Brazil threatens to break patent on AIDS drugs

July 6, 2005

Brazil is threatening to break the patent of US-based Abbott Laboratories as it pushes ahead with its programme to supply its people with free AIDS drugs.

Brazil has given Abbott a deadline of July 7 to cut the prices of its drug Kaletra or a Brazilian company will begin cloning it. This move would test recent World Trade Organization concessions allowing poor countries to produce generic drugs for local health emergencies.

Abbott has said that Brazil's demand goes "against the spirit" of the WTO agreement, since it has the ninth largest economy in the world, and that this could damage future research for improved treatments.

Previous programmes have been negotiated between companies and governments to produce generic versions of AIDS drugs, but this is the first time a country has threatened to use powers negotiated at the WTO by producing the drug without the cooperation of the patent holder.

Several campaign groups are supporting the move, hoping that other developing countries will be able to take the lead of Brazil and produce generic drugs for their own populations. Michael Bailey, a senior policy adviser for Oxfam International, said: "The impact of breaking the patent would be enormous. If a major country such as Brazil goes through with this, not only will it help ensure sustainability of their excellent treatment programme, it will set a hugely important precedent for other countries."

The US Chamber of Commerce has issued a statement urging Brazil to reconsider and suggesting that the move could create a rift between the countries. Thomas Donohue, Chamber President and CEO said: "Brazil’s threat to strip patent rights from a U.S. company should concern all investors and every business around the world because of the precedent it sets for the treatment of intellectual property."