Brazil recently issued a compulsory licence that will allow the manufacture of generic versions of a drug, which is used to treat hiv/aids patients. The drug, Sustiva (efavirenz), is marketed as Stocrin by Merck and Co in developing nations. The licence will allow generic versions in spite of Merck's patent for the drug until 2012.

Brazil's president Luiz Inacio Lula da Silva announced the licence, a day after the government rejected Merck's offer to sell the drug at us $1.10, a 30 per cent discount, from its earlier price of us $1.57. The government had asked Merck to lower the price to us $0.65 per pill. Brazil will now save an estimated us $30 million in 2007 and about us $237 million by 2012 by using the generic.

us-based aids Healthcare Foundation has called Brazil's achievement a victory. But the step also generated criticism. The us Chamber and us-Brazil Business Council called it a "major step backward' in intellectual property law.