Brazil Requests Production Licences for US Firms' Antiretrovirals

The Brazilian health ministry has sent letters to three US drug firms, Merck & Co., Abbott Laboratories and Gilead Sciences, requesting licences to produce antiretroviral (ARV) drugs for the country's HIV/AIDS treatment programme. The request for voluntary licensing of Tenofovir, Efavirenz and the Lopinavir/Ritonavir combination therapy follows a series of official threats to break patents on ARVs in recent months. Although the government has offered to pay royalties on the drugs, authorities have indicated that they will proceed with producing the drugs even in case of a refusal by the US drug firms, expected to reach a decision in May.

According to Brazilian officials, the four drugs currently account for more than half of the costs of the country's BRL900mn (US$327.01mn) ARV treatment programme, which the government hopes to expand to 180,000 sufferers by the end of 2005. Brazil already produces eight of the 16 ARVs used in the free-of-charge programme, and has pledged to import the remaining four drugs once production of the US firms' patented products begins.

The request is likely to be watched closely by drug multinationals, which are likely to take issue with the government's use of the provisions in TRIPS for "national emergencies" as its justification. Notably, the country already produces 90% of its ARV requirements, and state-owned drug firms have manufactured ARVs since 1994, prior to the introduction of specific patent legislation in 1997. Although authorities have pledged not to export any surplus ARV production, there will remain suspicions that the government is seeking to favour its manufacturing sector, in which authorised and unauthorised generics play an increasingly important role.