To many women, Norplant was the long-awaited answer to birth control needs. No need to remember that daily pill. No messy and risky preparations. Few failures. Just allow a doctor to implant six small hormone-releasing rods into the upper arm - and, for five years, no unwanted pregnancies.

Obviously, the manufacturer, Wyeth-Ayerst Laboratories, was aware of the potential demand. Hence the price tag: $350. In other countries, a similar product sells for $23. But this is not merely the case of a company justifying huge profits by claiming high prices stem from the high costs of research and development.. As the Wall Street Journal reported last week, Norplant was developed with American taxpayer funds. Something called the Population Council developed the product with $10 million in grants from Washington and philanthropic agencies. Wyeth-Ayerst got first rights to Norplant because it. contains the company's hormone. It pays a very small royalty to the Population Council. Thus, the high price is pure profit.

Ayerst refuses to lower it. The company's just laughing - all the way to the bank.