations from exercising WTO-legal means to manufacture generic versions of expensive patented medicines. Activists charge that the prohibition against compulsory licensing ties the hands of poor nations seeking self sufficiency, and imposes a remedy dependant on the generosity of multinational corporations. ACT UP also notes that the price reductions offered by industry will not be sufficient to ensure widespread access in poor countries.

"The Pharmaceutical kingpins are attempting to prohibit African nations from creating self-sufficient solutions to the AIDS crisis," said SharonAnn Lynch of ACT UP Philadelphia. "The strings attached to this price reduction amount to a noose."

"The price cuts are not deep enough. All but the wealthiest will continue to have no access to life-saving medicine. The only acceptable plan from industry will guarantee affordability through cuts of 95% or more of the prices we pay in the West," said John Bell of ACT UP Philadelphia. "Additionally, drug makers cannot not be allowed to restrict additional means for access, including procurement from generic suppliers who already sell the same life-saving pills for pennies."

The five drug companies involved in the agreement are not revealing the extent of their price reductions, but activists contend these cuts will not match the scale of affordability that could result from procure-ment of drug through cheaper, generic suppliers. Generic producers have indicated that, with large-scale production, AIDS drug costs would fall far below any decrease in price currently discussed by industry.

"Based upon discussions with generic producers, we believe it may be possible to manufacturer a three drug anti-HIV combination for less than $250 per year," said James Love, director of the Consumer Project on Technology. "To get the costs down this low, it would be necessary to have large scale production, and to address issues such as intellectual property rights and drug registrations in several countries, and to have efficient procurement systems. So far, there is no effort by the US or by international organizations to get prices anywhere near this low, but if there is a true commitment to providing treatment for millions of infected people, this is what must be done."

As reported today in the Wall Street Journal, the price reductions suggested by the companies currently involved in the initiative would still amount to a price tag of about US$2550 per year-- 90% higher than price cuts possible through strategies such as compulsory licensing and parallel importing. "We have serious doubt that industry will cut their exorbitant prices deep enough to result in true access--not access only for the relatively well-off of the developing world," said Joe West of ACT UP. "History recalls many 'price reduction' schemes that only translated into good PR for industry." Activists are also wary of onerous contingencies on poor countries seeking affordable drugs. "Poor countries must not be forced to relinquish their right to a range of potential strategies for increased affordable drug access," said Joyce Hamilton of ACT UP.

This announcement comes in the midst of an intensive, international activist campaign to increase affordable AIDS drug access in poor countries, where medications that treat HIV are out of the reach of virtually all AIDS patients. For over a year, AIDS activists from the US, Thailand, South Africa, and Central America have been pressuring US-based drug firms and the US government to increase AIDS drug availability worldwide.

The drug companies' announcement follows yesterday's executive order by President Clinton easing US pressure campaigns against African nations using WTO-legal means to provide generic versions of life saving patented medications. The executive order was requested by ACT UP Philadelphia at a meeting with US Trade Representative, National Security Council, and Health and Human Services officials on April 12.

ACT UP demands:

1. Deep price reductions guaranteed to increase access for people with HIV in the developing world.

2. Agreement from patent holders to grant voluntary licenses for alternative production and importation of drug by poor countries.

3. Access to drugs at reduced cost must not be contingent on agreement by a country to abandon strategies such as compulsory licensing and parallel importing.

4. Significant price reduction must be extended to all medications used in the treatment of HIV, not only anti-viral drugs.

5. Transparency in the development of this initiative, with the involvement of community representatives and consumers at all levels.

6. Suspension of legal action against countries currently attempting to increase medication access through use of strategies such as compulsory licensing and parallel importing.

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