GlaxoSmithKline (GSK) has cut the price of its leading Combivir treatment in poor countries by 47 per cent to under $1 a day.
The move by the world's largest maker of HIV/AIDS drugs is the latest sign the international pharmaceutical industry is bowing to pressure to improve access to life-saving antiretroviral medicines in Africa and other parts of the developing world where AIDS has hit hardest.
Investors have recently begun demanding such action - they fear a failure to respond adequately could damage company reputations and jeopardise future profits.
GSK's second price cut in seven months brings the cost of Combivir to governments, non-governmental organisations and many employers down to 90 US cents per patient a day from $1.70.
The medicine - a combination of AZT and 3TC - is central to many triple-drug therapies that have turned HIV infection into a manageable condition in the West but are largely unavailable in developing countries.
The price for the two component drugs, when sold separately, will also come down by 38 and 45 per cent respectively to 75 and 35 cents a day in the 63 countries eligible for the scheme.
British-based GSK, which has stated in the past it would not sell AIDS drug sales at a profit in the developing world, said the price cuts were made possible by continuing improvements in manufacturing processes and economies of scale.
Industry critics were sceptical of this.