AIDS: Who Pays?

Western leaders are recognizing now that with no cure or early vaccine in sight, the scourge is a threat to the global economy, to development, and to security. They acknowledge, too, that the governments and people of developing countries simply do not have the money it takes to control the infection. Armed forces are particularly vulnerable, with two out of every three South African soldiers infected - a sorry army to take to war.

Last week's 13th International AIDS Conference - the first in a developing country - made it clear that in the West, expensive drugs have brought HIV infections down to the level of a chronic but manageable disease, with most sufferers leading long and useful lives and showing no outward symptoms.

In developing countries, particularly in black Africa south of the Sahara, the epidemic is a killer just because the drugs are unaffordable.

Conservative figures calculated by the UN agency UNAIDS are mind-numbing: in sub-Saharan Africa, it says, 24.5 million people are infected - more than 70% of the world total; infection rates are up to one in three adults; in South Africa alone, 5,000 HIV-positive babies are born each month - a figure that could be drastically reduced with treatments of mother and infant that would cost just four to eight dollars - and 2,400 South African babies die of HIV complications each month.

Asian economies will face "catastrophe of an unimaginable scale" if AIDS increases there to the scale of southern Africa, the World Bank warned. "We are equally concerned about the growing epidemics in Asia and eastern Europe, as well as in Latin America - especially the Caribbean," said Debrework Zewdie in a paper presented on behalf of Bank president James Wolfensohn. "... Given the large population of Asia, that (Africa-style levels) would represent catastrophe of an unimaginable scale," he said.

International institutions, philanthropists and the governments of rich countries are offering grants and cheap loans - $500 million here, $100 million there, $50 million there - but these are spread over years and are peanuts in view of the scale of the epidemic, analysts say.

The British-based think-tank Panos pointed out that in Zambia alone, where one in five adults is infected, providing life-saving anti-retroviral drugs at current prices would cost two billion dollars in the first year, rising to $2.7 billion dollars in the third year - 76% of current gross national product. Worldwide, it said, it would cost $60 billion dollars to pay for the drugs - "a lot of money, but less than a quarter of the United States' annual military budget."

Small-scale initiatives could help, analysts say, such as a group of people in a developing country "adopting" a village and channeling relatively modest sums of money to it through a charitable organization.

Delegates and activists at the conference demanded that the big pharmaceutical companies lower their prices drastically in the developing world, and UNAIDS is negotiating big discounts with five of them.

Companies are offering to donate at least two drugs, but under conditions which the South African government for one, finds unacceptable. India, Thailand and Brazil are meanwhile producing generic copies of the drugs, selling them locally for up to 25 times less than the branded ones, and offering to sell them - and the technology to produce them - to other developing countries.

That provides patent complications in countries which have signed the relevant conventions, but U.S. President Bill Clinton has thrown his weight behind a World Trade Organization ruling that countries may use them if they declare a national emergency.

The pharmaceutical companies, meanwhile, might end up making more money if they slashed profit margins in developing countries. Their sales to Africa make up just 1.3% of their annual $400 billion turnover.