Indian firms, Clinton Foundation sign deal on malaria drugs

July 18th, 2008 - 3:56 pm ICT by IANS  

New York, July 18 (IANS) Four Indian and two Chinese companies will cut the price of a key malaria drug and control rates of a vital ingredient following a pact signed Thursday with the US-based Clinton Foundation, which works towards finding solutions to issues such as poverty and healthcare. The Indian companies are generic drug firms Cipla and IPCA Laboratories, which manufacture malaria drugs called Artemisinin-based Combination Therapy (ACT), and Calyx and Mangalam Drugs, which turn the artemisinin plant extract into an active pharmaceutical ingredient.

China’s Holleypharm and PIDI Standard grow the plants.

Under the deal announced by former president Bill Clinton, the Chinese suppliers have agreed to supply raw artemisinin at a fixed price.

The Indian companies have given the Chinese firms a guarantee of purchase, and will sell their products at agreed-upon low wholesale prices.

Cipla and IPCA have agreed to offer two of the most widely used ACT drugs at prices 30 percent below market rates.

The supply of artemisinin, a plant extract that takes up to 14 months to produce, has been volatile, with prices ranging from $150 to $1,100 per kilogram in the past four years.

But ACT drugs are still in high demand, as over the past few decades, malaria carriers have become resistant to the drug that has been used to treat the disease for years.

”This agreement will reduce the prices for ACT drugs by 30 percent,” Clinton said while announcing the deal.

“We are also reducing the price volatility of artemisinin by 70 percent, making the drugs cheaper substantially and enabling governments to stretch their limited dollars to reach millions more patients every year.”

Up to 500 million people around the globe need malaria treatment each year. The lower prices for the ACT drugs will be available to the 69 countries in Africa, Asia, Latin America and the Caribbean that make up the Clinton HIV-AIDS Initiative (CHAI) purchasing consortium.

“Nearly every life lost to malaria could have been saved with access to effective medicines,” Clinton said. “My Foundation has helped organise markets for HIV-AIDS drugs, and I am proud that we have been able to extend this model to malaria.”

Swiss firm Novartis has so far been the dominant ACT drug supplier and has been able to absorb the volatile costs of artemisinin rather than passing it on to patients. The company said it has lost more than $100 million on the drug.

“We know first-hand addressing the health problems of the developing world is challenging and no single player can be successful,” said Daniel Vasella, chairman and chief executive officer of Novartis, who accompanied Clinton at the presentation.

The Clinton Foundation said currently about 100 million doses of ACT drugs are distributed a year. It has forecast that demand for ACT drugs will at least double over the coming four years and could grow to more than 400 million doses annually if a global subsidy plan is agreed.

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