The Washington Blade - August 13, 1999
Kai Wright

The issue of drug pricing has become particularly important for many people with HIV because the "triple drug therapy" recommended by the U.S. Department of Health and Human Services for treating HIV costs the average patient between $10,000 and $15,000 per year. AIDS Action's study highlights that increased demand for this therapy has driven up national spending on HIV drugs by 1,047 percent in the last five years -- from $129 million in 1993 to $1.48 billion in 1998. Drug industry associations insist that the drugs are priced to match the resources expended on cutting edge research to develop new treatments, such as protease inhibitors, that can save lives.

AIDS Action argues that this assertion is false. Citing the annual reports of the 15 largest pharmaceutical companies, AIDS Action said the companies spent a collective $68.4 billion on marketing and administration in 1998 and while they spent only $24.4 billion on research and development. They reaped a collective $224.2 billion in gross sales. The report also stresses that many AIDS drugs are developed in part with federal funding.

Congress is currently considering a handful of bills relevant to prescription drug pricing. Rep. Bernie Sanders (D-Vt.) has introduced a bill that would restore the "reasonable pricing" requirements once attached to research funding from the National Institutes of Health. The bill would prohibit any private firm from patenting health care technology developed in part with federal funds until it enters into a "reasonable pricing agreement" for the product with HHS.

Rep. Marion Berry (D-Ark.) has introduced a bill that would allow U.S. wholesalers and distributors to re-import drugs exported by U.S. pharmaceutical companies. Often, drug companies sell their products at much lower prices in Europe and other developed countries than in the United States and in the developing world. Under Berry's bill, U.S. pharmacies and drug wholesalers could purchase drugs from foreign wholesalers at those lower prices. The House has not acted on either Sanders's or Berry's bill.

Last week, the House rejected a Sanders amendment to the fiscal year 2000 State Department authorization bill that would have barred the department from "imposing restrictions" on developing world countries' efforts to craft intellectual property laws that help make pharmaceuticals produced in the United States more affordable in their countries. Sanders and Rep. Jesse Jackson Jr. (D-Ill.) are expected to introduce the amendment as a freestanding bill later this session. The bill is a response to an ongoing flap between AIDS activists and the Clinton administration. The administration has lobbied South Africa to alter a 1997 law easing patent restrictions on AIDS drugs currently exclusively marketed by U.S. drug companies, expressing concern that the law is written too vaguely and could be used to violate international trade agreements.

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