Glaxo to cut prices for poor countries
February 16, 2009
The Associated Press reports that GlaxoSmithKline will cut drug prices to the 50 poorest countries in the world and use 20 percent of its profits from those countries to build health clinics and other infrastructure, according to published reports. The company''s chief executive, Andrew Witty, also is proposing that drug companies, nonprofit groups and others donate their patents related to neglected tropical diseases to a common pool that could be used to speed development of new drug. Glaxo, the second biggest drug maker by sales, generates about $43 million annually in revenue from those countries. About $1.5 million to $2.5 million would be generated for the clinics. HIV drugs are already sold at not-for-profit prices in those countries, but the prices will be cut if the drugs aren''t already sold at prices below the threshold of 25 percent, reports said. Treatments for hepatitis B, genital herpes, malaria and asthma are expected to be affected by the plan. The report also said that Glaxo would not contribute its HIV patents to the pool. The company believes there already is innovation in HIV medicines because of the profit that can be made in Western markets.