Millions of lives could be saved and much human suffering prevented if we could make available comparatively common drugs and devote more research and development to the four most common infectious diseases to which the abjectly poor people in the world are prone. No one would disagree with this proposition, including those who work in the pharmaceutical industry.

This report challenges the pharmaceutical industry to adopt policies in five areas that impact on developing countries: pricing, patents, joint public-private initiatives (JPPI), R and D and the appropriate use of medicines (drug safety).

The diseases which kill most people in developing countries are infectious diseases from which most people in the west do not die because drugs are available to treat them. At the top of the list are pneumonia, measles, diarrhoea, Hepatitis B and polio which kill 14 million each year. Most developing countries are so poor that the drugs to treat these diseases, which are not expensive, are unaffordable and often simply not available. Clinics and trained staff to administer the necessary injections and tablets are absent. The authors of the report do acknowledge that the pharmaceutical industry is not responsible for building the health systems of developing countries but say it "can play a key role in improving the health of millions of people in poor countries". There is no doubt that the industry could adopt a more active role in tackling the health crisis in the developing world and it should be given every encouragement to do so.

However I am not certain that the hectoring tone of this report will do much to persuade it. The problems facing the industry in making its contribution are insufficiently recognised in the report and its concern for the dilution of the protection of its patents is too lightly cast aside.

These companies invest very heavily in R and D and take a huge risk in doing so. They rely on their patents, which last 16 years at most, to protect their investment which includes preparing the drug for certification by painstaking and expensive clinical trials to satisfy the drug agencies of many countries. They must recover their R and D costs and return a handsome profit - all within the 16 year patent and before their product can be reproduced by other drug companies in Brazil and India. The profitability of pharmaceutical companies and the willingness of shareholders to invest in them are dependent on their successfully accomplishing this objective in the short time available. It also explains the very high price of new drugs.

The report points out that "less than 10 per cent of world pharmaceutical sales are to developing countries and only one per cent of anticipated 2002 sales are to Africa", the implication being that it would not harm the industry's profitability if it was to lower prices and make concessions to developing countries on its intellectual property rights, i.e. its patents. This is an argument which it is very difficult for the industry to accept because of the risk of contagion. Both Brazil and India have large pharmaceutical industries producing generic drugs which are a very real threat to the research based pharmaceutical industry. These considerations also explain why 90 per cent of research is not directed to infectious diseases in developing countries where they could not expect to recover their costs.

The report, therefore, cunningly plays upon the corporate social responsibility of the industry to encourage it to adopt "a global tiered pricing structure" which would deliver drugs at reduced prices in developing countries. It would be managed by an international public health body, such as the WHO. I cannot believe that this industry could expect much sympathy from a body dedicated to the worthy aim of improving world health. Likewise I find it difficult to believe that the companies will refrain from enforcing patents in developing countries. The call for greater transparency in JPPI is laudable but hardly attractive in a competitive world.

However the authors have a very potent emotional argument which the industry ignores at its peril. The withdrawal of their case in South Africa to enforce their patent rights and monitor prices for HIV/Aids retroviral drugs illustrates the forces ranged against them. There is a compelling case for the industry to help the developing countries, not just with the pricing of drugs but with delivery to those who need them most - the poorest of the world.

Until the companies develop policies, in each of the countries in the developing world in which they sell, which clearly demonstrate their contribution to beginning to solve the local health problems, they will rightly be very vulnerable to attack and this will affect their share prices.This report cogently marshals the arguments for the pharmaceutical companies to protect themselves even if its specific solutions and tone are not likely to appeal to the management and shareholders of most of them.