The patent process is crucial to continued innovation,'' said Greg Reaves, a spokesman for Merck. Patents are the basis for high drug prices. The companies say the revenue allows them to recoup development costs and generate profits to fund new medicines. Pharmaceutical executives are quick to point out that this system created the AIDS drugs in the first place. AIDS activists have been calling for drug companies to offer cheap drug-licensing agreements to poor countries.
Drug companies have powerful allies in their effort to keep generics at bay.
Harvard economist Jeffrey Sachs, active in the African AIDS fight, agreed it was important to respect patent rights while solving the crisis. Analysts fear that, even with patent protection, the reduced drug prices will eventually be too costly. Pharmaceutical companies have always had significant charitable programs, but the demands in fighting AIDS could be too much. Negative responses from shareholders and others has been scant. Pharmaceutical executives are skittish about detailing the finances behind their deep discounts for fear of unnerving shareholders.