It is India's most heavily researched herbal medicine, injected into mice and force-fed to laboratory rats from Bangalore, to Bombay, to New Delhi. Yet the sacred neem tree, planted throughout the subcontinent and known as "the village pharmacy", is virtually unheard of in Britain. Once, in the late 90s, Azadiracta indica rose to fame briefly when the world's pharmaceutical giants squabbled over "ownership" of the tree's health-giving properties. In a row that infuriated environmentalists, 70 patents were applied for - and some granted - on specific genes and mechanisms associated with the plant. How could anyone own a product of nature?

Since then, the herb has retreated into relative obscurity in Europe but in the US, where it is aggressively marketed on the internet, it has achieved high-fashion status. Supermodel Christy Turlington includes Neem night cream in her Sundari range of ayurvedic beauty products, and the tree's seemingly magical qualities have made it a favourite with second-wave hippies and New Agers. If we believe the hype, neem can treat anything from diabetes, malaria, psoriasis and heart disease, to boils, wounds, duodenal ulcers and unwanted pregnancies.

"Used as a vaginal lubricant," one website claims, "neem oil is up to 100% effective in preventing pregnancy." In India and the US, the blurb continues, trials show that neem "reduces fertility in male monkeys without inhibiting libido or sperm production, making it potentially the first male birth control pill".

"I've never heard of that," jokes Dr Kartik Chandra Ray, a West Midlands GP who often prescribes neem at his surgery in Walsall. "But there is plenty of evidence relating to the other conditions. It is hard for me to point to specific papers because I base my medicine on what I have seen. My father was a doctor in India."

Though 70% of his patients are Asian, the remainder are white and turn to neem when conventional medicine fails. "I prescribe the leaves to diabetics," he says, "because it helps the liver, which in turn stimulates the pancreas to secrete more insulin. I also recommend neem soap for eczema, and neem toothpaste for gingivitis."

Before penicillin came to India in 1942, Dr Ray explains, neem was the only antibiotic and is still used to treat viruses today. "During the epidemic season, from late February to April," he says, "chickenpox and measles arrive in a big way. For those already infected, neem produces a soothing sensation. Before infection, the cooked leaves have a cholagogue effect - they stimulate the liver to produce folic acid, bile and hormones which boost immunity and stop people getting ill in the first place."

Ray's claims are backed up by hundreds of clinical trials, mainly in India, confirming the tree's protective qualities - particularly against malaria. One active ingredient, irodin A, has been shown to be highly toxic to strains of malaria that prove resistant to drugs. In the laboratory, it killed off 100% of the bacillae within 72 hours. Another ingredient, nimbin (found in the tree's bark) is known to have anti-inflammatory, anti-fungal and anti-histamine qualities, while nimbidin (also in the bark) is anti-bacterial, combats ulcers and acts as an analgesic.

This explains why neem twigs are traditionally chewed, then used as a toothbrush - an application endorsed by researchers in Germany, who found that neem bark extracts were effective against tooth decay and periodontal disease, such as gingivitis. Indeed, so potent are the active ingredients in neem, it has even proved effective against Aids. In the US, the National Institutes of Health has confirmed that neem extract reliably kills the virus and has been patented as an Aids treatment.

So can such a powerful medicine be safe? Indian doctors argue that the herb has been used for 5,000 years by ayurvedic healers (in the form of tea, ointment, oil and poultice) without recorded side effects when used in moderation - a safety record far better than most orthodox medicines. However, given its traditional use as a contraceptive, the herb should not be taken by women who are pregnant or breastfeeding. In the ayurvedic system, neem is usually prescribed in combination with other herbs that cancel out its toxicity. The best advice is to use neem only as recommended by an ayurvedic herbalist or an Asian GP such as Ray. Don't be tempted to buy it on the internet and self-treat.

· Next time: hops