Although the global pharmaceutical industry is largely dominated by firms from Europe and North America, India now has the third largest pharmaceutical industry in the world when measured by production volume. Many other developing countries attempted to establish domestic pharmaceutical industries, but India had the most success by far, emerging as the "generics pharma capital of the world" and as supplier of most of the world's anti-retroviral drugs. This doctoral dissertation research project will explore how India, which had weak patent laws and a so-called "failed developmental state," has developed such a significant pharmaceutical industry. Most recent explanations have examined intellectual property rights, which now are a condition of World Trade Organization membership, but have not considered as extensively the roles of other state policies including price controls, restrictions on monopolies, and foreign investment. The doctoral student will conduct interviews with key stakeholders in the industry (Indian pharmaceutical firms, industry association groups, and government policymakers) and will gather secondary data from archival research of government policy documents, company reports, and industry association group publications. This project will produce a historically grounded investigation of the emergence of India's pharmaceutical industry. The results of the research are expected to illuminate how the Indian state and the pharmaceutical industry interacted, often with unintended consequences, to develop a high-tech industry in a developing nation.
This project will focus on a surprising case of industrial development, the Indian pharmaceutical industry, which has defied a series of adverse global political and economic circumstances over the course of its historical evolution. It is currently restructuring as a result of ongoing measures towards liberalization as well as the impact of changing patent laws. By providing a detailed account of the political-economic development of the Indian pharmaceutical industry, the project will contribute to basic understanding of the roles of intellectual property regulations and the state in industrialization and their implications for development policy. This project has potential implications for the strategies to be employed by developing nations to counter unfavorable terms of trade with developed nations, and it may suggest new forms of global governance that might offer fairer developmental opportunities. As a Doctoral Dissertation Research Improvement award, this award also will provide support to enable a promising student to establish a strong independent research career.
This research project investigated the political-economic context surrounding the development of the Indian pharmaceutical industry, known as the "pharmacy to the developing world" for its supply of low-cost medicines. The study, which drew on more than 85 primary interviews in India as well as analysis of a number of secondary documents, examined: 1) how changes in patent law impact development; 2) the role of integration into global production networks in development; and 3) the possibility of a more socially-oriented framework for the developmental state. The project found that while weak patents from 1970 to 2005 played a key role in the development of the Indian pharmaceutical industry, the patent law change in 2005 in compliance with the World Trade Organisation’s Trade-Related Aspects of Intellectual Property Rights (TRIPs) Agreement had much less impact than anticipated. Arguments on both sides of the TRIPs debate may have exaggerated the impact of patents, with much knowledge already geographically rooted without patents. The specific impact of patents must to be understood in relation to the wider institutional environment, particularly technological capabilities. The project also examined various stages of India’s integration into pharmaceutical global production networks and their development impact. In contrast to an emphasis on development occurring through participation in the production networks of global lead firms, it was found that the Indian state’s active pursuit of "strategic decoupling" from such networks, and subsequent recoupling, helped foster the establishment of a domestically-owned industry. Finally, the project engages with the challenges of constructing a socially-oriented developmental state, demonstrating how social policies can act as an industry promotion policy. The impact of civil society as a public accountability mechanism in such a state is highly uneven across different policy areas. In sum, the "pharmacy of the developing world" was built through limited patent coverage, strategic decoupling and a socially-oriented developmental state, all of which contravene current (post)Washington Consensus recommendations. The project incorporates broader perspectives and concerns from the global South into economic geography. Patent laws are interpreted not just as measures of innovation, but are analysed for their impact on development. "Strategic decoupling" is identified as a strategy which territories may adopt to overcome negative forms of incorporation in the global economy. With many policymakers re-evaluating the role of the state in development, the research outlines challenges faced in that regard and re-integrates the state and national scale of analysis into economic geography.
