Important note: Information in this article was accurate in 2005. The state of the art may have changed since the publication date.
The New York Times - August 19, 2005
Paulo Prada
A ministry spokesman, Estenio Brasileino, said Thursday that the government sent a letter to Abbott last week after several Brazilian laboratories notified the ministry that they could manufacture and sell a generic version of the drug, now purchased from Abbott at $1.17 a pill, for 41 cents a pill.
After negotiations with Abbott in July, Brazil's departing health minister, Humberto Costa, said the government had reached an agreement with Abbott under which the drug maker would lower the price of Kaletra by an undisclosed amount. Without discussing terms, the government said the lower price would save it $259 million over six years.
Kaletra, a widely used antiretroviral, is one of several medicines that make up the so-called cocktail used to treat patients with H.I.V.
Less than a week later, however, Jose Saraiva Felipe, Mr. Costa's successor, dismissed the agreement and said Brazil would press for further reductions.
Abbott, which is based in Abbott Park, Ill., said it last met with the Brazilian government about a week ago and was continuing to negotiate a possible price change.
"We had what we thought was a very good agreement," said Brian Kyhos, a spokesman at Abbott headquarters. In light of the new demands, he added, "We will continue to seek a price level that Brazil can agree to and honor."
The Brazilian demands reflect efforts by the government to reduce the ballooning costs of the country's ambitious AIDS program, which provides free medicines and treatment to those infected. The cost of Kaletra makes up nearly a third of the more than $300 million the country spends a year on medicines for the program.
At present, some 170,000 people in Brazil, Latin America's most populous country, are believed to be infected with H.I.V., according to government figures.
The growing numbers, the government argues, would allow it to declare a national health emergency - a move that under World Trade Organization rules would allow Brazil to break the patents on medicines and pay a 3 percent royalty to manufacturers for the rights to produce copycat versions.
The standoff with Abbott is the latest of several battles waged by the Brazilian government to reduce the cost of medicines in developing countries.
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