OVERPRICING
80% of AIDS medication comes from patents that belong to GSK and Abbott. Abbott alone has earned 1.5 billion dollars a year in Lopinavir sales. This medication was key to turn VIH/AIDS into a non-fatal disease, and it became the brand’s flagship since 2001.
“Since the beginning of the AIDS crisis, the pharmaceutical industry has increased its profits in millions, resulting in a scheme of “Profit with misery and calamity”-Joaquín Hurtado Pérez (AIDS patients’ rights advocate).
17 MILLION QUETZALES OVERPRICE
In 2017, Guatemala lost over 17 million quetzales in overpriced procurements, 92% of which was due to output limitation such as copyright or company data protection. This is explained by the Social Audit of the Procurement of Antiretroviral Medicine, drawn up by the International Treatment Preparedness Coalition (ITPC).
The investigation revealed that in 2017, the state paid 39,230,099.66 quetzales (Q) for antiretroviral drugs, but according to ITPC, they could have been purchased for Q 21,807,984.24. This means that 17 million quetzales could have been saved if there were no legal barriers.
LEGAL BARRIERS CAUSE OVERPRICING
Ideally, International Treaties and Agreements help to cut costs, but legal barriers such as patents may offset these benefits.
One of the best examples is the Lopinavir/Ritonavir combination, which has been the medication with the most money invested in: Q 72,000,000 since 2011. This is a crucial medicine to treat AIDS as it works for all three therapy lines. Besides, it is essential to keep pregnant women from transmitting the virus to their children. The drug is no longer patent-protected in most countries, but still is in Guatemala.
LOCAL PURCHASES ARE EXPENSIVE
The remaining 8% of overpriced purchases are a result of uncompetitive practices, not using scale economies, and issues related to administrative formalities. These happen when the government purchases antiretrovirals from local laboratories instead of international organizations.
One of the examples is related to the Abacavir 20mg purchase of 2017. This case shows the weaknesses in local purchases: the laboratory price was 3.30 times higher than the reference price set by the Pan American Health Organization.
