The Wall Street Journal - July 10, 2000
Michael Waldholz, Staff Reporter

In an unusual collaboration, drug-maker Merck & Co. and the Gates Foundation said they will provide Botswana, a country especially hard-hit by AIDS, $100 million in money and medicines over five years. Abbott Laboratories, another big drug maker, confirmed that in recent weeks it has initiated a large charitable program that will provide a significant but as-yet undetermined amount of financial support to two African nations, Tanzania and Burkina Faso, as well as to Romania and India.

In addition, the German drug company Boehringer Ingelheim GmbH surprised the thousands of researchers, public-health officials and activists gathering at this seaside resort city this past weekend for the 13th International AIDS Conference by announcing that it will give away its anti-AIDS drug Viramune for use in blocking the transmission of HIV, the virus that causes AIDS, from infected pregnant women to their unborn children. And World Bank officials said they were planning to make available $500 million in the form of 40-year loans to any African country that sets up a national AIDS program.

Growing Awareness

The offers reflect the growing international awareness of the depth of the AIDS crisis. Many at the meeting here greeted the offers as long overdue support from the international community. But because the unrelenting spread of HIV is deeply embedded in problems related to poverty, weak public-health services and the pernicious nature of the virus itself, many here at the AIDS conference are taking a wait-and-see attitude about the charitable programs' potential benefits.

"This is the help we've been asking for for years," says Peter Piot, who runs the United Nations AIDS Program, called UN AIDS. "But if this support, some coming from corporations with little experience in providing public-health assistance in the developing world, is going to have an impact, it must be done very carefully. This is by no means a simple problem, and money and drugs alone are not going to solve it."

The new philanthropy follows several other recent high-profile charitable initiatives from the pharmaceuticals industry, which has been the target of intense criticism from governments and activists over the high prices of their AIDS drugs. In early May, a coalition of five drug companies, including Merck and Boehringer, offered to deeply discount drug prices in countries that can provide proof that they have the health services to handle the complicated medicines. Pfizer Inc. recently promised to give away doses of its antifungal drug Diflucan in South Africa for treating a deadly brain infection associated with AIDS.

Public-health officials attending the conference said the companies' generosity is the result of the recent recognition that AIDS is devastating communities, families and entire nations. Some noted, however, that the new offers are surely also aimed at softening the criticism being heaped on the companies. Company officials said privately that they expect public condemnations about their drug prices to reach a crescendo during the conference. And they acknowledged that they have been working intensely in recent months to get their programs in place in time for the AIDS meeting.

"We are responding to the calls for help and the public pressure too," said Rick Moser, a spokesman for Abbott. "Yes, we and others could have acted before, but clearly the time has come for us to act."

Abbott Initiative

Abbott has been quietly putting together its initiative since last summer, Mr. Moser said, but began to determine the scope of its offer and the countries that would receive it just in the past few months. The company only signed a formal agreement of help with Tanzania two weeks ago. Mr. Moser said Abbott hasn't made a formal announcement of the program because senior executives first wanted to have an identifiable impact in some communities.

Mr. Moser said the company began seriously thinking about a big initiative after Bristol-Myers Squibb Co. last year announced its own $100 million, five-year donation of money and medicines to five southern African nations. "You have to give the people at Bristol-Myers their due," Mr. Moser said. "They opened the door, and we and others are now walking through it."

Abbott's program is specifically designed to provide services to address problems among children, especially those orphaned by the disease. In cooperation with government officials in the countries targeted for help, the plan is to identify specific health and social needs, said Anne Reeler, a public-health planning specialist with Axios International, a Dublin-based consulting firm that Abbott hired to help design and implement its program. The company wants "to determine what we can do to have an immediate impact but also one that will be long-lasting after Abbott is gone," she said.

Abbott already is providing some initial grants in Mbeya, an especially poor region in southwest Tanzania where AIDS is rampant and there are thousands of children orphaned by the disease. In one village, Abbott money is being spent to repair large holes in the roof of a school where classes are often interrupted during lengthy periods of rain. The company also recently bought the region its first ambulance. "Fighting AIDS isn't just about giving away drugs, it also involves helping the people simply survive," says Joseph Saba, Axios's chief executive officer.

For its part, the new program funded by Merck and the Gates Foundation is aimed at bolstering Botswana's health services. Merck, too, said it has been trying for about a year to develop a program in Africa that could produce a meaningful benefit. It approached the Gates Foundation last winter seeking a matching fund of $50 million and then identified Botswana as a country where a concerted and focused effort might produce a significant impact.

"Merck and Gates picked Botswana because it's the top, the very top, of the AIDS catastrophe," said Richard Marlink, executive director of the Harvard AIDS Institute in Cambridge, Mass., which has been providing health-care support in Botswana for several years. About 36% of adults in Botswana are infected with HIV, and new data suggest about two-thirds of Botswana's 15-year-old boys will eventually die of the disease.

Merck, which advised Botswana of its interest in working there only last Tuesday, hopes to begin funding projects later this year, a spokesman said. Merck also expects to provide funding for drugs, though exactly how sizable that donation will be hasn't yet been determined.

Meantime, officials in South Africa, which has yet to decide if it wants to provide drugs to block mother-to-child HIV transmission, had a cool reaction to Boehringer's offer of Viramune. The country's health officials said they are awaiting results of further studies on the safety and long-term effectiveness of Viramune that are expected to be presented here later this week.

-- Rachel Zimmerman contributed to this article. Write to Michael Waldholz at mike.waldholz@wsj.com
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