AIDS Healthcare Foundation (AHF), the largest non-government provider of health care services for US patients with HIV/AIDS, is expected to file suit against the US arm of GlaxoSmithKline alleging that several patents for its AIDS drugs are invalid, and that it has abused a monopoly in pricing those drugs. The lawsuit, expected to be filed in the US District Court for the Central Division of California, Western Division, alleges that Glaxo's prices for AIDS drugs such as Ziagen, Epivir, AZT and Retrovir "exorbitantly exceed its costs of licensing, manufacturing and distributing," and so "present a formidable obstacle for proper treatment of the AIDS epidemic in the [United States]," according to a draft copy of the lawsuit.
"We believe we have valid patents for our products," said a Glaxo spokesperson. Glaxo and other makers of AIDS drugs have cut prices by 90 percent or more to many poor nations. Now, AIDS activists are aggressively pursuing similar price cuts for the US market. Glaxo is one of the biggest manufacturers of AIDS medicines. Last year the British company said sales of its AIDS drugs rose 14 percent to $1.76 billion. Activists targeted Glaxo especially because the prices of some of its AIDS drugs in developing countries are twice the prices charged by rivals such as Merck and Bristol Myers-Squibb. Glaxo has said it makes no profit on those sales and that its prices reflect the cost of manufacturing.
AHF, which operates AIDS clinics and pharmacies that provide drugs to patients in the United States, Uganda and South Africa, said that it would seek triple damages of $66 million from Glaxo, based on AHF's drug purchases from Glaxo totaling $22 million over about four years. The group said its recent negotiations to persuade Glaxo to lower its prices in the United States faltered. Glaxo also declined to fund a program to provide free AIDS drugs in Uganda, South Africa and elsewhere, said AHF.
AHF claims that AZT, Epivir and Ziagen were developed with significant amounts of US government funding and, under US law, should be sold at more reasonable rates. Glaxo "didn't discover these drugs, and they are charging too much money for them," said Michael Weinstein, founder and president of the foundation.
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