From EU Trade News, 26 May 2003
Today the Council adopted a regulation enabling exporters to deliver essential medicines at strongly reduced (’tiered’) prices to poor countries by making sure the goods are not diverted back to the European Union.
The regulation aims to enable producers to significantly increase supplies of medicines to combat HIV/AIDS, malaria and tuberculosis at lower, so-called ’tiered’ prices, while keeping higher prices for the same items in the EU. Exporters are invited to put their products on a tiered-price list run by the European Commission. Both patented and generic products can be registered. In order to be added to the list, medicines have to be made available either with a price cut of 75% off the average ’ex factory ’ price in OECD countries, or at the cost of production plus 15%. The proposed system is simple and transparent.
EU Trade Commissioner Pascal Lamy welcomed the decision: ’This regulation is an important contribution to a global partnership ensuring cheap yet sustainable supply of key medicines to the populations of poor countries. Industry sells the medicines at prices only slightly above their own production costs, whereas public and private donors provide the necessary funding for research & development. The EU provides the necessary legal framework, in order to ensure that the medicines are not diverted back into EU markets. We are thus setting an example with a practical means of helping poorer countries struggling with public health crises.’
Related questions and answers and the list of targeted countries
