Trips-Compliant New Patents Act and Indian Pharmaceutical Sector: Directions in Strategy and R&D (Research and Development‪)‬

With the much awaited amendment in the Patents Act in March 2005, retroactive to Jan. 1, 2005, India has finally met its obligations under the TRIPS agreement. However, this has set a new debate not only in India but also in other developing countries, especially from the African subcontinent, regarding its fallout on the affordability of drugs to poor nations. Within India, the opinions are divided regarding its implications for the survival and growth of the pharmaceutical industry. This article traces the history and the current profile of the Indian pharmaceutical industry, taking note of the prominent changes in the new Act over the last Patents Act of 1970 and presents an analysis on the impact of such changes on the Indian pharmaceutical sector in terms of strategy choices and R&D directions. The study concludes that most dynamic Indian pharmaceutical players are likely to adopt a combination of 'cooperate and compete' strategies to ensure a smooth transition from reverse engineering based to research-based pharmaceutical firms. The analyses also suggest that there may be considerable inflow of outsourcing business to India in the realms of clinical trials, contract research and manufacturing. INTRODUCTION