Moral luck : exploiting South Africa's policy environment to produce a sustainable national antiretroviral treatment programme

02 August 2007

What kinds of social policy interventions will enable South Africa to offer a universal, free and sustainable antretroviral treatment programme? Some commentators assert that government's best chance at offering such a programme will require the use of compulsory licenses and that the state's failure to make use of such a weapon is a failure to discharge its constitutional duties. The authors demur. The threat of a compulsory license is only as good as the ability to make use of such a license. South Africa currently lacks the basic science community, reverse engineering capacity and fine chemicals industry necessary to make good on such a threat. The government's best hope for discharging the duties imposed by the Constitution is a systematic, structural intervention: the implementation of a socio-industrial policy that leverages existing industrial capacity and voluntary licenses in a manner that generates price reductions and offers an uninterrupted sustainable local supply. However, voluntary licenses will only create downward pressure on prices when South Africa is able to establish a robust generics pharmaceutical industry. Such an industry can be created with appropriate tax relief, investment credits, technology transfer and assured access to active pharmaceutical ingredients. South Africa's industrial, legal and financial resources can thereby be profitably exploited in a manner that progressively achieves a comprehensive and coordinated antiretroviral treatment programme.