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Intellectual Property Protection, Regulation and Innovation in Developing Economies - The Case of Indian Pharmaceutical Industry

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  • Basant, Rakesh
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    Abstract

    Historically, nations have modified their IP policies to support their development agenda. With the advent of TRIPS, the ability of countries to choose between different IP policy options has reduced considerably but some flexibility remains. Countries have tried to utilize this flexibility for their advantage but in certain respects the choices are difficult. In recent years, certain elements of the new IP regime in India have been vigorously debated in the context of the TRIPS mandated IP policy changes. Given the complex interface between economic development and IP regimes, a variety of arguments have been deployed to argue in favour or against these elements. The paper argues that an evaluation of the IP regime and regulation in developing countries needs to be done in the context of how they facilitate capability building especially through participation of domestic firms in global R&D and production networks. Opportunities for domestic firms to participate in global networks depend on a variety of inter-related factors like emerging technology regimes, changes in global industrial structures, strategies followed by MNCs and capabilities and strategies of domestic firms with respect to innovation. Consequently, the fine-tuning of the IP regime would require an understanding of these developments as well, often in the context of a specific sector. The paper uses this broad heuristic framework to analyze emerging IP policy needs for the Indian pharmaceutical sector and the role of other types of regulation. In the process it also provides some insights on how developing countries with decent technological capabilities can exploit regulatory flexibilities available in the post-TRIPS scenario.

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    Paper provided by Indian Institute of Management Ahmedabad, Research and Publication Department in its series IIMA Working Papers with number WP2010-11-02.

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    Handle: RePEc:iim:iimawp:wp2010-11-02

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    1. Athreye, Suma & Kale, Dinar & Ramani, Shyama V., 2008. "Experimentation with Strategy and the Evolution of Dynamic Capability in the Indian Pharmaceutical Sector," MERIT Working Papers 041, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    2. Ernst, Dieter & Kim, Linsu, 2002. "Global production networks, knowledge diffusion, and local capability formation," Research Policy, Elsevier, vol. 31(8-9), pages 1417-1429, December.
    3. Stuart Graham & David Mowrey, 2004. "Submarines in software? continuations in US software patenting in the 1980s and 1990s," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 13(5), pages 443-456.
    4. Dieter Ernst, 2000. "Global Production Networks and the Changing Geography of Innovation Systems: Implications for Developing Countries," Economics Study Area Working Papers 09, East-West Center, Economics Study Area.
    5. Rod Falvey & Neil Foster & David Greenaway, 2006. "Intellectual Property Rights and Economic Growth," Review of Development Economics, Wiley Blackwell, vol. 10(4), pages 700-719, November.
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