Pharmaceutical Companies, Intellectual Property, and the Global Aids Epidemic

932 Words Jan 1st, 2013 4 Pages
In this case study I was asked six question the first one was,Do pharmaceutical companies have a responsibility to distribute drugs for free or at low cost in developing countries? What are the main arguments for and against such an approach?
While this case is literally full of negative aspects, we will only focus on the main points for both arguments. Pharmaceutical companies want to be sure that the products they spend years and millions of dollars to create are not easily reproduced and sold at discount prices. The profits pharmaceuticals make of their patented products are supposed to refinance new research. So taking away their exclusive distribution rights and allowing other manufacturers to just copy the product and sell it at
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Discounted prices make political, economic, and, most importantly, moral sense.
Although ninety-five percent of people living with HIV/AIDS are in developing countries, the impact of this epidemic is global. In South Africa, where one in four adults are living with the disease, HIV/AIDS means almost certain death for those infected. In developed countries however, the introduction of antiretroviral drugs has meant HIV/AIDS is treated as a chronic condition rather than a killer disease. In developing countries like South Africa, the drugs that allow people to live with the disease elsewhere in the world, are simply too expensive for individuals and governments to afford at market price.
Drug prices are set by pharmaceutical companies to cover research and development costs. While R&D costs clearly need to be covered, markets in developed countries already pay for most R&D of new products. Because of this, it makes moral and economical sense to establish a two-tiered pricing system; for R&D costs to be paid for by developed countries, allowing significantly reduced prices to be charged in developing countries.
Pharmaceutical companies had been reluctant to provide drugs to developing countries at reduced prices because of concerns around distributing drugs in unregulated and unreliable environments. They argued that this could create new drug-resistant…

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