June 13, 2003

The Honorable David Walker
Comptroller General of the United States
441 G Street, NW
Washington, DC 20548

Dear Mr. Comptroller General:

We are writing to request the assistance of GAO to analyze the cost of manufacturing drugs to treat persons with HIV/AIDS, and the price paid for those drugs by US government agencies for use in the developing world.

On May 27, the President signed into law H.R.1298, which authorizes the appropriation of $15 billion for FY 2004 through FY 2008 for the global HIV/AIDS fight, including to purchase drugs to treat persons with HIV/AIDS in developing countries. We feel strongly that these funds should be used to purchase products of assured quality at the lowest reasonable price, so that taxpayers will receive the greatest value for this urgently needed investment to stop the HIV/AIDS epidemic.

President Bush has also expressed an interest in purchasing drugs to treat persons with HIV/AIDS at an economical cost. To ensure efficient use of taxpayer resources, we wish to obtain accurate information about the cost of manufacturing these drugs and the prices that will be paid for them in resource-poor countries. We request, therefore, that GAO study and issue a report as expeditiously as possible to:

• Detail the actual costs to manufacture the anti-retroviral and anti-viral drugs used to treat HIV/AIDS, as well as drugs to treat the opportunistic infections associated with HIV/AIDS, both for brand pharmaceutical companies and for generic manufacturers, including those manufacturers in India and Brazil and elsewhere. Such drugs include Nevirapine, Didanozine, Zalcitbine, Stavudine, Lamivudine, Abacavir, Saquinavir, Ritonavir, Nelfinavir, Amprenavir, acyclovir, Gancyclovir and combinations of these and other drugs used to treat opportunistic infections, such as pentamidine, azithromycin and ciprofloxacin;

• Detail components or the costs of manufacturing these drugs, such as the cost of the raw ingredients, the cost of manufacturing and packaging the products, and other costs;

• Identify the factors, such as limited supplies of raw materials or active ingredients, limited manufacturing capacity, and/or the costs associated with increasing manufacturing capacity, that may affect the cost to manufacture these products;

• Identify the lowest price for drugs that are approved by the Food and Drug Administration, authorized for marketing by the European Commission, or included in the most recent edition of the list of HIV-related medicines pre-qualified for procurement by the World Health Organization's Pilot Procurement Quality and Sourcing Project;

• Identify the various prices at which these drugs have actually been procured in the past year, and the lowest reasonable prices at which they could be procured using funds under the United States Leadership Against HIV/AIDS, Tuberculosis and Malaria Act of 2003; and

• Identify procurement methods, existing and proposed, such as bulk procurement, that would reduce costs to the U.S. government.

Thank you very much for considering this request. We would be pleased to discuss it with you in greater detail, and we look forward to your report.

With best wishes, I am

Tom Daschle

John McCain

Edward M. Kennedy