Brazil's policy of haggling down the cost of AIDS drugs – and flouting international patents – saved the country $1 billion between 2001 and 2005, US researchers have revealed in the latest issue of Public Library of Science journal PLoS Medicine.

Little is known about the long-term costs associated with providing HAART (highly active anti-retroviral treatment) to HIV patients in developing countries. This prompted researchers from the Harvard School of Public Health to perform the first detailed analysis of AIDS drug costs in Brazil, whose free and universal access to AIDS drugs is considered a model for other countries attempting to boost their public treatment programmes. The policy is credited with having helped slowed infection rates to just 0.6 % of the population – similar to those seen in the USA.

The Harvard researchers found that, although it cost Brazil more to produce generic anti-retroviral drugs (ARVs) locally between 2001 to 2005, the country still saved approximately $1 billion overall in that time period by using its stance on generics as a bargaining tool with drug multinationals on other expensive HIV drugs; since 2001, Brazil has effectively obtained lower prices for ARVs by threatening to ignore their patents.

Brazil currently produces generic versions of eight non-patented AIDS drugs. The country has signed up to World Trade Organisation patent agreements, but has cited WTO terms that allow countries facing a health emergency to produce patented drugs without the owner's consent.

Pharmaceutical industry figures have warned, however, that such actions could discourage companies from conducting the expensive research needed to develop new drugs. A spokesman for the International Federation of Pharmaceutical Manufacturers said Associations said: "Brazil's overall campaign has to be applauded." He added, however: "Brazil used threats of compulsory licensing to obtain prices that the industry was voluntarily offering the poorest countries, and Brazil as one of the top twenty economies in the world is clearly not in the same category as Losoto."

Last May, Brazil broke the patent on Merck's Sustiva/Stocrin (efavirenz) to import a cheaper generic version from India instead but in July, it worked out an agreement with Abbott Laboratories to cut the price of its drug Kaletra (lopinavir/ritonavir) by 29.5%. Other countries, including Canada and Italy, have also used a clause in WTO rules to flout drug patents in the name of public health.

However, the Harvard researchers warn that even with the savings, Brazil faces a tough time ahead.
"It faces significant challenges with the rising cost of providing universal access to AIDS treatment," said lead researcher Dr Amy Nunn, adding that HAART costs in Brazil more than doubled from 2004 to 2005. The steep rise reflected the fact that more people with HIV were on treatment and were living longer – and increasingly requiring complex, second- and third-line treatments as a result of resistance to first-line drugs.

The World Health Organisation estimates that only two million people in developing countries receive HAART. This number represents just a quarter of those in need of treatment in these countries. By Michael Day