Letter to Bristol-Myers-Squibb, Re: Discount Deals for South Africa

Dear Charles A. Heimbold, Jr.
We are writing to follow up on Bristol-Myers Squibb’s announcement earlier this week of concessionary terms for the provision of d4T and ddI in Africa.
We support the issuance by patent holders of voluntary, royalty-free, non-exclusive licenses of essential life-saving medicines to all potential bona fide manufacturers and suppliers, for all non-OECD countries plus Mexico.
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March 16, 2001

Charles A. Heimbold, Jr.
Chief Executive Officer,
Bristol-Myers Squibb
345 Park Avenue
New York, NY 10154

Dear Charles A. Heimbold, Jr.

We are writing to follow up on Bristol-Myers Squibb’s announcement earlier this week of concessionary terms for the provision of d4T and ddI in Africa.

We support the issuance by patent holders of voluntary, royalty-free, non-exclusive licenses of essential life-saving medicines to all potential bona fide manufacturers and suppliers, for all non-OECD countries plus Mexico.

Your recent announcement seems to represent a near-first step to achieving this aim.

The BMS press release and statements attributed to BMS spokespeople suggest that you are willing to forgo enforcement of patent rights in South Africa, and that you do not claim intellectual property rights on these products anywhere else in sub-Saharan Africa. [Footnote: “The particular mechanism could be just non-enforcement of the patent by us,” he [John McGoldrick, BMS executive vice president] said. “It could be some kind of technical mechanism. . . . It doesn’t really matter to us. . . . Our key decision is: Take that patent off as any factor in availability of Zerit in South Africa.” (“Another Firm Cuts HIV Drug Prices,” by Karen DeYoung and Bill Brubaker, Washington Post, March 15, 2001); ” Bristol-Myers Squibb has made an agreement with Yale University to grant a free license under the patent for Zerit (rights to which are owned by Yale and Bristol-Myers Squibb) to treat AIDS in sub-Saharan Africa.” BMS News Release, March 14, 2001.] BMS seems to have been ambiguous as to whether this purported release on patent right claims extends to both ddI and d4T, or just to d4T.

If you are sincere in your claim to forego patent rights in sub-Saharan Africa, there is no conceivable reason for you to refuse to issue formal, voluntary, royalty-free, non-exclusive licenses for both ddI and d4T to all potential bona fide manufacturers and suppliers. Indeed, you should prefer such an approach to encouraging other manufacturers and suppliers to violate your intellectual property claims in Africa.

From our point of view, which is focused on achieving access to life-saving medicines, the issuance of a license is vital. First, companies may reasonably be reluctant to forge ahead with production in South Africa or export to South Africa on the basis of an informal and imprecise statement from Bristol-Myers Squibb. Indeed, many may reasonably take the position that they respect intellectual property claims, and will refuse to sell in a market without a formal license. Second, it is possible that companies may confront registration difficulties if they do not have a valid, formal license for a product patented by another.

To effectively enable others to produce and market the drugs, we ask that you also issue a similar license to the registration data (marketing approval information showing safety and efficacy) connected to the drugs. If protections on such data still exist, they could effectively bar introduction of generic competition for years.

It is also vital that BMS provide to the public the fullest knowledge it has on other intellectual property claims related to ddI and d4T, held by entities other than BMS, in South Africa and elsewhere in Africa. These entities will also need to issue licenses for generic makers and suppliers to produce and supply the drug for South Africa.

As you know from experience, there is little technical difficulty in issuing such licenses. We urge you in the strongest terms to issue such licenses today, on both ddI and d4T. Doing so will represent a genuine first step in the effort to deliver medicines needed to save the lives of the millions in the developing world now living with an HIV/AIDS death sentence hanging over their heads.

You must also extend the voluntary licenses to all non-OECD countries. For the vast majority in these countries with HIV/AIDS, lifesaving pharmaceuticals are out of reach. Their lives are no less important than those in Africa.

Issuance of voluntary licenses is not a cure-all, nor does it represent the full extent of what the pharmaceutical companies must do. Certainly, if BMS is acting in good faith, it must immediately withdraw from the lawsuit challenging South Africa’s Medicines Act. Attached, you will find a set of criteria that we believe should apply to all drug companies making life-saving medicines, including criteria for assessing concessionary offers and outlining the moral imperatives resting with the companies to enable poor countries to achieve sustainable access to life-saving medicines.

We look forward to your immediate response to these requests.

Sincerely,

Robert Weissman
Co-Director
Essential Action
P.O. Box 19405
Washington, D.C. 20036