SOUTH AFRICAN CO-OPERATION WITH MULTINATIONALS GROWS

In the wake of South Africa's recent US$500mn ARVs tender, set to expire in 2007, the level of co-operation with major multinational manufacturers of HIV/AIDS drugs has continued to increase. According to local reports, US major Merck & Co has now agreed to voluntarily license its Stocrin (efavirenz) product to Africa's largest drugmaker, Aspen Pharmacare.

Merck recently boosted its South African production in Midrand, investing some US$3mn on the latest phase of its expansion to its local facility, which had included an upgrade to packaging operations in 2003.

However, the deal with Aspen will mean that the South African firm will now produce all four of the government's first-line therapies, stavudine, lamivudine, and either nevirapine or efavirenz. About 80,000 South Africans are known to be taking Stocrin, but Merck expects a substantial expansion in consumption levels, with fresh demand also coming from other regional markets.

Merck's deal replaces a previous arrangement with local player Thembalami, which was allegedly terminated after the company failed to obtain the necessary generic supplies from India's Ranbaxy. Meanwhile, Aspen claims that the locally-made generic will be priced "competitively," and that Merck will not receive royalties under the deal. Further, Aspen is hoping to get the US FDA's blessing for the drug, potentially enabling the generic to be distributed under the US government's US$15bn PEPFAR HIV/AIDS pandemic relief programme.