Ministerial level talks at the meeting of the World Trade Organisation (WTO) in Qatar are reported to have reached an agreement effectively allowing developing countries to buy or manufacture cheap generic versions of drugs to treat HIV.
According to the BBC, the deal states that the World Trade Organisation's intellectual property rights (TRIPS), "shall not prevent members from taking measures to protect public health."
Although the agreement has yet to be sanctioned by the full WTO, officials say that they are confident it will get through, with an American representative quoted as saying "the pieces are beginning to fall into place."
The deal goes further than the US proposal at the end of last week which would have allowed countries to buy or make generic versions of drugs when faced by a "health emergency."
Under the new WTO proposal, governments will be able to able to seek a waiver on public health grounds from drug patents which normally last for 20 years. In theory South Africa and other developing countries would be able to obtain or manufacture the generic anti-HIV drugs manufactured by the Indian pharmaceutical company Cipla at $350 per patient per year.
US concessions on drug patents appear to be tied in with talks on other issues at the WTO talks, particularly European Union (EU) farming subsidies. The EU had positioned itself as an "honest broker" in the talks on drug patents, leading to criticism from all sides.
The International Federation of Pharmaceutical Manufacturers has expressed disappointment with the deal accusing the EU of siding with developing countries to progress its own environmental and agricultural agenda. However, the UK government has been criticised for offering too much support to the pharmaceutical industry prompting UK Trade Secretary, Patricia Hewitt to say, "We are determined that poor people get the medicines they need."