December 19, 2000
Mr G G Brereton Dear Sir,
CIPLA seeks to sell products for the treatment of HIV and related illnesses,
including those containing lamivudine and zidovudine. You have contacted CIPLA
in the past asserting intellectual property rights in such products in certain
countries. As you know, the high prices for HIV/AIDS medicines have made it
impossible for millions of persons in developing countries to obtain access to
medicines, contributing to widespread suffering and death. CIPLA seeks to
provide a competitive product, with the expectation that competition will drive
prices down, benefitting patients and saving lives. To this end, CIPLA requests
a timely response to the following items:
Depending upon the nature of Glaxowellcome's property rights in the each
country, CIPLA is willing to pay royalties as high as 5 percent of net sales,
for example, in countries where Glaxowellcome has patents similar to those
granted in the United States or the UK. (In countries where Glaxowellcome has
substantially lesser intellectual property claims, for example, in countries
where Glaxowellcome did not file for a "use" patent for AZT, CIPLA would
negotiate an appropriate royalty that reflects the value of the IPR in the
product.)
According to a February 2000 submission to the United States Trade
Representative (USTR) by the US trade group PhRMA, five percent is the
"approximate the average pharmaceutical royalty rate," and given the human
tragedy unfolding the developing countries over the lack of access to medicines
for HIV AIDS, the "average" royalty is surely adequate for the world's poor.
Given the urgency of the public health crisis, we ask for a response to this
request by January 25, 2000.
Yours sincerely, Amar Lulla
Head of Patents
Global Intellectual Property
Department
GlaxoWellcome
Glaxo Wellcome House
Berkeley Avenue,
Middlesex, UB6 ONN
United Kingdom
For Cipla Limited
Director