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Brazil\'s corruption scandal may deal a blow to intellectual-property rights
IFPMA Press Review 7/22/2005 Brazil's corruption scandal may deal a blow to intellectual-property rights The Economist   Drugs and IP, 7/22/2005 - WHEN both parties to a negotiation declare victory, it often seems too good to be true—and in the case of a recent deal on AIDS drug prices ...
IFPMA Press Review 7/22/2005

Brazil's corruption scandal may deal a blow to intellectual-property rights
 
The Economist
 
Drugs and IP, 7/22/2005 - WHEN both parties to a negotiation declare victory, it often seems too good to be true—and in the case of a recent deal on AIDS drug prices between the Brazilian government and Abbott Laboratories, an American pharmaceutical firm, it was. On July 8th, the two sides announced an end to a stand-off over the cost of Kaletra, Abbott's anti-retroviral treatment. The drug accounts for nearly one-third of Brazil's budget for AIDS medications, which it provides free to HIV-positive citizens. The government had asked Abbott to cut Kaletra's price by 42% or grant a licence for the state to produce it. If not, Brazil threatened, it would disregard Abbott's patent and use a compulsory licensing procedure sanctioned by the World Trade Organisation (WTO) to manufacture the pills without the firm's permission.

Under the July 8th deal, Brazil would maintain its current annual spending level of $109m on Kaletra until 2010. As in the next six years the number of patients receiving the drug is expected to rise from 23,400 to 60,000, Brazil would pay a much lower average price per pill. Abbott's revenues would not change. Both sides hailed the deal which would let Brazil greatly expand its AIDS treatment scheme for nothing without hurting the firm's bottom line.

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