Clinton, announcing the next stage of the decade-long U.S. fight against AIDS around the world, said advances in drug treatment and prevention strategies had brought the end of the epidemic within reach.

"HIV may well be with us into the future but the diseases that it causes need not be," Clinton declared, saying it was possible to foresee a time when the number of people receiving treatment worldwide outpaces the number of new infections.

"That will be the tipping point. We will then get ahead of the epidemic, and an AIDS-free generation will be in sight," she said.

The U.S. PEPFAR program, launched by former President George W. Bush in 2003, has been a catalyst for advancing HIV treatment, particularly in Africa. It now supports some 5.1 million people worldwide who are receiving anti-retroviral drugs.

The U.N. AIDS program said this month that ending the pandemic was now "entirely feasible" as it released an annual report showing that both deaths from AIDS and new infections with the HIV virus that causes it were falling.

Worldwide some 34 million people were living with HIV at the end of 2011, the UNAIDS report said. Deaths from AIDS fell to 1.7 million in 2011, down from a peak of 2.3 million in 2005 and from 1.8 million in 2010.

The number of people newly infected with HIV, which can be transmitted via blood and by semen during sex, is also falling. At 2.5 million, the number of new infections in 2011 was 20 percent lower than in 2001.

Despite the good news, not everyone is optimistic that the end of the epidemic is around the corner.

The ONE foundation, a charity founded by Irish rock star Bono, said this week that budget cuts in major donor countries were slowing efforts to reduce new infections and that a goal set last year by global leaders of turning the corner on AIDS by 2015 was now unlikely to be reached until 2022.

NO CHILD BORN WITH AIDS VIRUS

The new PEPFAR blueprint aims to accelerate the fight by scaling up both drug treatment and new strategies for combating the spread of AIDS including voluntary male circumcision, microbicide gels and interventions to stop pregnant women from passing the virus on to their unborn children.

"We can reach a point where virtually no children are born with the virus, and as these children become teenagers and adults they are at far lower risk of acquiring HIV than they are today," Clinton said.

Clinton has lobbied hard to save U.S. overseas development spending in an era of increasingly tight budgets, and has stressed that Washington will not step back from the AIDS fight despite potential cuts to other programs.

The Obama administration has asked Congress for $6.4 billion for PEPFAR and other AIDS programs in 2013, down from $7.2 billion in 2012. Officials say economies of scale and savings from the purchase of generic drugs are making programs more efficient.

The U.S. government spent roughly $46 billion on AIDS, tuberculosis and malaria programs from 2003-2010.

U.S. Global AIDS Coordinator Eric Goosby said the new PEPFAR plan could likely lead to increased spending on anti-retroviral drugs as more people start the treatment earlier.

But he emphasized that the United States would not be paying for this alone, and said that U.S. efforts now would be to rally support from other donors as well as the recipient countries themselves.

"This administration has put a huge amount of political capital on this issue from day one. We remain committed. And we realize that we're the major motor on the planet," he said in an interview.

The new PEPFAR plan includes a greater emphasis on marginalized populations most at risk for HIV, including injecting drug users, sex workers and men who have sex with men, as well as turning over more responsibility for management and oversight to recipient countries.

Reaction to the new PEPFAR plan was broadly positive, although some advocates said the onus was now on Congress to fully fund the campaign.

"What we've needed for a while is an action plan that had caught up to the science of today. The blueprint takes us a step toward that," said Chris Collins, director of public policy at the Foundation for AIDS Research.

(Reporting By Andrew Quinn; Editing by Xavier Briand)

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