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Brazil Voids Merck Patent On AIDS Drug 765

JoeBackward writes "Merck has this useful anti-AIDS drug Elfavirenz, and Brazil has lots of poor people with AIDS. So, after trying really hard to get Merck to cooperate on pricing, the Brazilian government has decided to take a 'compulsory license' to the patent, and get the drug from a factory in India. This compulsory license is basically a way to take the patent by eminent domain." This move gives Brazil one more thing in common with Thailand, both of which have blocked YouTube. Thailand's compulsory licensing of Elfavirenz and Plavix has landed the country on the US's watch list for piracy.
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Brazil Voids Merck Patent On AIDS Drug

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  • by drfrog ( 145882 ) on Saturday May 05, 2007 @01:23PM (#19002569) Homepage
    it s nice to see humanity win one for a change

    who can really put a price on that?
    • Re: (Score:3, Informative)

      by TrnsltLife ( 779961 )
      Agreed. Good for them, it's good to see a country looking out for the welfare of its own citizens ahead of the profits of some multinational corporation.
    • by Jarjarthejedi ( 996957 ) <> on Saturday May 05, 2007 @01:29PM (#19002625) Journal
      I have to agree on this one. Normally I'm against things like this because I personally feel that the more this stuff happens the less likely people are to work towards something, the whole private property issue. In this case, however, the pricing was just absurd, the company was not trying to make a slight profit by helping people (which I'm fine with) but way overcharging them. Good for Brazil.

      Sure, it cost them a lot to make it. But this isn't a drug whose need is going to go away any time soon and trying to remake your investment quickly means that poor people can't buy something that can save their life. Crix whatever should've been priced in such a way so that 10-12 years down the road they began making a profit, not so that they start making profit almost immediately. I mean, what investor wouldn't invest in an AIDS drug just because they're not likely to recoup their losses within a year? We all know AIDS is going to be around for a while, cut your prices so that more people can get it.

      But hey, just my opinion. Hopefully Brazil can start getting cheap crix out in their country and save some lives.
      • by hxnwix ( 652290 ) on Saturday May 05, 2007 @02:22PM (#19003173) Journal
        They do need to recoup the cost of the development of failed drugs and dead-end research.

        That being said, we might also want to remember that RIAA members need copyright durations of artist's death + 1000000 years in order to compensate for all those failed artists.

        And let us not forget that not every hole exxon drills yields oil, which makes $3.50/gallon a reasonable price for 85 octane gas.

        Furthermore, we should bear in mind that baby seals are vastly overpopulated ...
    • by JeanBaptiste ( 537955 ) on Saturday May 05, 2007 @01:29PM (#19002629)
      ... but it took capitalism to create the formula for the drug in the first place ... without capitalism _nobody_ would get this drug. so i'd say its not humanity vs capitalism, rather humanity benefiting from capitalism, and brazil and thailand aren't helping any.
    • Re: (Score:3, Insightful)

      by slughead ( 592713 )
      it s nice to see humanity win one for a change

      who can really put a price on that?

      *Raises hand* OOh! I can!

      The number of years added to the lives of the Brazilians who get this drug at a reduced cost will be subtracted several times over from future AIDS victims who would have otherwise have had better drugs available due to the added research dollars.

      In short, adding 10 days more life now = subtracting 20 days more life in the future (arbitrary but realistic figure). People who want to ban patents on drugs
      • by Rix ( 54095 )
        If drug companies invested a significant percentage of their revenue on research. They don't (about 5%). It's *far* more efficient to give the money that would be spend on non-generic drugs to university research programs.
      • Absolutely silly. But it's a good measure here. Looks like Big Pharma's line of shit is considerably more effective than the RIAA and MPAA. Here's hoping they don't catch on.

        Here's the reality of the situation. The biggest expense to Big Pharma is not research and development (which mainly takes place in universities, including a lot of public ones. Big Pharma does not fund those. You and I do.) It is not testing (and that could be handled entirely by the FDA, without their involvement at all. A lot of it already is. Big Pharma does not pay for the FDA. You and I do.) Their biggest expense is not manufacturing the pharmaceuticals, which, as should be obvious here, can be done pretty cheaply. Their biggest expense is wining, dining, and schmoozing doctors to use their medicines. To advertise on TV, to get patients to push doctors into getting them whatever medication that is. And to pay overpaid executives.

        Let's cut out the middleman, and one of the biggest expenses here-the millions-per-year CEOs. Fund the universities well to develop the drugs. They will develop drugs for Third-World maladies, once the impetus to "make something you can sell" is gone. Have the FDA entirely in charge of testing, and farming out production-just production-to corporate entities. There we go.

        Under the current system, there's far more incentive to look for treatments rather than cures. A treatment is a lifelong paycheck, a cure is a one-time payment. There's far too much impetus to develop Viagra rather than treatments for diseases that kill millions in poor countries. There's far too big a temptation to hold back a slightly-improved formulation until the patent on the current one is about to expire, and to use it to extend the patent far longer than it was intended to last. If that system collapses, I won't shed too many tears. Something better will replace it.

      • Re: (Score:3, Interesting)

        The number of years added to the lives of the Brazilians who get this drug at a reduced cost will be subtracted several times over from future AIDS victims who would have otherwise have had better drugs available due to the added research dollars.

        There are a few problems with this argument:

        1. If Brazil had gotten the drugs for the price they wanted, Merck would still have made a profit, whereas Brazil was not going/able to pay what Merck was asking, so the alternative is no profit, and fewer research dollar
    • Re: (Score:3, Insightful)

      by Frangible ( 881728 )
      Humanity didn't win one. To develop and screen drug candidates, and do human trails (of which a low percentage ever make it past the preliminary stage) is fantastically expensive. The patent protection for drugs is very short-term and among other things, is incentive for the very large costs of developing the drug. So... sure, in this case, poor people get AIDS drugs. But if the company knows that pouring millions into AIDS drugs is just going to get their work stolen, they're not going to research AIDS
    • Re: (Score:3, Informative)

      by wannasleep ( 668379 )
      I'd like to point out that what Brazil did is actually legal under TRIPS []. TRIPS is the treaty that regulates Intellectual Property world-wide. The same treaty under which so many other cases are prosecuted. One of the TRIPS provision states that a number of countries can exercise compulsory patenting on pharmaceuticals for a number of years (I believe 15, but I am not sure). It was done to lure many countries into the treaty.
  • youtube (Score:5, Insightful)

    by gargletheape ( 894880 ) on Saturday May 05, 2007 @01:27PM (#19002597)
    you know what else Brazil and Thailand have in common? A boisterous tourism industry and hot girls. Seriously, what does youtube have to do with this story?
    • Re:youtube (Score:5, Informative)

      by Anonymous Coward on Saturday May 05, 2007 @01:47PM (#19002843)
      as a matter of fact, brazil stopped blocking youtube three days after the ban was actually set. And not all ISPs complied with the ruling, only one, Brasil Telecom, which is responsible for broadbrand in all southern states.
  • bullshit (Score:3, Insightful)

    by teknopurge ( 199509 ) on Saturday May 05, 2007 @01:27PM (#19002599) Homepage
    this is not about humanity. the only reason this drug even exists is becuase money was able to be spent on R&D to create or discover the compound. Brazil has just put another nail in the coffin of innovation by this move: if a company cannot make money from a discovery or invention the amount of both will decline.
    • by TimTucker ( 982832 ) on Saturday May 05, 2007 @01:36PM (#19002713) Homepage
      As they say: necessity is the mother of innovation. As long as we have a need for medicine, someone's going to do the research to look for it. It may become less easy to justify spending millions in funding and make millions in profits off of discoveries, but that doesn't mean that innovation will stop.
    • the only reason this drug even exists is becuase money was able to be spent on R&D to create or discover the compound.

      True, and for the record, I think this situation sucks from any angle. But maybe if they just set their price a little lower, they would be making more money than they will be now, and they wouldn't make people hate them.

      Doing it over and over will kill innovation. Doing it a few times is tough love.

      In any case, I think Merck's $4 billion in annual profits will keep them from having to
    • Re:bullshit (Score:5, Insightful)

      by geekoid ( 135745 ) <<moc.oohay> <ta> <dnaltropnidad>> on Saturday May 05, 2007 @01:43PM (#19002791) Homepage Journal
      Brazil wanted to give them some money.
      Mereck said no so Brazil took it to save the lives of its people.
      Considering its a global company, They should have taken Brazils offer and looked to Europe and N.America to recover costs.
      OTOH, since Merick wouldn't sell to Brazil anyways, there not actually loosing money now, are they?
  • Patenting drugs that essentially exploit the poor and/or the third world is wrong. I appreciate that finding cures for diseases such as AIDS is incredibly hard work, time consuming and very expensive, but that doesn't give anyone the right to hold the world hostage.

    Hopefully we'll see this happening with software patents in the next few months.
  • "Black Box" Drugs? (Score:5, Interesting)

    by Kadin2048 ( 468275 ) * <slashdot.kadin@x[ ].net ['oxy' in gap]> on Saturday May 05, 2007 @01:28PM (#19002613) Homepage Journal
    I wonder what the endgame might be out of situations like this.

    Right now, my understanding is that to produce and get approval for a drug, you need to release its chemical formula and other information about it.

    But I wonder if at some point in the future, if the drug companies get too worried about their profits due to genericization in countries like Thailand and Brazil, that they might try to implement some sort of "drug DRM." Rather than making the composition of the drug open, don't release what's actually in it, and just test it as a 'black box,' show empirically through tests that it's effective and reasonably safe, but dope the actual pills with a lot of random substances that make it difficult to reverse-engineer (or have the actual drug only be something that's produced in the body through subtle combinations of various things in the pill, or keep the methods of producing the various chemicals in the pills a secret). I'm sure there are lots of bizarre ways that the drug companies could think up to protect the compositions.

    Now, I'm not saying that any of these schemes would be effective at protecting the composition -- if the market for a generic drug is big enough, the labs in Thailand can probably afford to spend a lot of time with a mass spectrometer/gas chromatograph and unravel it, but that doesn't mean the drug companies wouldn't try, and waste a lot of time and effort in the process.

    As we've seen in the battles over digital IP, there are a whole lot of things that can end up as collateral damage in the fights between rightsholders who see the gravy train slowing down, and people who want their products at a lower price than is being offered.
    • by haluness ( 219661 ) on Saturday May 05, 2007 @01:42PM (#19002773)
      > Rather than making the composition of the drug open, don't release what's actually in it,
      > and just test it as a 'black box,' show empirically through tests that it's effective and
      > reasonably safe, but dope the actual pills with a lot of random substances that make it
      > difficult to reverse-engineer

      I really can't forsee any form of DRM for chemical compounds. It's quite like DRM for music - at one point the music has to be played on a speaker. Similarly, if you're going to make a drug, you're going to have to give the pill out at which point you have the whole field of analytical chemistry (mass spec, HPLC etc) at your disposal!

      Furthermore, adding random substances to it, doesn't really hinder the identification process - they'd just show up as separate peaks on the spectrum. In addition randomly adding substances to a drug mixture would probably mess up pharmacokinetics which would have to be restudied all over again.

      Unfortunately the chemical world is a little bit messier than the digital world :)
      • Re: (Score:3, Informative)

        by Anonymous Coward
        In fact there are at least two such drugs. Premarin is actually made from Pregnant Mare Urine (get it) by a process that is a trade secret. No one is entirely sure which of the components of the final product are active and which aren't. As a result, last I checked (a couple of years ago), no one had successfully developed a generic. A similar situation exists for Thalidomide (which is now a very effective treatment for Multiple Myeloma and a somewhat less effective treatment for other cancers). The dr
  • Greed (Score:2, Interesting)

    by shuz ( 706678 )
    Ultimately drug companies do need to make a buck too. How are drug companies supposed to effectively control supply and demand to drive up prices if countries like Brazil just get drugs as they please. I suppose this is also a good argument against outsourcing the production of your drugs to countries that are not within your control or goverments that are not on your payroll. Sad...
  • Any drugs to these countries and they'll be forced to reverse engineer everything from AIDS drugs to chemotherapy to antibiotics. Viva La Revolucion!
  • nonsense (Score:4, Insightful)

    by wizardforce ( 1005805 ) on Saturday May 05, 2007 @01:32PM (#19002663) Journal
    what happened was this: merck had the AIDS drug and Brazil tried to negotiate it at what they could afford, merck declined, Brazil then told merck to screw themselves and got the drug anyway. it isn't so much an attack on merck's ability to make money off its own research as it is the idiot practice of denying DYING people medical treatment for the sake of said profit. moral of story: better to negotiate then to be bypassed.
  • by had3l ( 814482 ) on Saturday May 05, 2007 @01:33PM (#19002683)
    I remember seeing that "Brazil blocks Youtube" thing on slashdot, but seriously, I tested it back then, and there was no block, I talked to everyone I know, and they also noted no block. Not that one wasn't issued though, it probably was never enforced.

    It was a BS case anyway, it was a public beach, everyone was there to see them having sex. If anyone was breaking the law, they were. Of course, with the justice system here as corrupt and moronic as it is, those kinds of rulings aren't surprising. Believe me though, 100% of the Brazilian people would be against any sort of ban.

  • This just highlights in a new way, how far wrong we have gone with our patient system. Imagine if Salk had demanded a premium for his polio vaccine, the US government would have taken it under the same premises. The same if the patient holder for Biothrax had withheld rights from the US government for the anthrax vaccine in 2002. But wait those are brown people, foreigners dying from a disease with a social stigma, so let's call them thieves.
    • They are thieves, this part is simple. However it's probably justified thievery in this case. I don't hold it against them as long as they tried, in good faith, to negotiate a deal with Merck first.

      See, the problem with your analogies is that they're simply wrong. Let me give you a better analogy. Merck finds some basic research that looks promising that can provide a one-shot complete cure to HIV. However, it will cost $10 billion to develop. They think for a minute... "hmm.. if we do this, will we

  • Argh Matey - Brazil Be a-Savin' Yer Scalliwageous Lives! []

    (Seriously, why make them walk the plank just for being humanitarian?)

  • Again. Last time the use of generics derailed the debate. Who knows what will happen this time, but the issue dovetails nicely.

  • by Anonymous Coward
    This move gives Brazil one more thing in common with Thailand, both of which have blocked YouTube.

    This is a warped comparison... AIDS will hill hundreds of millions of people in our lifetime. YouTube is a floofy website. AIDS will still be a problem in 20 years. YouTube probably won't exist.

    How are these two situations related, exactly? Are you trying to make some comparison because both involve "Intellectual Property"? If so, you failed.
  • by Wdi ( 142463 ) on Saturday May 05, 2007 @01:56PM (#19002931)
    Year 2001: 5 (five) US citizens die in Anthrax scare. US government immediately starts proceedings for compulsory license [] for Cipro, wrestling the patent rights away from foreign company and competitor Bayer. This stance is widely praised as proactive and protecting the precious lives of US citizens.

    Year 2007: Tens of thousand of people die in Brazil each year from AIDS because they cannot afford patented medication. Action from Brazil to force compulsory licensing is widely denounced as destroying the worldwide pharma industry, especially by US commentators.


    • by kmac06 ( 608921 ) on Saturday May 05, 2007 @02:57PM (#19003517)
      From your link: "This quantity was far greater than the supply, and Bayer lacked the capacity to produce such a large quantity in a timely manner."

      Sounds like the manufacturers couldn't produce the drugs, so the government stepped in to ramp up production. Not exactly what you made it sound like.
    • The only company that could make it under license could only make a certain amount per year, and had no capacity to ramp up. They screwed around, claiming they could (but did nothing in particular). If they'd stepped forward and produced enough for the need, the US government would have happily paid the price.

      The compulsory license wasn't about cost. It was about capacity. And the US DID pay a license fee to the company, instead of outright theft, as Brazil is doing.

      On the other hand, with the amounts i
  • by bidule ( 173941 ) on Saturday May 05, 2007 @02:28PM (#19003239) Homepage

    Patents are government-granted monopolies. It is not an absolute right and has to be balanced against the need of the People.

    Reading this news as a fight between corporate greed and governmental greed is the wrong way to look at that. Right or wrong, you try to choose the lesser evil. Everyday the little citizen get crushed for reason of State, for once it is a big pharma that pays the price.

    BTW, the pharma spammer are quick on the button today. Disgraceful.
  • by Durzel ( 137902 ) on Saturday May 05, 2007 @03:03PM (#19003563) Homepage
    I have nothing against capitalism as a rule, and I'm not naive enough to believe in some twee fantasy World where life-saving medications are free for everyone all around the World. That said, setting a price point on what is an ESSENTIAL medication of $1.59 per pill when the same company already sells the same product to another country at $0.65 per pill is disgusting. Merck are (or were) essentially holding the Brazilian peoples lives to ransom.

    If Merck can afford to sell the product to Thailand for $0.65 and still make a profit (clearly as an Indian company can sell it for $0.45 and turn a profit themselves) then there is no reason whatsoever other than pure capitalistic greed why they could not have given the same offer to the Brazilian government. Don't forget we're not talking about the variable domain costs of marketing and staffing, the government is the customer - how the Brazilian government then choose to distribute/market the treatment is their decision and at their cost.

    There are a great many products around the World that are sold for different prices to different regions, but in practically all cases you can permit the corporations involved some latitude simply because the products they're selling are luxury or otherwise non-essential. Gouging a customer with a 300%+ markup on a life-saving drug when you know the customer/market HAS to have it is disgusting.

    Let's not forget that the research dollars that went into developing this particular drug came from U.S citizens.

    I don't think this is a sign of "erosion of respect in American patents", this is after all the first time the Brazilian government has even invoked the power of "eminent domain".
  • by d34thm0nk3y ( 653414 ) on Saturday May 05, 2007 @03:10PM (#19003625)
    From the Article:

    Other countries, including Canada and Italy, have also used a clause in World Trade Organization rules to flout drug patents in the name of public health.

    Under WTO rules, countries can issue a "compulsory license" to manufacture or buy generic versions of patented drugs deemed critical to public health.
  • bullshit (Score:3, Insightful)

    by nanosquid ( 1074949 ) on Saturday May 05, 2007 @03:15PM (#19003669)
    the Brazilian government has decided to take a 'compulsory license' to the patent, and get the drug from a factory in India. This compulsory license is basically a way to take the patent by eminent domain.

    A "compulsory license" is not the same as "taking a patent", it's a compulsory license, as the name implies.

    Furthermore, the term "eminent domain" simply doesn't apply to patents because patents aren't "private property". Patents are temporary monopolies granted by the government for a specific purpose, and revoking that grant when the patent doesn't accomplish its purpose is not the same as taking away "private property". The only thing the government is ultimately obligated to observe in the granting and revocation of patents is that it is done non-discriminatorily.

    Trying to equate a patent grant with private property is ideological bullshit; don't fall for it.
    • Re: (Score:3, Interesting)

      by vidarh ( 309115 )
      The other thing is that it's entirely up to Brazil whether or not they want their legal system to even recognize these patents in the first place. Patents aren't a "natural right" in any sense. As copyrights, patents are tools used by the government to encourage innovation for the benefit of the public. If they are being used in ways that harms the public, then it stands to reason that any government that cares about it's people would take action to correct it.
  • by compumike ( 454538 ) on Saturday May 05, 2007 @07:47PM (#19006135) Homepage
    From their latest annual report [], for fiscal year 2006: (all numbers in millions of dollars)
    • Sales revenue: 22,636.0
    So where does the money go?
    • Manufacturing costs: 6,001.1
    • Marketing & adminstrative costs: 8,165.4
    • R&D: 4,782.9
    Only 20% of the price of each pill goes toward future research and development... Marketing & administrative costs are double that. Ouch.

"I don't believe in sweeping social change being manifested by one person, unless he has an atomic weapon." -- Howard Chaykin