20 November 2002
We stand here today representing:
Out of a population of about 46 million, approximately 5 million South
Africans are living with HIV/AIDS. Current estimates suggest that at least
500 000 South Africans need antiretroviral (ARV) treatment. Research
conducted by the University of Cape Town shows that without treatment, at
least 3 million South Africans will die by 2015.
HIV/AIDS is the leading cause of mortality in-and greatest public health
threat to-South Africa. While government's commitment to offer quality
treatment for people living with HIV/AIDS is now beginning to emerge, the
high price of ARV therapy continues to prohibit the implementation of
community treatment programmes that are desperately needed in the public
sector.
For people who earn salaries and who could otherwise acquire ARV drugs
themselves, the prices charged by pharmaceutical companies for ARV drugs
has led to people either not being able to afford treatment at all or to
people opting for substandard treatment regimens. High drug prices limit
the treatment options of many people living with HIV/AIDS especially in the
event of treatment failure or the inability to tolerate particular drug
regimes.
There are currently only about 20 000 people on ARV therapy in SA. Most of
them access ARV drugs through their medical aid. This is the only way that
they are able to afford ARV therapy. However, in many cases medical aid
benefits dry up before the end of the year due to the high prices of ARV's,
which often means that they have to discontinue or interrupt treatment.
This is unsafe and should not have to happen.
For workers in smaller companies where employers are seeking ways of
implementing treatment programmes, the price of ARV drugs remains a major
obstacle to gaining sustainable and meaningful access to comprehensive
treatment programmes that include ARV drugs.
About 300 000 South Africans died of AIDS related illnesses in the past
year. However, the pharmaceutical industry remains the most profitable
industry in the world. For the past five years, the profits of the
pharmaceutical industry have continued to increase, even in the face of
global economic decline and market failure.
In 1999, GSK made US$245 million in profits from the sales of Combivir
alone. Despite the massive profits made from manufacturing and selling
drugs such as AZT, GSK continues to charge excessive prices, making it
impossible for many people living with HIV/AIDS with little or no income to
afford buying these medicines.
While Africa constitutes only 1% of the industry's ARV market, the damage
done by the extensive profiteering of drug companies such as GSK continues
to needlessly kill millions of people living with HIV/AIDS in Africa.
Through the Competition Commission complaint, we aim to challenge the abuse
by the pharmaceutical industry of their dominant market position as well as
challenge the excessive prices charged for life saving and essential ARV
drugs. GSK charges ZAR 9. 70 for one tablet of AZT, while the WHO
pre-qualified generic version of AZT costs only ZAR 2, 59. Taking into
account that AZT has been on the market for more than 10 years now, the
need to accrue additional research and development costs can no longer be
used to justify these high prices.
Other generic companies, which are unable to enter the market because of
the monopoly that GSK enjoys, are able to produce generic AZT at much lower
prices. Your profits are unjustified.
Through the competition commission, we aim to prove that GSK has engaged in
excessive pricing of ARVs to the detriment of consumers, as prohibited by
section 8(a) of the Competition Act, 89 of 1998 (the Act). These excessive
prices are directly responsible for the unnecessary suffering and
premature, predictable and avoidable deaths of all adults and children
living with HIV/AIDS.
We demand GSK to:
Issue non-exclusive voluntary licenses on the medicines that are the
subject of the complaint on a 5% royalty fee basis.
We believe that the voluntary license offered to Aspen Pharma-care is a
mere transfer of GSK's monopoly. The fact that it is limited to the public
sector and NGOs and only for domestic use shows that it is not a genuine
offer to expand access to treatment to all people living with HIV /AIDS in
need of ARV drugs. The 30% royalty fee will also result in higher prices
being charged, excluding those who could afford the drugs at lower prices
than is currently charged. We demand that GSK extend the terms of this
license to the private sector.
Stop the abuse of your dominant market position in South Africa.
Signed:
Ntombi Mbuthu (in Durban)
Nomfundo Dubula (in Cape Town)
Mandla Majola (in Durban and Cape Town)
TAC Provincial Executive member
TAC Treatment Literacy Co-ordinator, Western Cape
TAC Provincial Co-ordinator
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