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Patents and pharmaceutical drugs : understanding the pressures on developing countries

  • Nogues, Julio

This paper offers a discussion to the question of why there are pressures on developing countries for introducing and/or reinforcing patent protection to pharmaceutical drugs. Patent protection is an important component of a complex strategy developed by the research and development intensive pharmaceutical drug companies of industrial countries to meet market competition. For legal and economic reasons, patents are fundamental instruments for allowing the drug-inventing companies to appropriate the returns from their inventions. Patents sustain high prices, which in turn provide rents to undertake further research and development, which in turn allows the invention of new drugs, etc. In recent years, increasing drug regulations have implied that effective patent protection to the research and development intensive pharmaceutical drug companies has eroded. Furthermore, competition from the generic drug companies has increased quite significantly. Restoring patent protection in industrial countries and making developing countries introduce patent protection, has become part of research and development intensive pharmaceutical companies'strategies to regain market share.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 502.

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Date of creation: 30 Sep 1990
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Handle: RePEc:wbk:wbrwps:502
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  1. Schut, Frederick T. & Van Bergeijk, Peter A. G., 1986. "International price discrimination: The pharmaceutical industry," World Development, Elsevier, vol. 14(9), pages 1141-1150, September.
  2. Gorecki, Paul K., 1986. "The importance of being first : The case of prescription drugs in Canada," International Journal of Industrial Organization, Elsevier, vol. 4(4), pages 371-395, December.
  3. Mansfield, Edwin, 1985. "How Rapidly Does New Industrial Technology Leak Out?," Journal of Industrial Economics, Wiley Blackwell, vol. 34(2), pages 217-23, December.
  4. McRae, James J. & Tapon, Francis, 1985. "Some empirical evidence on post-patent barriers to entry in the Canadian pharmaceutical industry," Journal of Health Economics, Elsevier, vol. 4(1), pages 43-61, March.
  5. Joglekar, Prafulla & Paterson, Morton L., 1986. "A closer look at the returns and risks of pharmaceutical R&D," Journal of Health Economics, Elsevier, vol. 5(2), pages 153-177, June.
  6. Edwin Mansfield, 1986. "Patents and Innovation: An Empirical Study," Management Science, INFORMS, vol. 32(2), pages 173-181, February.
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