Roche Holdings' third-world discount: benevolence or bottom-line?


Leave it to a skeptic like me to find something wrong with something that seems ao benevolent. Today, Swiss drug maker Roche Holdings AG (RHHVF) said it will cut the price of its viral drug Tamilflu for developing economies to what would amount to less than half the price it normally charges, and let those countries spread their payments over several years. Sounds perfect, no? So what's my beef?

Well, Tamiflu -- and GlaxoSmithKline (GSK)'s competing drug Relenza -- have been already stockpiled by developed countries during the recent bird flu outbreak, so Roche now must sell the drug to those countries that haven't yet stockpiled it. "Tamiflu sells for as much as $100 per five-day treatment course in countries such as the U.S.," the AP reports, "but since 2005 the company has offered a discounted price of $16 per treatment to poor nations. Roche has also given approval for two companies - one in China and one in India - to produce Tamiflu generically."

Originally published