Patents and the faster introduction of new drugs in developing countries

Abstract

This paper finds that product patent regimes spur faster introduction of new HIV/AIDS drugs only in those developing countries with relatively equally distributed incomes.

Acknowledgements

I thank Jayashree Watal's leading role and support, and Dani Rodrik's encouragement during the implementation of the CID project on studying the impact of patents on the access, pricing and introduction of HIV/AIDS drugs in developing countries. I thank Richard Caves, Ian Cockburn and Ariel Pakes for helpful comments and suggestions. I gratefully acknowledge the comments from many participants at Harvard, NBER and University of Barcelona Seminars. While working on this paper I was a postdoctoral fellow at the Harvard Economics Department. I thank my host. I gratefully acknowledge funding from the CID, and unrestricted educational grants from the Fundacion Ramon Areces (Madrid, Spain) and The Merck Foundation, the philanthropic arm of Merck & Co. Inc., Whitehouse Station (New Jersey, USA). Remaining errors and omissions are the sole responsibility of the author.

Notes

Lanjouw and Cockburn (2001) report that interviewed drug firm executives believed that faster introductions of new products and greater investments in marketing and educating the local medical community about new therapies were the major benefits from the introduction of product patents in developing countries.

See Articles 70.8 and 70.9 of the TRIPS Agreement. The four molecules in the TRIPS net are Nelfinavir, Delavirdine, Ritonavir, and Efavirenz.