International development secretary Clare Short has criticised the pharmaceutical industry for failing to invest in drugs that tackle the "diseases of poverty".

Ms Short said more new drugs and vaccines were urgently need to tackle diseases such as malaria, TB and AIDS that kill millions in the developing world.

"We live in an area of technical innovation that is bringing huge benefits but the reality is that most of this effort is targeted at diseases that are only of relevance in the industrialised world," she said.

Speaking in Geneva, Ms Short said that the need to make a return on investments and build major markets meant major pharmaceutical companies tended to ignore diseases that affect the poor.

Only 10% of global research funds are dedicated to the 90% of disease burden that affects the poorest Clare Short, International Development Secretary

"Only 10% of global research funds are dedicated to the 90% of disease burden that affects the poorest," the Secretary of State said.

Ms Short claimed that globalisation, in creating major international partnerships, held out hope for greater investment in vaccines and medicines to treat the major diseases of the developing world.

Incentives

Ms Short called for new incentives to encourage industry investment, such as developing an equity pricing system.

This would allow companies to sell drugs close to cost price in poor countries and at a profit in developed countries, so they can recoup research costs.

Other steps could include guaranteeing that governments would buy vaccines from drug companies when they are developed and granting licenses to local manufacturers in developing countries to make patented drugs cheaply.

We would be happy to work with governments and other agencies to discuss ways in which we can justify investment in these areas to our shareholders Richard Ley, ABPI

Richard Ley, spokesman for the Association of the British Pharmaceutical Industry welcomed Ms Short's comments as "very much the direction we want to move in".

"We would be happy to work with governments and other agencies to discuss ways in which we can justify investment in these areas to our shareholders," he said.

Ms Short highlighted innovative partnerships which are attempting to tackle the huge burden of disease in the developing world.

She cited examples such as the World Health Organisation's Roll Back Malaria partnership and the Global Alliance for Vaccines Initiative.

Developing world diseases

Malaria kills one million people a year TB kills 2 million people a year AIDS killed 2.5 million in 1998

Malaria kills more than one million people a year, almost all of them in Africa and affects a further 500 million a year.

The Department for International Development has already pledged �60m to the partnership which aims to halve the number of malaria deaths by 2010.

The Global Alliance for Vaccines, a coalition of governments and public and private sector organisations, led by WHO, aims to ensure every child is protected against vaccine-preventable diseases.

With AIDS the leading cause of death in Africa, the DFID has also contributed �14m to the International AIDS Vaccine Initiative.