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Brazil has issued a compulsory licence to begin importing generic versions of a popular HIV/AIDS drug.

Brazilian president Luiz Inácio Lula da Silva signed a decree last week (4 May) issuing compulsory licensing for the HIV/AIDS drug efavirenz, made by pharmaceutical company Merck & Co. The patent for efavirenz is in force until 2012.

The announcement comes after the health ministry rejected Merck's offer on Thursday (3 May) to drop the price per pill by 30 per cent, reasoning that it is still higher than the price being offered to Thailand.

Mariangela Simão, coordinator of the National Program of Sexually Transmissible Diseases and AIDS, told news agency Agencia Estado yesterday (7 May) that they expect the first generic consignment to arrive "by the end of June or beginning of July". They will import 13.5 million units of the generic version of efavirenz.

Efavirenz is the most used HIV/AIDS drug in Brazil. According to the Health Ministry, 38 per cent of the country's HIV/AIDS patients take it, and around 75 thousand people will be taking the drug by the end of 2007.

Supplying a patient with Merck's efavirenz for one year costs Brazil US$580, about US$1.59 per pill. A generic treatment for a year would cost around US$166, around US$0.45 per pill.

Importing generic versions of the drug will save Brazil around US$30 million in 2007, and nearly US$236.8 million by 2012.

The compulsory licence allows the Ministry of Health to import generic versions of efavirenz from laboratories certified by the World Health Organization ― currently Aurobindo, Cipla and Ranbaxy in India.

In an interview with the Pharma Times, a representative from Merck said the move "sends a chilling signal" to companies about the risks of developing drugs for diseases that affect the developing world.

They added that pharmaceutical companies cannot "sustain a situation in which developed countries alone are expected to bear the cost for essential drugs" in the developing world.

Simão said that the government is still willing to discuss the situation with Merck, despite the official publication of the compulsory license.

Late last year, Thailand also announced it would break the patent on efavirenz, and in January this year threatened to do the same for the HIV/AIDS drug Kaletra, as well as a heart medication (see Thailand backs off threat to break drug patents).