GlaxoSmithKline is to slash drug prices in the world’s poorest countries and reinvest profits made in less developed countries into hospitals and clinics, according to company chief executive Andrew Witty.

“Today we are setting out a new promise: we will reduce our prices for patented medicines in the LDCs so that they will be no higher than 25% of the developed world assuming we can cover our cost of goods,” he said at a Harvard Medical School talk (pdf).

As well as reducing prices in countries such as Zambia and Mozambique, GSK plans to establish a ‘patent pool’ to share research findings on tropical diseases. The patent pool could allow others to develop new products based on GSK’s compounds or process, with any benefits going “in full and solely” to the least developed countries (PharmaTimes). Other companies are being urged to join in the plans.

“Society expects us to do more in addressing these issues,” said Witty (Times). “To be frank, I agree. We have the capacity to do more and we can do more. The question is can we, big pharma, rise to the challenge and be a genuine catalyst for change?”

According to the Guardian, which broke the story on Saturday, GSK will:

Cut its prices for all drugs in the 50 least developed countries to no more than 25% of the levels in the UK and US – and less if possible – and make drugs more affordable in middle-income countries such as Brazil and India.

Put any chemicals or processes over which it has intellectual property rights that are relevant to finding drugs for neglected diseases into a “patent pool”, so they can be explored by other researchers.

Reinvest 20% of any profits it makes in the least developed countries in hospitals, clinics and staff.

Witty’s move has been cautiously well received. “This is a gutsy move in a commercial world. Witty has demonstrated a willingness to make saving lives a business goal along with making money,” says Mike French, director of advocacy at the World Vision charity (BBC).

Image: Witty / GSK