South Africa: Drug Giants May be Ready to Drop Case and Settle

18 April 2001

Johannesburg — It was meant to be a landmark court case about expensive patented drugs versus cheaper generic alternatives. But the case in the High Court in Pretoria, brought by 39 of the world's leading multinational pharmaceutical companies against the South African government, swiftly turned into a clash about life and death. Today it looked like demonstrations and potential deals. The hearing first opened in March, was adjourned to Wednesday 18 April and, after a morning court session, was adjourned again till 10h00 on Thursday.

The drug giants have challenged a law, passed in South Africa in 1997, that would give the Pretoria government blanket powers to manufacture, license and import affordable versions of their brand-name medicines, thereby violating their patents. These cheap drugs could be used to treat AIDS and other illnesses.

The many groups opposed to the case brought by the drug manufacturers have been vocal. They accuse the companies of putting profits before human lives in poor countries where people are suffering from life-threatening diseases, such as HIV/AIDS, with no access to appropriate medication. Activists and civilians in South Africa are appalled and angry that there should be any argument about access to cut-price, often life-saving drugs for the developing world.

Pressure on the pharmaceutical companies to drop their case has been constant, rising to a crescendo in the past week with protest demonstrations and petitions. On Wednesday, as they returned to the Pretoria High Court after a six week adjournment, sources indicated that some drug groups were ready to drop the case and negotiate a settlement with the South African government.

The companies are backed by the Pharmaceutical Manufacturers' Association of South Africa(PMA), but it appears that their camp is split, with some opting for a settlement, while others are determined to stand firm.

The London Financial Times newspaper reported, without quoting sources, that Bristol Myers-Squibb, Merck, GlaxoSmithKline, Roche and Boehringer Ingelheim - five of the biggest drug companies - were prepared to pull back in return for a promise from the Pretoria government that it would redraft the legislation in line with international law. The paper said the five were trying to convince the other thirty-four companies to withdraw from the case and negotiate a settlement.

Lawyers for the drug multinationals requested the earlier adjournment Wednesday so that they could continue discussions that might "shorten the need for further proceedings". Many took that to mean they might be preparing to negotiate and may even be prepared to abandon the case. Speculation is rife, fuelled by a declaration from a South African government spokesperson, that a settlement was imminent.

The protesters have seized the moral high ground in this case and have stuck to it, using inventive ways to make their point against the drug giants. In front of the Pretoria High Court, activists from non-governmental organisations, staged their own mock trial on Wednesday, before the real hearing was adjourned until 14h00 local time (12h00 GMT) and then held over until Thursday morning.

In the parallel trial, a bewigged woman 'judge' told the 'accused' - masked activists portraying five of the world's leading pharmaceutical executives - "You stand accused of the heinous crime…of grievous bodily harm to the people of South Africa and, further, of putting corporate profit before life". The manacled executives were found guilty of endangering the lives of South Africans "through their greed" and an appreciative audience registered its satisfaction.

Demonstrators gathered outside the court house and held up two banners displaying 250,000 signatures, roughly the number of people reported to have died from AIDS in South Africa last year. Other protestors performed a warlike 'toyi toyi' dance.

As they waited for the judge to return to the court house in the afternoon, spectators sang the melodious national anthem of South Africa and raised their fists symbolically as they did during the struggle for liberation in South Africa.

For Zackie Achmat, an AIDS' campaigner, who heads the Treatment Action Campaign, (TAC), the battle continues, though he was hopeful that the drug companies would drop their case. Wearing his trademark yellow t-shirt with the words "I'm HIV positive" emblazoned on the front, Achmat told an impromptu news briefing, "We are happy, but cautious. It is clear the Pharmaceutical Manufacturers' Association is crumbling and we are confident the drug companies will drop the case".

Achmat added a note of caution, which was echoed by his colleague Ellen t'Hoen from Medecins sans Frontieres (MSF). "If the companies drop the case, we need to know whether they are saving face or whether (the South African government) is negotiating away rights," she said. "We hope the latter is not the case".

The optimism that the case may be dropped and a settlement agreed, that will allow affordable medicines in South Africa without delay, is tinged with some regret among AIDS' activists that the Pretoria government itself - which is being taken to court by the drug manufacturers - has so far refused antiretroviral medication for pregnant women and others living with AIDS in South Africa. Almost five million people in South Africa are infected with HIV/AIDS.

The drug companies have pointed out that the South African government has recently ignored offers of free or much reduced prices for AIDS' drugs. They also maintain that the 1997 South African law would put the future of the pharmaceutical industry, and its scientific research to pioneer new drugs, in jeopardy because it would threaten revenue. The multinationals are reported to make less than one percent of their profits in Africa.

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