Brazil is a model for developing countries in the fight against Aids

The deal to buy Atazanavir from the Bristol-Myers Squibb company will allow Brazil to save more than $60m a year.

It is the biggest discount that Brazil has obtained so far in its Aids programme, which offers anti-retroviral drugs free to patients.

Brazil has spearheaded an international campaign to force down the price of anti-Aids medication.

The number of Aids-related deaths in Brazil has fallen by half since the government began distributing free anti-retroviral drugs in 1997.

Brazil has put pressure on pharmaceutical companies to reduce their drug prices by threatening to make generic copies locally if they do not oblige.

Economic realities

The Brazilian health ministry said the deal with Bristol-Myers Squibb represented "a new form of relationship between the government and the laboratories".

The ministry said the agreement showed it was possible to provide treatment in developing countries while taking economic realities into account.

Atazanavir is one of 15 drugs used in the government's anti-Aids "cocktail" of treatment.

Under the new agreement, each capsule will now cost the health service $3.25 instead of $13.80.

Last month, the Brazilian Government launched a national campaign to encourage more people to take HIV tests.