The cost of treating HIV with antiretrovirals has plummeted during the past decade. Prices for the six most common initial treatments – or first-line drugs – in low and middle-income countries fell by between one per cent and 36 per cent from 2008 to 2009 alone, according to the World Health Organisation.
The declines are down to a variety of factors, including the production of generics or cheap copies of expensive drugs, and favourable pricing policies by pharmaceutical firms. But if you look beyond the headline figures for first-line treatments in poorer countries, it becomes clear that HIV remains big business for big pharma. HIV antiretroviral sales across the seven major markets of the US, Japan, France, Germany, Spain, Italy and the UK totalled $11.8bn (£7.6bn) last year, according to figures from the research firm Datamonitor.
That represents compounded annual growth of 10 per cent between 2005 and 2009. The US was the biggest market, booking $7.7bn in antiretroviral sales last year. France was the largest of the European markets, with sales of $1.1bn, while Japan was the smallest overall. In terms of patients, the number of people living with HIV across the seven major markets went from 1.4 million in 2001 to 1.8 million in 2009, with further increases expected in the coming decade. The US is forecast to hold on to first place, with Datamonitor expecting it to account for 60 per cent of sales across the seven markets in 2019. Japan is forecast to remain the smallest.
The recent surge in growth was driven by the continued uptake of the Truvada drug, which is produced by California-based Gilead Sciences, and by Atripla, a combination of Truvada and Bristol-Myers Squibb's Sustiva treatment in a single pill. In 2009, Gilead notched up $2.5bn in Truvada sales; Atripla was just behind with $2.4bn in sales. In the US, Truvada boasts a market of share of 32 per cent of all prescriptions in its class of drugs. Atripla's share stands at 28 per cent.
More recently, the companies reported a rise in profits for the third quarter as sales of its core HIV drugs surpassed expectations. Sales of Truvada were up by 8 per cent to $668.7m, while Atripla sales soared by more than 20 per cent to $742.7m.
In the UK, GlaxoSmithKline (GSK) and the US group Pfizer joined forces in November last year to put their HIV business into a joint venture called ViiV Healthcare. With a portfolio of 10 available medicines, ViiV, which is 85 per cent-owned by GSK and 15 per cent by Pfizer, commands a 19 per cent share of the worldwide HIV drugs market. Its full-year figures will be published in February, but GSK's last annual report showed that sales of HIV medicines totalled £1.6bn last year.
Back in the US, Bristol Myers-Squibb's most recent results showed a 9 per cent rise in third-quarter sales for its Sustiva drug. The figures for rival group Merck are also impressive. Its lead HIV drug, Isentress, recorded worldwide sales of $278m in third quarter of 2010, an increase of 41 per cent on 2009.
Stephen Lewis, the former United Nations special envoy for HIV/Aids in Africa and current co-director of Aids-Free World, an international advocacy organisation, says the strength of the HIV drug firms shows that while treatment prices for low-income countries have gone down, companies have sought to offset the declines by continuing to market drugs at high prices in richer markets – a part of the HIV/Aids story that is often overlooked.
Moreover, he said, prices in low-income countries came down primarily because of the growth of "generics producers in places like India, not because of some sudden humanitarian spasm" on the part of the pharmaceutical companies.
Geoff Porges, an analyst at Sanford C Bernstein, is more charitable in his assessment, saying that the pharmaceutical and biotechnology industry had "done a very poor job" in communicating the advances made in the treating life-threatening illnesses such as HIV.
"We've turned it [HIV/Aids] from an inevitable, terrifying death sentence to a chronic illness that can be managed in the context of a life expectancy that is pretty close to normal," he said.
Mr Porges said the advances were down to some risky investments by the drug companies, which have gone on to prove "very successful and very profitable and they have been rewarded handsomely". In the medium term, the industry as a whole is set to see further growth in HIV drugs. Datamonitor expects sales across the seven major markets to expand at a compounded annual rate of 5.7 per cent in the three years to 2013. But the picture will change soon after as major patents run out. The Sustiva patent, for example, expires in 2013.
Taken together with a relatively empty pipeline of drugs, these pressures are expected to slow the growth in HIV antiretroviral sales from 2013 onwards.
In time, Datamonitor forecasts a decline in sales after 2015, with the compounded annual growth rate relaxing to -1.7 per cent between then and 2019. "Companies in the HIV market are running up against the same challenges as the industry is facing in every other category," Mr Porges said.
Given the limited options for long-term growth, activists have been highlighting the ongoing EU-India free-trade negotiations. India is a major producer of affordable generic drugs, with 80 per cent of all donor-funded Aids medicines coming from Indian generic producers.
But the EU has been accused of pushing for the application of measures such as "data exclusivity", which could hamper the generics industry. Currently, generics producers have to show only that their copies are equivalent to the original drugs.
Regulators in turn rely upon the safety data generated by the original manufacturer. Data exclusivity, however, would allow the original manufacturer to stop the generics producer from referring to its data for up to 10 years.
Médecins Sans Frontières says the provision would lead to the creation of a "new patent-like" monopoly, favouring drug companies, but hampering the supply of cheap drugs.
And now the good news... Why lip service might be the key to raising more money
The M·A·C Aids Fund (MAF), supports HIV-affected individuals all around the world.
MAF is committed to addressing the link between poverty and HIV/Aids by supporting a diverse range of organisations that provide services to people living with HIV/Aids.
To date, MAF has raised more than $190m (£122m) through the sale of M·A·C's Viva Glam lipstick and lipgloss, donating 100 per cent of the sale proceeds from each product to the battle against HIV/Aids. A single lipstick sale pays, for example, for two hours of childcare for a woman attending a doctor's appointment, 233 condoms, or two emergency boxes full of non-perishable food.
MAF's work spans both developed and developing nations, with a particular focus on combating homophobia. This year alone MAF has given more than $250,000 in grants to South African youth projects, and also funded advocacy work in the Caribbean.