GlaxoSmithKline makes major shift on drug prices in developing countries

Date: 16 Feb 2009

The new CEO of pharmaceutical giant GlaxoSmithKline, Andrew Witty, has said that the company will slash prices on all medicines in the poorest countries, give back profits to be spent on health care, and shake up the patent protection covering potential drugs that could be developed.

The announcement signifies a major break with the previously common position of the drug companies faced by demands they make essential drugs cheaper for the poorest communities across the world. Announcing the change in an interview with the Guardian, Witty said that he believes drug companies have an obligation to help the poor get treatment, and challenged others to follow GSK's lead.

In detail, Witty said that GSK would cut prices for all drugs in the 50 least developed countries to no more than a quarter of the prices in home markets such as the UK and US. Most radically, the company would put chemicals and processes where it owned the intellectual property rights into a 'patent pool' so they could be explored by other researchers looking for drugs to treat neglected diseases.

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