Jon Liden, spokesman for the Geneva-based World Health Organization, said Merck's move was in part a response to increasing competitive pressure from Indian generic manufacturers. Merck CEO Raymond Gilmartin said he hoped his company's action would spur governments and other purchasers, including employers, to invest in the infrastructure which is needed to ensure powerful antiretroviral drugs are dispensed properly. Oxfam said the action by companies was undermined by their tough stance in defense of patents, which was preventing developing countries from securing the lowest-cost supply of medicines. As long as these kind of price cuts are not seen as a solution to this problem, then they are welcome. That rational was echoed by Bristol-Myers' Laverty.
Price is but one component to the solution.
The issue came to a head this week when a case brought by 39 of the world's biggest pharmaceutical companies to stop South Africa importing cheaper AIDS drugs came to trial in Pretoria. The companies contend South African legislation allowing such cheap imports infringes their intellectual property rights. The South African government and the industry's critics argue that drug companies abuse their patents in the way they price medicines in different markets. The trial was adjourned Tuesday until April 18. Industry analysts said the industry appeared to be taking pre-emptive action by pushing through price cuts.