Abbott has issued a statement condemning the decision by Brazil’s government to subject its HIV drug Kaletra (lopinavir/ritonavir) to a compulsory license, freeing local companies to start making it in defiance of the US drugmaker’s patent position.

Last week, Brazil gave Abbott ten days to reduce the cost of Kaletra supplies to Brazil by 42%, to $1.17 per pill, or lose its exclusivity in the country. The Brazilian government intends to grant a license to local company Farmanguinhos Laboratory, which will produce the drug for public use only. The country insists this measure is in accord with the TRIPs (Trade-Related Aspects of Intellectual Property Rights) agreement, and specifically the Doha amendment that allows developing countries to temporarily suspend patents on products needed to alleviate a legitimate health crisis.

In its defence, Abbott argues that Brazil receives Kaletra for the lowest price in the world outside of Africa and the countries given “Least Developed” status by the United Nations. “In these countries, Abbott loses money on Kaletra sales through the Abbott Access humanitarian programme,” said the drugmaker. Brazil has the world’s ninth largest economy, it continues, so its demand that it is should receive the same relief as developing countries “is counter to the spirit of the TRIPS agreement.”

In March, Brazil threatened not only Abbott but also Merck & Co and Gilead Sciences with compulsory licenses for their HIV drugs Sustiva (efavirenz) and Viread (tenofovir), although at the time of writing no ultimatums had been delivered regarding the latter products.

“Negotiations with Merck and Gilead continue. Abbott was the only one to oppose both the alternative voluntary licensing as well as a price reduction which guarantees the future sustainability of the programme,” said Brazil’s Ministry of Health in a statement.

The country is committed to providing free HIV/AIDS treatment to anyone who needs it. However, its actions on compulsory licensing have been criticised by the Institute for Trade, Standards and Sustainable Development, an international think tank which, in a recent report, described Brazil as “by far the worst abuser of intellectual property rights in the Americas.”

Kaletra remains one of Abbott’s top-selling drugs, bringing in revenues of $238 million dollars in the first quarter of this year [[13/04/05d]].