News 24, Licence boost for cheap drugs, 29 July 2004

Munich, Germany - US pharmaceutical giant Merck said on Thursday it had granted a licence to a South African company to produce a cheaper generic version of its Aids medication Efavirenz.

The non-profit deal will allow Thembalami Pharmaceuticals to supply the South African market and other countries in the south of the continent that have been ravaged by the deadly virus HIV.

"To be successful in the fight against Aids, all the affected interest groups must work together," said Per Wold-Olsen, the president of Merck's German unit, Merck, Sharp and Dohme (MSD), for the division Human Health in Europe, the Middle East and Africa.

"By granting the licence for Efavirenz, MSD wants to continue to support the efforts of the South African government in expanding its Aids program," he said in a statement.

MSD said it had begun offering Aids drugs in developing countries at wholesale prices in 2001 in cooperation with the United Nations and has now expanded the program to 60 countries.

Global pharmaceutical groups have been on the defensive for years over developing countries' insistence on access to cheap Aids medications, trying to protect their intellectual property rights on drugs they developed.

But in April 2001, 39 of the sector's top firms bowed to heavy pressure and dropped a court bid to stop South Africa importing cheap versions of their Aids drugs.

And in August of last year, the World Trade Organisation reached an agreement in Geneva in which poor, vulnerable countries will be able to import cheap generic copies of patented medication under a "compulsory licensing system".




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