J&J Generics Deal May Speed AIDS Drug Access to Patients in Africa, India

Johnson & Johnson struck the first deal to license an experimental AIDS drug before regulatory approval, reigniting debate over how much companies should do to speed access to HIV treatments in poor countries.

J&J’s Tibotec Pharmaceuticals unit has agreed to let three generic drugmakers provide copies of TMC278 in sub-Saharan Africa, India and parts of Asia if it’s approved by regulators, the company said yesterday in a statement. If past AIDS drugs are a guide, that could make the pill available for a hundredth of the price that customers pay in the United States, said Mitchell Warren, executive director of the New York-based AIDS Vaccine Advocacy Coalition.

AIDS killed about 1.8 million people globally in 2009, the Joint United Nations Programme on HIV/AIDS said in a November report, making HIV the world’s deadliest infection. Yesterday’s announcement by New Brunswick, New Jersey-based J&J, the world’s largest maker of health-care products, may prompt similar deals by rival drugmakers, Warren said in a telephone interview.

“It is important and significant news,” he said. “This could indeed facilitate these products making it into the developing world at lower prices than could be offered just by the developers of the drugs themselves.”

Warren said Truvada, the AIDS drug made by Foster City, California-based Gilead Sciences Inc., sells for $35 to $40 a pill in the United States while generic versions may cost 40 cents in Africa, offering a guide for the potential savings.

Mylan, Aspen Licenses

Tibotec will license the drug to an Indian subsidiary of Mylan Inc., based in Canonsburg, Pennsylvania; Hetero Drugs Ltd. of Hyderabad, India; and Aspen Pharmacare Holdings Ltd. of Johannesburg, South Africa, J&J said in its statement.

J&J appears to be the first AIDS drugmaker to license generic copies of its drug before approval, said James Love, director of Knowledge Ecology International, a Washington-based nonprofit that seeks to expand access to medicines in developing countries.

The deal may have a downside if it means J&J is rejecting calls for drugmakers to license patents to The Medicines Patent Pool, a United Nations-sponsored effort to encourage access and research into lower-cost treatments, Love said by telephone.

While Tibotec’s move will help, the company may be able to expand access further, said Kaitlin Mara, a spokeswoman for the Geneva-based Patent Pool. The group is awaiting a response from J&J to a request last year that it grant licenses to the pool, Mara said.

‘More Ambition’

“While we very much welcome an increase in voluntary licensing, there should be more ambition as far as the number of developing countries and generic companies included,” she said.

J&J licensed the drug for use in 48 United Nations- designated “least developed countries,” as well as India and South Africa. The list excludes North Africa, Latin America outside of Haiti and Asian countries including Pakistan, the Philippines and Indonesia, Love said.

The agreements “are the first part of a comprehensive access strategy for TMC278,” Karen Manson, a Tibotec spokeswoman, said today in an e-mail. “We have taken this proactive approach well in advance of any regulatory approvals for TMC278. These agreements include those countries that have the highest HIV burden and those with the greatest economic vulnerability.”

The company is still seeking approval for its drug from U.S. and European regulators and doesn’t know how much generic sales of TMC278 may save, Manson said.

Technology Transfer

“The generic companies have to have some time in which they’re working on their formulations for the drug and we’re transferring technology and information to them,” she said. “The idea is all together we get TMC278 to the market in these countries as soon as is possible.”

The generic companies will pay Tibotec royalties of 2 percent to 5 percent of what they are paid for the pills, according to yesterday’s statement. Tibotec expects to do no more than break even on the arrangement, Manson said.

Gilead said Jan. 25 that the U.S. Food and Drug Administration had refused to accept an application for a pill combining Gilead’s Truvada and TMC278. The move resulted from impurities in the drug related to Truvada, Gilead said in a statement. The concerns didn’t involve TMC278, Manson said today.

To contact the reporter on this story: Alex Nussbaum in New York anussbaum1@bloomberg.net.

To contact the editor responsible for this story: Reg Gale at Rgale5@bloomberg.net

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