Bristol-Myers Squibb Will Not Sue South African Generic Manufacturer Over AIDS Drugs

In a letter faxed yesterday to officials at Aspen Pharmacare Ltd. Holdings, South Africa's largest generic drug maker, Bristol-Myers Squibb Co. said it would not initiate a lawsuit against the company in the next five years if it chooses to manufacture and/or sell in sub-Saharan Africa generic copies of Bristol-Myers' antiretrovirals Videx and Zerit, the Wall Street Journal reports. "This document is designed to give you clear comfort that you will not be sued by us, as set forth specifically in the Agreement, for your manufacture or sale of the covered products in sub-Saharan Africa," the letter, signed by Bristol-Myers Senior Manager Robert Lefebvre, said. The proposed "immunity from suit" agreement would be renewable at Bristol-Myers' "discretion" and could be voided if the drugs were exported for sale outside of sub-Saharan Africa. If the deal is approved by Aspen, it would make Bristol-Myers the first major pharmaceutical company to permit a generic drug maker to produce and sell a patented drug in sub-Saharan Africa, setting a precedent that "might broaden access to AIDS drugs" by "prompt[ing] other major drug companies to follow suit," the Journal reports.

Let's Make a Deal
In May, a South African Bristol-Myers manager was quoted by local papers as saying that the company would grant a license to produce or manufacture Zerit and Videx, whose patents expire in 2007 and 2012 respectively, to any company that could beat the combined $1-a-day price it had offered in March. Aspen requested such a license in a letter dated May 31. Under Aspen's proposal, Indian generic drug maker Hetero Drugs Ltd. would supply the raw materials necessary to make the drugs. Bristol-Myers officials said that the local manager's offer was a "misstatemen[t]" but that yesterday's proposal not to sue was in "keeping with the commitment" to offer low-cost drugs that the company made in March. "We went the route that allows us to do exactly what we said we'd do. We do not feel that we want to engage in a business relationship with Aspen and so we feel this response is adequate," Lefebvre said. Aspen officials did not comment yesterday on whether or not they will take up the offer, but previously "expressed doubts" about such an arrangement. Aspen CEO Stephen Saad last week said, "Some other companies might be comfortable to proceed with a letter, but for Aspen, it is not a position we are comfortable with." Yale University, which holds the patent on Zerit, supports the proposal. "We are in favor of getting these drugs out as quickly and cheaply as possible," university representative Karen Peart said (Zimmerman et al., Wall Street Journal, 7/19). Protests by Yale students and professors were instrumental in getting Bristol-Myers to lower the cost of the drug in March (Kaiser Daily HIV/AIDS Report, 3/15).