No time to wait: taking legal action to increase access to HIV medicines: No time to wait: taking legal action to increase access to HIV medicines Jonathan Berger Senior Researcher AIDS Law Project SOUTH AFRICA Bridging Session Access to Treatment: People Before Trade Wednesday, August 16th 2006 XVI International AIDS Conference _________________________________________________________


Overview of presentation: Overview of presentation _________________________________________________________ South African context Access concerns Political context Constitutional framework Case studies Hazel Tau vs. GSK and Boehringer Ingelheim BMS’s Amphotericin B (Fungizone®) Concluding thoughts


South African context: South African context _________________________________________________________ Access concerns Excessive pricing Sustainability of supply Political context Government inaction Civil society leadership Constitutional framework Socio-economic rights protections Positive state obligations Interpretation of all legislation


Case studies: Case studies _________________________________________________________ Hazel Tau vs. GSK and Boehringer Ingelheim Focus on three essential ARVs: AZT, 3TC and NVP Patent-protected No generic competition Excessive private sector prices BMS’s Amphotericin B (Fungizone®) Gold standard for cryptococcal meningitis Off-patent No generic competition Excessive public and private sector prices


Tau v GSK and BI: Tau v GSK and BI _________________________________________________________ GSK and BI alleged to have “engaged in excessive pricing of ARVs to the detriment of consumers” Conduct was alleged to be – Directly responsible For the premature, predictable and avoidable deaths Of people living with HIV/AIDS In contravention of section 8(a) of the Competition Act, 89 of 1998 As interpreted in light of the Constitution


What had to be proven?: What had to be proven? _________________________________________________________ Charging a price for a good or service which – Bears no reasonable relation to the economic value of that good or service; and Is higher than this value What makes up the economic value? Manufacturing costs R&D costs (where applicable) Licensing costs (where applicable) Reasonable profits ??? Reasonable relation = balancing of rights


Resolution by settlement: Resolution by settlement _________________________________________________________ Matter settled in December 2003 Avoided Competition Tribunal public hearing Complex legal issues remain unresolved Implementation of settlement Excessive pricing complaint, but licensing solution Reasonable terms and conditions Public and private sectors Imports and/or local production of products (including FDCs) Exports of locally produced ARVs to sub-Saharan Africa 5% royalty maximum (including for FDCs)


Price reductions: Price reductions _________________________________________________________


Amphotericin B: Amphotericin B _________________________________________________________ Need for access Cryptococcal meningitis has 25 – 40% mortality rate in people living with HIV/AIDS Limited use in public sector primarily as result of price Private sector price even higher Legal action Threat of excessive pricing action Request for justification of pricing policy Matter settled after series of letters Private/public divide overcome Price reduction of between 80% and 85%


Concluding thoughts: Concluding thoughts _________________________________________________________ Civil society took the lead No government-issued licences under Patents Act Not even threats of issuing licences State willing to let civil society do its “dirty work” Chilling effect of TRIPs+ compulsory licensing provisions Failure to implement Doha Declaration No licences issued by courts on any patented products No applications for licences by generic manufacturers of ARVs Need for regulatory reform Express licensing remedy for excessive pricing Implement the Doha Declaration


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