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The Thai Flu
Wall Street Journal, 3-14-07

The Journal discusses Abbott's announcement that is will not market any new drugs in Thailand in response to the government's compulsory license of Abbott's AIDS medicine Kaletra.

In the latest news, the Journal reports that Abbott Laboratories has decided not to market any new medicines in Thailand. Abbott will continue to sell drugs currently on sale in the country, but it has withdrawn its applications for other drugs under government review.

This is a big decision for any company, because it means forfeiting a large market and risking some negative publicity. But it is also an entirely rational business decision, after Thailand's military government decided to revoke Abbott's patent for its new blockbuster AIDS drug. In January, Thailand's Ministry of Public Health announced it would issue "compulsory licenses" for medications produced by Abbott and Sanofi–Aventis—meaning that Thailand will eventually produce generic copies of these drugs. This followed a similar move against Merck in November.

Thai patients will be the losers, at least in the short term, though that is entirely the fault of the Thai government. In the long run, Abbott's withdrawal may have a salutary impact if it demonstrates to Thai officials and other governments that they will pay a price for stealing intellectual property. Drug patents are a globally recognized way to guarantee a return on investment in producing new therapies, and there will be no incentive to innovate if governments can revoke patents with impunity.

Project FDA.
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