Case Study on: GlaxoSmithKline
Case OBJECTIVE: “GSK” TO SUPPLY ANTIRETROVIRALS AND ANTI-MALARIALS AT SUSTAINABLE PREFERENTIAL PRICES FOR ELIGIBLE CUSTOMERS IN THE LEAST DEVELOPED COUNTRIES AND ALL SUB-SAHARAN AFRICAN COUNTRIES.
Eligible customers include the public sector, not-for-profit NGOs, aid agencies, UN agencies and international purchase funds such as the Global
Fund to fight AIDS, TB and Malaria. Additionally, because of the gravity of the situation in sub-Saharan Africa, employers there who offer HIV/AIDS
care and treatment directly to their staff through workplace clinics are also eligible.
MADE BY: JIGAR.R.RAJPURA
X-01824544
Sustainable Preferential Pricing Arrangements
GlaxoSmithKline has offered preferential pricing for our HIV/AIDS medicines since 1997. They placed a high priority on their prices being sustainable. This means setting prices at levels that meet their costs, thereby ensuring they can sustain supply of these high-quality products for as long as they are needed.
The Promise
In ‘Facing the Challenge’ it is promised to:
- extend preferential pricing to more products, countries and customers;
- supply antiretrovirals and anti-malarials at preferential prices to public sector customers and not-for-profit organisations in 63 countries – all the Least Developed Countries of the world and all of sub-Saharan Africa;
- supply ARV therapy at preferential prices to employers in sub-Saharan Africa who provide HIV/AIDS care and treatment directly to their staff through their own workplace clinics;
- make thier ARVs and anti-malarials available at preferential prices to international purchase funds;
- set up pilot projects with non-governmental organisations (NGOs) in five African countries to evaluate the impact ofoffering a more extensive range of medicines at preferential prices;
- work on a case-by-case basis with middle income developing countries through the AAI and unilaterally to make treatment more affordable;
- continue established discounting arrangements for vaccine supply
- work with genuine partners on other ways of making medicine more affordable for developing countries.
Progress
They have concluded some 95 arrangements covering 31 countries for the supply of preferentially priced ARVs. Chart A outlines these partners by type and progress since the start of 2001. Nineteen of the supply agreements have been through the Accelerating Access Initiative (AAI). AAI is the partnership, established in 2000, between UN agencies and six pharmaceutical companies. Among the AAI partner countries are middle income developing countries that have shown strong political will to tackle HIV/AIDS. These include Honduras, Trinidad and Tobago, Romania, and Chile. The AAI has had an important catalytic effect. A further 59 countries have expressed interest in joining. As a result of these initiatives, a tenfold increase in shipments of preferentially priced Combivir to the developing world in the first half of 2002 compared to the first half of 2001 occured. In the first six months of 2002 were shipped nearly five million tablets of Combivir compared to just under half a million tablets in the same period in 2001. (see Chart B). Shipments of Retrovir and Epivir have also increased significantly; shipments of the newer ARVs Ziagen and Agenerase have been slower, but are starting to increase. It is difficult to estimate how many patients are being treated. This depends greatly on the capacity of the local infrastructure and programme implementation, which is the responsibility of each national government. Together with UN agencies, national governments and GSK industry partners, are continuing to explore how to measure actual patient numbers. Results from a study completed in May 2002 for the six companies involved in the AAI indicate a fourfold increase in the number of patients in treatment in Africa from Quarter 3 2000 to Quarter 1 2002, estimating a total of over 35,500 patients. The absolute number remains very low relative to the need, but the progress is encouraging. In addition, the data show that there has been an increase in the quality of treatment over that period, with a larger proportion of patients receiving triple combination therapy. There has been little interest in GSK’s preferentially priced anti-malarials. Lessons from Malarone Donation Programme suggested that this may be because there is a greater clinical need for first line therapies than for more advanced second and third line therapies such as Halfan and Malarone. GSK has offered substantial discounts on our vaccines for public health programmes for over 20 years. In 2001 GSK supplied over 540 million vaccine doses at significant discounts to UNICEF, the World Health Organization (WHO), the Pan-American Health Organization (PAHO) and the Global Alliance for Vaccines and Immunisation (GAVI). It has reached agreement with five NGO partners, in Zambia, Malawi, Uganda, Tanzania and Nigeria for other pilot programmes, which cover a wider range of therapeutic products including anti- infectives, respiratory and gastrointestinal products. The purpose of the pilots is to assess the success of discounting arrangements in expanding access to treatment and their impact on existing treatment programmes. which cover a wider range of therapeutic products including anti- infectives, respiratory and gastrointestinal products. The purpose of the pilots is to assess the success of discounting arrangements in expanding access to treatment and their impact on existing treatment programmes. Experience gained in setting up the pilots has confirmed that local ownership is essential, and that where health infrastructure does exist, the key barrier to access is lack of funding to purchase already available low cost medicines, rather than non-availability of those medicines. And healthcare professionals on the ground want access to basic healthcare to be available before provision of advanced complex therapies. We have adapted our proposals in response to these learnings. In October 2001, GSK granted a voluntary licence to Aspen Pharmacare, for it’s patents in South Africa for the ARVs Retrovir, Epivir and Combivir. This licence enables Aspen to manufacture the products and sell them to the South African government and others in the ‘not for profit’ sector. GSK has waived our right to a royalty fee and
