Future of Indian pharmaceutical industry post trips and patent(amendments), act 2005

Abstract

The pharmaceutical industry in India had achieved self-sufficiency because India allowed for a loosely defined IPR regime. But the implementation of TRIPS worldwide essentially represents a big step in the opposite direction and throws a new challenge to the Indian pharmaceutical industry to maintain its competitiveness and profitability. The impact of the product patent regime on technology transfer, FDI inflow in the pharmaceutical sector, and R and D, innovative and patenting activities of the pharmaceutical firms is not clear. Besides, the new IPR regime may have far-reaching consequences on access to medicine sat affordable prices in a large number of developing and least developed countries. Theoretically, compulsory licensing, as provided for under the TRIPS Agreement, or merely the threat of its use, could be used as a price leveraging instrument in developing countries. This study is an attempt to investigate the likely effect of TRIPS compliance on emerging business strategies of the pharmaceutical companies, R and D, innovative and patenting activities of the Indian pharmaceutical firms, and technology transfer and FDI inflow in the pharmaceutical sector and the efficacy of compulsory licensing in controlling the prices of the drugs. The study concludes that the Indian firms are facing severe challenges to adapt to the emerging patent regime and are adopting a mix of competitive and collaborative business strategies to address these challenges. The emerging strategies of Indian firms will continue to be dictated mostly by survival needs and not by issues related to access to medicines of the general public. The study also concludes that the Indian firms do face several difficulties with India s TRIPS compliance in accessing new technologies. The study further suggest that the regulatory changes in India have stimulated the Indian pharmaceutical firms to undertake greater innovative activities to capture the generic drug market on the basis of their low-cost ability to do reverse-engineering . Lastly, the study suggested that product patent protection in India is emerging to be a very decisive factor in determining access to medicines, both in India and other developing countries and least developed countries and the compulsory licensing may not be a very effective tool in making drugs available to the poor in developing and least developed countries.