The Cross-Border Biotech Blog

Biotechnology, Health and Business in Canada, the United States and Worldwide

Trends Update — IP Constituencies: India M&A Spurs Pricing Concerns

world_map_2002We’ve been following the trend of increased innovative activity in developing countries, and have noted its likely effect on IP protection in those jurisdictions. In a variation on that theme, an article last Thursday in DNA suggests that

“Indian companies, which have been actively pursuing pre-grant and post-grant oppositions against the patents of MNCs, would become less aggressive after being acquired by Big Pharma.”

This seems like a plausible outcome, although it is counterbalanced by the increasing stake innovator companies are taking in generics and follow-on biologics companies.  It is also counterbalanced by statistics from Navroz Mahudawala at Ernst & Young (cited at the end of the article) showing that multi-national companies’ share of India’s pharma market has actually dropped by almost half over the last two decades. What is more interesting to me, though, is the nature of those investments, which appear to have been shifting to rely more heavily on India’s R&D capabilities. These domestic R&D capabilities will be the real driver of change in attitudes toward IP protections.

In light of shifting IP attitudes, the pricing of drugs is a legitimate concern, but consider what I’ll dub “the innovation cycle” — India’s increased R&D capabilities will fund higher incomes and help citizens afford higher-priced drugs, while countries that may have been importing India’s generics will be forced to develop their own generics production capabilities, which may eventually (as in India) lead to innovative R&D, etc., etc.

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