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Cipla offers free AIDS drug to government, NGOs

Rajesh Unnikrishnan

Cipla, India's second largest pharma company, has offered a free supply of its AIDS drug for two years to the government and non-governmental organisations. The move is expected to create a major price war in the domestic AIDS drugs market.

In return, Cipla has asked the government to reduce customs and sales tax duties to its other AIDS drug formulations to facilitate the "humanitarian" effort.

Recently, in February, Cipla had reduced its AIDS drug prices globally by 35 per cent from Rs 6,480 to Rs 4,230 which put global majors like Glaxo SmithKline, Merck & Co, Bristol Myers Squibb, Boehringer Ingelheim and Pfizer under tremendous pressure to reduce their AIDS drug prices also.

MK Hamied, joint managing director of Cipla, said: "We have put forward a proposal to the government, offering a free supply of nevirapine tablets which prevents mother-to-child HIV transmission."

Hamied added this was only the first of similar steps the company was planning regarding its AIDS formulations. Duovir, Stavir-30, Stavir-40, Lamivir, Lamivir HBV are the other AIDS drug brands of Cipla.

Currently, Cipla sells nevirapine at around Rs 650 for a strip of ten, after it offered a discount of 34 per cent on the earlier price of Rs 985 per strip.

Analysts say that, if accepted, the Cipla move could allow it to establish its product in the Indian market. This would pressurise Glaxo SmithKline, the only MNC present in India with its AIDS drugs, to cut prices.

In India, local companies such as Zydus Cadila, Hydrabad based Ginix Pharma and Ambalal Sarabhai are the other leading players in the AIDS drug segment, and they would all have to reduce prices.

Glaxo is importing its formulation and selling it in the Indian market for a price ranging between Rs, 2,000 to Rs 4,920. The company is selling its Apivir brand for Rs 2,460 (60 tablets), Retrovir for Rs 2,000 (100 tablets) and Combivir for Rs 4,920 (for 30 tablets).

Besides, two other domestic drug majors, Ranbaxy and Aurobindo Pharma, are also planning to enter this segment. But the price war could create entry barriers, analysts said. In the last three years, Cipla has cut its AIDS drug prices five times because of "technological improvements" in its manufacturing facilities.

This is despite the fact that Cipla does not hold patents for these drugs. As Indian laws permit patenting of process, and not products, Cipla has been able to replicate these drugs through a different and cost-effective process.

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