AIDS drug lawsuit postponed, corporations continue mediation

PRETORIA, South Africa - Pharmaceutical giants entered settlement talks with the government yesterday, a sign they are dropping their fight against a law that could provide cheap copies of AIDS drugs to millions of South Africans.

The suit, postponed until today as the discussions continued, has deeply embarrassed the drug companies since it began six weeks ago. Many have responded by drastically cutting prices on their own.

However, human rights groups say those prices would fall even further in the face of generic competition.

An official with one of the pharmaceutical companies said the suit "had largely been resolved" after the South African government reached an agreement with several of the largest companies involved.

Those companies spent much of the day convincing the remainder of the 39 companies involved in the suit to accept the agreement, said the official, who spoke on condition of anonymity.

Only technical issues, including who will pay court costs, remained to be worked out, the official said.

International human rights groups and AIDS activists have waged a global public relations offensive against the suit, which they see as an obstacle to securing medication for the nearly 26 million people in Africa infected with HIV.

The law could give South Africa the power to import or produce generic versions of patented drugs - including expensive antiretroviral drugs needed to treat AIDS. An estimated 4.7 million South Africans are infected with HIV.