BRAZIL:
Ten Years After

Brazil soon became a poster child for the access movement, which argues that everyone, everywhere can have antiretroviral drugs by purchasing knockoffs--outside Brazil, mostly made by generic drug companies in Asia--and by hard bargaining with Big Pharmas. By the end of 2005, 1.3 million HIV-infected people in poor and middle-income countries were receiving steeply discounted drugs, up from 240,000 in 2001. Brazil today has 180,000 people on antiretroviral drugs; 20% are made in the country, and the rest are purchased from Big Pharmas--typically after the government stages heated, much publicized, negotiations to exact price breaks.

As aggressive as Brazil has been about confronting Big Pharma, a growing number of insiders are criticizing the country for going soft and too readily acceding to Big Pharma's wishes. Brazil manufactures only eight antiretroviral drugs, all of them older preparations. Fourteen newer drugs offer many advantages, such as fewer side effects, more potency, and effectiveness against many drug-resistant viruses. Although Brazil has repeatedly threatened to break patents and make copies of these newer drugs, each time push has come to shove, government officials have backed down and cut deals with the Big Pharmas that have made some leading Brazilian AIDS researchers and activists blanch. "This has been a huge disappointment for us," says Pedro Chequer, who twice headed Brazil's national AIDS program and now works for the Joint United Nations Programme on HIV/AIDS (UNAIDS). Alexandre Granjeiro, another former head of the AIDS program, says Brazil must violate patents and risk incurring the wrath of Big Pharma and other industries that hold fast to intellectual-property regulations. "It's important to the world," says Granjeiro, who is director of the São Paolo State Health Institute. "If we make this ball roll here, it will make the ball roll everywhere."

Turnaround?
In 1992, the World Bank predicted that Brazil would have 1.2 million infected people by 2000. But because Brazil meshed aggressive prevention efforts with its pioneering treatment program, this dire prediction has not come true. According to UNAIDS estimates, at the end of 2005, 620,000 Brazilians were infected with HIV. The adult HIV prevalence in the country is a modest 0.5%, but because it is the most populous country in Latin America with 188 million residents, Brazil still accounts for more than one-third of the HIV/AIDS cases in the region.

As in North America and Europe, AIDS first surfaced in Brazil in upper-middle-class gay men, many of whom were politically active in the democracy movements that blossomed when 2 decades of military rule ended in 1985. "The community movement became extremely well organized, more than in the United States," says Ezio Tavora dos Santos Filho, a prominent AIDS activist who learned of his infection that year. In 1988, when Brazil rewrote its constitution, it declared that health care was a right, and 3 years later, the country offered HIV-infected people free AZT--then the only antiretroviral drug on the market.

By 1992, the virus had spread far and wide, with equal numbers of AIDS cases that year occurring in gay and bisexual men, heterosexuals, and people who injected cocaine--but still, it did not take off to the degree once feared. It's difficult to untangle precisely why, although Chris Beyrer, an AIDS epidemiologist at Johns Hopkins Bloomberg School of Public Health in Baltimore, Maryland, and co-author of a 2005 World Bank case study of Brazil, credits aggressive prevention campaigns. The Ministry of Health alone tripled the number of condoms it distributed between 2000 and 2003, the report notes, and government and nongovernmental organizations alike boldly reached out to gay men, sex workers, and injecting drug users.

Other factors contributed as well, says Beyrer. Antiretroviral treatment lowers the level of virus, likely making recipients less infectious. And the availability of treatment encouraged people to undergo HIV tests, which in turn can lead those who are infected to take more precautions. A change in drug-use trends--injecting cocaine largely fell out of fashion as many users switched to smoking the drug--contributed to the declining spread of HIV, too. "Brazilians hold on to how severe their epidemic is, but the bottom line is it could have been much worse," says Beyrer. And because Brazil controlled HIV's spread early on, he says, it made offering state-of-the-art treatment to everyone in need much more feasible.

Provocative prevention. Gabriela Leite heads Davida, an NGO for sex workers that launched a clothing line to raise money to fight the spread of HIV.

State pharma. Farmanguinhos head Eduardo Costa hopes to ramp up production of antiretroviral drugs at the company's new high-tech plant. SOURCE (INSET): MINISTRY OF HEALTH, BRAZIL

Nor have the disaster scenarios of the rapid spread of drug-resistant strains come to pass. "We don't have any evidence of primary resistance increasing," says Amilcar Tanuri, who runs a molecular biology lab at Fundão Isla in Rio, a branch of the Federal University, referring to the spread of resistant strains between individuals. Yet Tanuri notes that "secondary" drug resistance, which develops while on treatment, is becoming more widespread, requiring many to change their medicines. "There's no way around it," he says. Combine that with the growing number of people on treatment, and Brazil is now faced with importing an increasing quantity of ever-more-expensive drugs. "The cost of treatment is going up and up and up," says Tanuri. More people on treatment also means more work for already-overstretched clinics. "Brazil has not done the homework over the past 10 years," complains Schechter, who would like to have seen the government use research to assess how best to use its limited resources. "I'm really concerned about the sustainability of the program."

Tripping on TRIPS
Between 1997 and 2004, the average annual cost of antiretroviral therapy in Brazil dropped from $6240 per patient to $1336. That decline allowed the country to treat more people without increasing its budget for AIDS drugs. But because Brazil has steadily purchased more imported drugs, in 2005 the per-patient annual cost jumped to $2500 (see graph, p. 485). Forecasts suggest that costs will continue to climb unless the country violates patents or negotiates better deals with Big Pharma.

At the crux of Brazil's current dilemma are the World Trade Organization's patent rules, known as the Trade-Related Aspects of Intellectual Property Rights (TRIPS). In 1996, when Brazil decided to offer HIV cocktails, it passed a law that enforced the TRIPS agreement. The new regulation meant that Brazil could legally produce anti-HIV drugs patented before the signing--but not the improved antiretroviral drugs and new classes of drugs that have come to market over the past 10 years. Today, Brazil's Ministry of Health spends 80% of its $445 million annual budget on imported antiretroviral drugs. And the ministry estimates that between 2006 and 2011, the annual cost of purchasing just three of these drugs--Merck's efavirenz, Abbott's lopinavir/ritonavir, and Gilead's tenofovir--will jump from $145 million to $248 million.

If the government instead made the drugs at the state-owned pharmaceutical company Farmanguinhos, the ministry says the country would save $769 million over that period. "If there's no change in the price of second-line drugs, no country like Brazil will be able to afford them," says Luiz Loures, a Brazilian epidemiologist who works at UNAIDS.

"Brazil has the technical capacity to produce all of the drugs," says Paolo Teixeira, who ran Brazil's AIDS program from 2000 to 2003 and now works as a consultant for São Paulo's AIDS program. And he says that gives the country a strong negotiating tool when purchasing antiretroviral drugs in bulk from Big Pharmas. Essentially, the government has said, "If we don't like your price, we'll violate the patent and make the drug ourselves." This is allowed under the TRIPS agreement, which says signatories can invoke what is known as a "compulsory license" to address public health emergencies. No country has yet done so, however, because of fear of damaging international trade relations. Brazilian President Luis Inácio Lula da Silva twice has promised to use the compulsory-license clause for anti-HIV drugs but has backpedaled both times, complains former AIDS program head Chequer. "They were cowards by not doing that," says activist Tavora. "That could be very useful to all of us, to the whole world."

David Greeley, Merck & Co.'s spokesperson for Latin America, says if Brazil invokes compulsory licensing, it will ultimately harm the people the government is trying to help. "We've tried to convey to our counterparts in Brazil that it's not in the long-term interest for Brazil to adopt this stance," says Greeley. As with other Big Pharmas, Merck invests in research and development of new products because intellectual-property regulations exist, he says. "Intellectual property is an incentive to innovation, not a barrier to access," he maintains.

Retaining the lead
In the Rio suburb of Jacarepaguá, there are clear signs that the government once again wants Brazil to lead the charge against Big Pharma with more than rhetoric. Jacarepaguá's Estrada dos Bandeirantes has long housed the gleaming offices of international giants such as Abbott and Roche, both of which have crossed swords with Brazil over pricing of their anti-HIV drugs. In August 2005, a new resident moved into the neighborhood: Farmanguinhos, the government-owned drugmaker.

Farmanguinhos's new factory, once owned by GlaxoSmithKline, has five times the production capacity of its old plant on the other side of the city. Company Director Eduardo de Azeredo Costa has ambitions beyond just manufacturing more antiretroviral drugs. He says Brazil needs to start producing the active pharmaceutical ingredients used to make the drugs, which it now purchases from India and China. Costa says these are often of inferior quality, so by making its own, Farmanguinhos can both reduce costs and avoid expensive delays in production.

Patently absurd. Not invoking compulsory licenses is deadly, says Pedro Chequer.

Costa agrees but says Farmanguinhos and other drugmakers must rise to the occasion, for the sake of Brazil and other cash-strapped countries. As Costa walks around the plant's new high-tech machines--several of which are still wrapped in plastic--he notes that representatives from two dozen countries have toured the facility in hope of following in the Brazilian government's footsteps. "People of the world want us to be much better than we are," says Costa. "We have to answer to this demand."