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.


Ntombi Mbuthu (in Durban)
TAC Provincial Executive member

Nomfundo Dubula (in Cape Town)
TAC Treatment Literacy Co-ordinator, Western Cape

Mandla Majola (in Durban and Cape Town)
TAC Provincial Co-ordinator

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