Essential Medicines News

Andrew Jack, “GSK Varies Prices to Raise Sales,” The Financial Times, 16 March 2008.

GlaxoSmithKline (GSK) has begun a scheme of tiered pricing of its medicines in low- and middle-income countries. The policy is being tested in India, South Africa and Morocco, to ensure the greatest availability of their products, while still recovering R&D costs from those who are able to pay. The GSK test includes both ARVs and Avandia, a medicine for diabetes. GSK’s 2007 Report on Access to Medicines is available in their annual review on corporate responsibility. An excerpt:

We recognise that many middle-income countries need assistance. However, we believe a different approach is needed from the one we take in the world’s poorest countries.

Our offer to supply medicines at not-for-profit prices and vaccines at highly preferential prices in the world’s poorest countries is only sustainable if we can continue to make an adequate return on them in wealthier markets. Many middle-income countries are also growing commercial markets for GSK and represent an important source of future business for our industry. It is forecast that the growing wealth of Brazil, China, India, Indonesia, Mexico, Russia and Turkey means they could account for 20 per cent of the global pharmaceutical market by 2020. Our response in these markets must therefore balance our commercial objectives with our global commitment to work with governments and other stakeholders to support efforts to deliver our medicines and vaccines to as many people as possible who need them.