Monthly PrEP pill could be made for US$3 a year, but Latin America is shut out of generic licensing

Merck's investigational once-monthly PrEP pill could be manufactured and sold profitably for around $3 per person per year, making it the cheapest HIV prevention drug ever brought to market, the 26th International AIDS Conference (AIDS 2026) in Rio de Janeiro heard yesterday. But the licensing deal announced by the company days earlier leaves out most of Latin America, including countries hosting the drug's own phase III trials.

MK-8527, now known as alimatravir, belongs to a new class of drugs called nucleoside reverse transcriptase translocation inhibitors. It is taken as a single tablet once a month at a dose of 11mg, compared to 500mg a day for oral tenofovir disoproxil fumarate/emtricitabine (TDF/FTC).

Costing method

To arrive at the $3 estimate, Dr Samuel Cross of Christchurch Hospital, New Zealand and colleagues searched the Trade Vision LLC database from January 2020 to December 2025 for shipments of the active pharmaceutical ingredient (API) in alimatravir – the raw material needed to produce it. Four shipments were recorded, of which two were over 1kg from Merck to Laurus Labs in India, of 1.5kg and 3kg, sent in December 2025. The weighted mean price across those shipments was US$9,138 per kilogram.

At a dose of 11mg per month (132mg per year), that puts the raw ingredient cost at $1.21 per person per year. Adding formulation, packaging, excipients, a 5% allowance for API lost in manufacturing, and 21% for transport, tariffs and labour brought the figure to $1.80. With a 30% profit margin and 27% taxation, the standard rates for Indian generic suppliers, the final estimate was $2.49 a year, which the researchers rounded up to $3.

For comparison, generic oral TDF/FTC costs around $40 per year, the dapivirine vaginal ring $71, injectable cabotegravir $160 and generic lenacapavir around $40.

“PrEP needs to be given to tens of millions of people to have a significant effect on the HIV epidemic,” said Cross. “Currently, around 2.3 million people are taking PrEP worldwide, and this is having little to no effect on the epidemic, especially in low- and middle-income countries. PrEP needs to be available at a very low cost for mass treatment to be affordable.”

The $9,138 per kilogram figure reflects the small volumes being produced while the drug is still in trials, Cross said, and has the potential to fall by around 90% once manufacturing scales up. Structurally similar antiretrovirals already sell at $391 per kilogram for darunavir and $532 for atazanavir.

This costing method, Cross explained, has correctly predicted production costs for a number of HIV, hepatitis B and C, TB and cancer drugs over the past decade. Sofosbuvir launched at $84,000 and was predicted to cost $210 to make; the generic now sells at $60. Most relevant here, lenacapavir launched at $28,000, was predicted to cost $40, and two generic companies plan to sell it at $40.

Efficacy unknown

However, efficacy remains unknown. Following favourable phase II safety and tolerability results reported in 2025, alimatravir is now being evaluated in phase III clinical trials involving almost 9,000 participants across 17 countries in Latin America, Asia, Europe and Africa. The studies compare 11mg monthly alimatravir with daily TDF/FTC, with results expected in late 2027.

Cross cautioned that participants in these trials take tablets unsupervised, unlike the PURPOSE trials of lenacapavir where every injection was medically administered and adherence was close to 100%. It’s therefore realistic to expect lower efficacy.

Licensing agreements

Days before the conference, Merck announced that it had signed royalty-free voluntary licensing agreements with seven generic companies – three in sub-Saharan Africa, and four in India. It’s the first time generic manufacturers in sub-Saharan Africa have been included in an initial HIV voluntary licence alongside Indian producers.

These companies will be permitted to sell generic alimatravir to 129 low- and middle-income countries. However, there are around 230,000 new HIV acquisitions each year in low- and middle-income countries that are not covered by the licences. Nearly half (112,000) of them are in Latin America, representing around 80% of the region's new HIV acquisitions. Brazil alone recorded 55,000 new acquisitions in 2024, followed by Mexico (22,000), Colombia (13,000), Peru (6,500), Argentina (5,000), Ecuador (1,900) and Paraguay (1,200).

Ironically, Argentina, Brazil and Colombia, all excluded from the licence, are hosting phase III trial sites that will help determine whether alimatravir works.

“It's not just the absolute number of infections that concerns us. HIV incidence is rising across Latin America, yet these countries are excluded from access to alimatravir, just as they have been for long-acting PrEP,” said Cross. “We can see that GDP does not discriminate. There are lots of countries [included in the licensing agreements] with a higher GDP than some of these Latin American countries, the likes of Argentina, Mexico, Brazil and Peru, yet these countries have been excluded.”

On 28 July, Merck's Brazilian subsidiary and the Oswaldo Cruz Foundation (Fiocruz) signed a memorandum of understanding (MOU) to evaluate a partnership on alimatravir. But the MOU does not change Brazil's exclusion from the 129-country voluntary licensing agreement.

Reaching $3 a year will require coordinated generic mass production, long-term financing, reliable country-level demand forecasts, integration with testing and treatment programmes, and adherence support.

"Alimatravir for $3 a year could be the cheapest HIV prevention drug the world has ever seen, affordable worldwide," Cross told the conference. "But it needs to be $3 everywhere, not just some places. Merck needs to do the right thing and extend voluntary licensing access to include all middle-income countries, especially the countries where the trials are taking place."