NCPA - National Center for Policy Analysis


November 11, 2004

The U.S. Government is paying twice as much for many of the drugs in its global AIDS program as other international organizations, reports the Wall Street Journal.

A draft report by the Government Accountability Office shows that the United States is paying $562 per person annually while other international AIDS groups not bound by U.S. restrictions are paying $215. The stark price differences mean that President Bush's five year, $15 billion global AIDS fund won't go as far as it could have.

The Bush administration is criticized for not buying Indian-made drugs that combine three AIDS medications into one pill, cutting the daily number of pills patients must take from six to two. Unfortunately, the Indian drugs violate U.S. patent laws because they are copies of brand-name products. According to the U.S. AIDS coordinator's office, a survey of selected grantees found:

  • The difference between buying the cheaper Indian drugs and more costly brand-name drugs adds about 16 percent to the cost, about $200 per patient per year -- or $13 million more for the 57,000 patients the grantees plan to serve this fiscal year.
  • The United States pays nearly $450 per patient annually for Boehringer Ingelheim's nevirapine; generics available to other treatment programs run $120 to $170.
  • GlaxoSmithKline PLC's zidovudine costs the United States about $200 annually per patient, compared with $125 to $175.

The Bush administration says it regards the issue as one of drug safety rather than a fight over generic versus brand-name drugs. The administration has said it will purchase the drugs for overseas use, however, as long as the U.S. Food and Drug Administration says they are safe.

Source: Sarah Lueck, "U.S. Pays High Prices for Global AIDS Drugs, Study Says." Wall Street Journal, October 29, 2004.

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