GSK announced significant new price reductions for its HIV medicines offered on a not-for-profit basis to the world's poorest countries. This reduction is the fifth time the company has made a price reduction as part of its pioneering preferential pricing policy originally introduced in 1997.
According to a press release, the price reductions will apply across the range of GSK's antiretrovirals offered at not-for-profit prices. The most significant reduction, of almost 40 per cent, will be on Ziagen oral solution (abacavir), which is recommended by the World Health Organization (WHO) for use in first-line and second-line regimens within resource-limited settings, particularly for children. The average reduction across GSK's 14 not-for-profit HIV medicines is 21 per cent. These prices will take effect immediately for public sector customers and not-for-profit organisations in all the Least Developed Countries and Sub-Saharan Africa, as well as countries with eligible Global Fund and PEPFAR projects.
A number of factors have enabled GSK to implement these price changes, including improvements and efficiencies in manufacturing and supply, and reductions in the costs of active ingredients. These latest prices have been calculated based on the cost incurred by GSK, and savings realised are reflected in the new prices and passed on directly to purchasers. The prices include insurance and freight and are applicable to orders of any size and are not dependent on quantity.
JP Garnier, CEO GlaxoSmithKline said: "I have seen for myself the devastating impact of HIV/AIDS, and the continued response of the global community to this epidemic is vital. This further reduction in pricing of our HIV medicines demonstrates GSK's ongoing commitment to patients in the world's poorest countries. We also continue to focus on the research and development of new medicines and vaccines, and to build partnerships with others to help improve access and investment in communities."
GSK is a leading supplier of HIV/AIDS medicines and also an industry leader in the research and development of medicines and vaccines for diseases of the developing world, including HIV/AIDS vaccines. GSK is the only company researching the prevention and treatment of all three of the World Health Organisation's priority infectious diseases in the developing world: HIV/AIDS, malaria and tuberculosis.
This announcement reflects GlaxoSmithKline's long-standing and continuing commitment to improve access to medicines in developing countries. GSK has been offering substantial discounts on vaccines to governments, charities and agencies for public health programmes for over 20 years.
GSK pioneered sustainable preferential pricing for antiretrovirals in 1997, when the company made Retrovir available for use in mother-to-child transmission reduction programmes in the developing world at up to 75% off the global price. In 2000, the company became a founding member of the Accelerating Access Initiative (AAI), a public-private partnership to increase sustained access to appropriate, good quality intervention in the fight against HIV/AIDS, including antiretroviral therapy.
In 2001, the company expanded its access programme, lowered its preferential prices and extended not-for-profit preferential pricing to more customers, countries and medicines. It also promised to continue to find ways to reduce costs and pass those savings on to patients, this is the 5th price reduction since then.
GSK's single, not-for-profit prices are available to a wide range of customers in the United Nation's list of Least Developed Countries and all of sub-Saharan Africa - a total of 64 countries. They are also available to all CCM projects fully financed by the Global Fund to Fight AIDS, TB and Malaria and by PEPFAR. Eligible customer groups include governments, non-governmental organisations (NGOs), aid agencies, UN agencies and other international purchase funds. Additionally, in sub-Saharan Africa, employers who offer HIV/AIDS care and treatment to uninsured staff are also eligible for GSK's not-for-profit prices for antiretrovirals.
To facilitate the distribution of affordable product in relation to this voluntary licence, Shire plc, which has a Master Licence agreement with GSK, has agreed to waive or reduce its rights to royalty payments from GSK for products containing lamivudine.