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Aurobindo bests Cipla cheap AIDS drug offer

Drugmaker Aurobindo Pharmaceuticals has offered to supply an AIDS triple drug cocktail to the world's poor at $295 per patient per year -- lower than the price offered by rival Cipla in February.

Aurobindo's managing director Ramprasad Reddy said on Wednesday his company, like Cipla, had made its offer to international charity Medecins Sans Frontieres, other non-government organisations, and foreign governments.

"Ours is probably the lowest price in the world," he said by telephone from his office in Hyderabad.

"We have made an identical offer at $295 to all buyers, and there are no conditions attached," he added.

The drug cocktail costs between $10,000 and $12,000 per year per patient in developed countries.

Cipla, India's third-largest drugmaker, shook the global drug industry by offering the three drugs at $350 per patient per year.

It was soon followed by a small unlisted firm Hetero Drugs which said it could supply the drugs at $347.

Aurobindo is based in Hyderabad, and is well respected in the industry as a low-cost producer of bulk drugs, those that go into ready-to-take medications or formulations.

It started making AIDS formulations only three months ago.

"We followed our initial offer to MSF with letters to Unicef, Unaids, the World Bank, and multilateral aid agencies, and expect a team from the World Health Organisation to inspect our facilities after they study our proposal," Reddy said.

Aurobindo shares were down 0.51 per cent at Rs 216.80 in afternoon trade, while the benchmark Bombay index was down 0.76 per cent.

The shares have fallen around 56 per cent since the beginning of the year, while the index has lost around 14 per cent over the same period.

Target South Africa

Reddy said Aurobindo was in the process of filing registration dossiers for the drugs in South Africa, Namibia, Zimbabwe, Brazil and a few other countries.

He said the facilities had already been approved by the South African drug authorities.

Asked how his company managed to offer the drugs so cheap, he said it was partly because it made all the raw materials itself.

"We are just about breaking even or making small profits on these drugs," he said.

"It is more of a humanitarian initiative."

The three drugs in the cocktail are stavudine, nevirapine and lamivudine.

US giant Bristol-Myers Squibb has a patent on stavudine, Germany's Boehringer Ingelheim the patent on nevirapine and GlaxoSmithKline the patent on lamivudine.

Indian drugmakers like Cipla and Aurobindo are able to make the drugs because Indian patent laws protect only the process by which a drug is made and not the drug itself.

This means Indian firms can copy drugs legally as long as they use a different process to make them.

Cipla's offer prompted multinationals to cut prices.

Bristol-Myers announced in mid-March it would supply Zerit, the brand name for stavudine, and another AIDS drug, Videx, at $1 a day to African AIDS patients.

Merck and Co also unveiled price cuts for two AIDS drugs, Crixivan and Stocrin, for developing countries.

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