News and Analysis • Volume 12 • Number 4 • August 2008

Regional News - Colombia: Calls for Compulsory Licence

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Local civil society organisations, backed by a coalition of international health advocacy groups, have requested the Colombian government to issue a compulsory licence for AIDS drug Kaletra.

Kaletra is a best-selling HIV/AIDS cocktail manufactured by Chicago-based Abbot Laboratories. According to health activists, the treatment currently costs the Colombian public sector approximately US$1683 per patient annually, while prices for private health organisations reach US$4449. In contrast, Peru and Bolivia pay less than US$800 for a year’s worth of the drug’s generic version lopinavir/ritonavir, and the price could decline further.

Colombia Pays Too High a Price, Activist Say
On 16 July, 2008, an alliance of Colombian civil society groups called for their government to issue a compulsory license for lopinavir/ritonavir following months of Abbott’s inaction on their request that the company voluntarily licence its Kaletra patent. The proponents argued that access to a generic version of Kaletra would save taxpayers more than US$1million a year, a considerable sum that could be invested in scaling up HIV/AIDS treatment and strengthening Colombia’s health system.

On 6 August, more than three dozen international public health and patients’ rights advocacy organisations – including Nobel laureate Médecins sans Frontières and Health Action International – endorsed the local groups’ request in a letter to the Colombian government. “Issuing a compulsory license in this case will help promote access to medicines for all,” they said, adding that the high price charged by Abbott for Kaletra “constituted a barrier to access and hindered efforts to make antiretroviral treatment available in Colombia to all who need it.”

All proponents of the compulsory licence stressed that it was in the government’s power “to utilise the TRIPS flexibilities available to it.” In 2001, the Doha Declaration on TRIPS and Public Health confirmed that flexibilities under the internationally binding intellectual property agreement gave every WTO Member government “the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted.”

Nevertheless, Colombian authorities are likely to find it difficult to move on the activists’ demand at a time when the country’s free trade agreement with the United States remains in a limbo. US Congress has suspended consideration of the pact’s ratification until the Bush administration addresses globalisation-related concerns of American workers, as well as Colombian violence towards trade unionists (Bridges Year 12 No.3 page 16). The issuance of a compulsory licence for Kaletra could stiffen US opposition through turning the pharmaceutical lobby from supporter to opponent of the treaty. According to a source contacted by Bridges, the Colombian government is more likely to try and negotiate a price reduction with Abbott, although the source noted that chances of success were slim due to the huge price difference between generic lopinavir/ritonavir and brandname Kaletra (less than US$0.5 per tablet for the former and at least US$3.1 for the latter).

Controversies Galore for Kaletra
Abbot is no stranger to criticism regarding affordable access to Kaletra. Thailand, for instance, issued a compulsory licence for the drug last year (see opposite and Bridges Year 11 No.1 page 17). Time after time, Brazil has used a threat to do likewise, and eventually obtained significant price reductions after tough negotiations (Bridges Year 9 No.8 page 20).

The company also faces a slew of antitrust law suits filed in California by competitors, wholesalers and pharmacies. The complainants allege that in 2003 Abbott drastically raised the cost of Norvil – a key ingredient of most AIDS cocktails, including Kaletra – solely to squeeze out the competition. Abbott holds the patent for Norvil, which enhances the effectiveness of many multi-drug AIDS treatments. The price hike – from US$1.71 to US$8.57 for a daily dose – puts competing products at a disadvantage compared to Kaletra, which Abbott still sells at the same cost it did before the price of Norvil quintupled for other AIDS cocktail manufacturers.