Life, Death, and Property Rights: The Pharmaceutical Industry Faces AIDS in Africa

www.hbsp.harvard.edu
Authors: Spar, Debora L.; Bartlett, Nicholas
Source: Harvard Business School Publishing
Year: 2005
Company Name: The Pharmaceuticals Industry
Number of pages: 24

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Abstract:

This case was analyzed for the 2003 Walter V. Shipley Business Leadership Case Competition. In the final years of the 20th century, the world was hit by a plague of epidemic proportions--AIDS, a life-threatening disease that remained stubbornly immune to any cure or vaccine. In the developed nations of the West, AIDS was slowly brought under control through a combination of education, prevention, and cutting-edge medicines. But in the developing world, where health care expenditures were often paltry, AIDS continued to rampage. By the year 2000, 25 million people in Africa alone were infected with the disease. Millions had already died. Nearly all of the medicines that treated AIDS had been developed--at great expense--by the major western pharmaceutical firms. These medicines were expensive to produce and often difficult to administer. They demanded levels of income and structures of distribution that often were sorely lacking in the developing world. Increasingly, activists groups were demanding that the pharmaceutical companies respond to the AIDS epidemic with drastic measures, giving their drugs away for free or abandoning the patent rights that had long protected their intellectual property. The pharmaceutical firms needed to respond to their critics. The question was, how? (Harvard Business School Publishing also provides a teaching note for this case.)