Cipla gets Malaysian nod for AIDS drugs

In a trailblazing move, Malaysia has issued a compulsory licence to Mumbai-based Cipla for the supply of anti-retroviral medicines used in the treatment of Acquired Immuno Deficiency Syndrome (AIDS).

This is the first compulsory licence issued by any government after the August 30, 2003, decision on Para 6 of World Trade Organisation's (WTO) Trips agreement, which allows countries to waive patent claims and source medicine from low-cost non-patent producers in case of a public health crisis.

The details of the compensation to Bristol-Myers Squibb and GlaxoSmithKline are yet to be worked out by the Malaysian government.

Senior government officials said that according to the decision at the Trips Council, the compensation would be based on the economic value.

The economic value would be worked out on the basis of per capita income in Malaysia and the value of each life which would have been lost in case the drug was not supplied by waiving patent rights.

They added that orders for more medicines, particularly to combat AIDS in Africa, were in the offing and the ministry of external affairs and finance were working out the details for a line of credit for pharmaceutical exporters.

While the corpus of the fund could be over $1 billion, the details are yet to be finalised, an official said. Exim Bank would be the nodal agency for extending the lines of credit.

Commenting on the development, Indian Pharmaceuticals Alliance secretary general DG Shah said, "It could provide an interesting test case to assess whether the August 30 decision is workable or needs modification."

Cipla's designated spokesperson, joint managing director Amar Lulla, could not be reached for comments.

However, other pharmaceutical companies said that this could pave the way for other countries to issue similar licences to low-cost drugmakers in India.

Cipla has been at the forefront of the campaign to provide anti-retroviral medicines to developing countries at a fraction of the cost of companies which innovated these drugs.

The campaign received a significant shot in the arm last year when the Bill Clinton Foundation announced that it would source medicine for the treatment of AIDS in Africa from three Indian companies "" Cipla, Ranbaxy and Matrix "" and a South African company.