When Yusuf Hamied defied Big Pharma in the battle against HIV/AIDS

The subject of the closed-door meeting attended by health ministers and heads of government from various countries along with chief executives of major pharma MNCs, was access to medicine in the developing world, especially for the dreaded human immunodeficiency virus (HIV) and its most advanced stage of infection, acquired immunodeficiency syndrome (AIDS). Seated amidst the heavyweights of global pharma like Merck and Glaxo was an oddity, an Indian generics company, Cipla. Its presence was a major surprise since generic makers were looked upon as pariahs by Big Pharma. But what really caused a stir was when the company’s boss, Yusuf Hamied, stunned the assembled audience with his offer to supply an anti-AIDS cocktail drug for $800.

At that point, the normal cost of the AIDS cocktail in the West was $10,000 to $15,000 a year.

Not surprisingly, Hamied’s words were received with a deafening silence and there seemed to be no immediate takers for the generous offer.

But within months, there was a breakthrough. In February 2001, Cipla offered Nobel Peace Prize-winning Médecins sans Frontières (Doctors Without Borders), a supply of triple-therapy drug ”cocktails” comprising stavudine, lamivudine and nevirapine, for $350 a year. The patents for these were held by Bristol-Myers Squibb, Glaxo-Wellcome and Boerhinger Ingelheim, respectively, but they kept the prices out of reach for most patients. Profit was the key to Big Pharma’s existence. Cipla, by contrast, was prepared to lose money because as Hamied said on the occasion: “We all have a responsibility to alleviate the suffering of millions of our fellow men who are afflicted with HIV and AIDS.”

It was a pivotal moment in the history of mankind. The AIDS virus was wreaking havoc across the world. Worst hit were poorer countries in Africa where the infection rate had reached as high as 36% in some places.

But that wasn’t even the full scale of the unfolding tragedy. By 1999, drugs were available to reduce the pain and extend lives of Aids victims. Sadly, given the exorbitant prices, only a few thousands among the millions suffering from the disease could afford the treatment. This meant that thousands of untreated people were dying every day, even as life-saving drugs were available.

It had always been like that. Big drug companies protected their patents and refused to allow cheaper versions of even lifesaving drugs to be made. The situation had led to the passing of The Drug Price Competition and Patent Term Restoration Act of 1984 in the US. Called the Hatch-Waxman Amendments, its objective was to reduce prices of off-patent drugs in the US by facilitating regulatory approval of low-cost, high-quality generic prescription drugs.

Catalyst for change

Cipla, Ranbaxy and a clutch of other Indian firms had seized upon the opportunity thrown open by the Act to supply cheaper generics to American drug stores. Tapping chemistry skills abundantly available in the country, Indian pharma companies had become experts at reverse engineering off-patent drugs. 

In the past, Cipla had produced a less than a dollar anti-malaria drug, while Lupin had launched low-cost medication for tuberculosis. So when Hamied threw down the gauntlet in Brussels, he was speaking with some authority. Cipla and the man who had inherited it from his father in 1972 were no pushovers. Khwaja Abdul Hamied had set up Chemical Industrial and Pharmaceutical Laboratories (Cipla), in 1935 in response to a call from Mahatma Gandhi. His son, Yusuf Hamied, a PhD in Chemistry from Cambridge, knew a thing or two about chemical drugs.

Despite that, the pharma barons of the world called him a “pirate” and a “thief” and cast aspersions on the quality of Indian generic drugs. For once though, they had to eat humble pie.

Hamied’s offer of February 2001 would galvanize a worldwide move against the refusal of pharma majors to cut their prices for the biggest threat to mankind. Soon, even the big drug companies were forced to lower their prices to more acceptable levels.

Cipla wasn’t the biggest beneficiary of the boom in sales of AIDS drugs, but the company had the satisfaction of knowing that its actions had led to millions of lives being saved.

To the millions who benefitted from the price crash that Cipla had engineered, Yusuf Hamied was the “Robin Hood of pharma”.