HIV Prophylaxis


HIV is most prevalent in the developing regions of the world. 70% of the global HIV population lives in Africa. Currently, 24.9 million Africans are HIV infected Roughly 1.6 million African people died of AIDS-related illnesses in 2012. Due to larger awareness campaigns, deaths related due to HIV have reduced from 1.8 million in 2005 to 1.2 million in 2011. However, the number of new infections has remained constant. According to the UNAIDS, there were approximately 1.6 million new HIV infections in adult sub-Saharan Africans in 2012. Of the 23.5 million people living with HIV in the sub-Saharan African region, approximately 60% are women. Based on these facts, we believe that approximately 1 million women living in sub-Saharan Africa are newly HIV infected each year. Below are some facts and assumptions that will help us understand the market potential of our proposed sustained release ARV IVRs:

Number of sexually active women (ages 18-45) living in Africa = 269 million

Number of sexually active African women already living with HIV = 15 million

Number of sexually active African women that are not HIV-infected = 254 million

Cost to manufacture Auritec’s ARV IVRs = $2.50

Target selling price to our customers (The Gates Foundations, USIAD and other charitable foundations)

= $3 per ARV IVR (10 cents per day)

Target profit for each ARV sold = $0.50

Annual utilization of ARVs per woman = 1 per month * 12 = 12 ARV IVRs.

− Initial target @ 1% penetration = 30 million rings; potential profit at $0.50 = $15M

− Market penetration of 25% = 750 million rings; potential profit = $375M

We believe that an effective ARV IVRs will have a high compliance rate; however, we understand that acceptance rate of an IVR will be lower initially. We conservatively estimate the market penetration to be in the range of 1% in the first year of product launch (2022), and expect it to increase to up to 25% in 10 years following product launch. Please note that these projections are much more conservative than the Rockefeller Foundation estimates which predict utilization rates by married women of 30% and 50% by unmarried women. Product sales in Africa might also be hampered by competition; however, based on the scientific superiority of our technology, we believe that we have a great chance of being the leaders in this field. It is our expectation that other preventive measures such as condoms will not negatively impact our product utilization rate as they will be used in conjunction to our product. We have tried our best to make projections by taking in to account competitor products, fluctuating compliance/adherence rates and overall market dynamics. We are convinced about the market potential of an ARV IVR for a small company, and believe that acceptance rates will increase steadily once our IVRs demonstrate initial success in preventing HIV infections. Depending on our profit scenario, we will be open to the idea of giving further discounts and/or free IVRs to charitable foundations.