Nov 19, 2001|
WTO: Will Indian pharma benefit?
The recent WTO talks has once again raised controversy over whether health emergencies be given precedence over intellectual property rights. A WTO declaration on TRIPS signed last Wednesday is expected to give developing countries the explicit right to override foreign companies patents for drugs dealing with specific problems, which includes malaria, TB, HIV/ AIDS and cancer.
This could give a major blow to MNC drug companies, which thrive on patent protection. This controversy was sparked off recently when Cipla offered to supply anti-AIDS drugs to the AIDS inflicted South African patients at a fraction of the cost at which Glaxo was selling in the world market. Given the backdrop of recent Cipro-D deal with Bayer for Anthrax, it was harder for the US to argue in favour of intellectual property rights.
Though the agreement is not expected to give a big threat to the large MNC's in the near term as contribution from developing countries is small at this point of time. However, it has other far-reaching implications. One, it would provide developing countries with a higher bargaining power. South Africa for example, has already won legal victories against big U.S. drug companies last year. Secondly, wide price margins and burgeoning healthcare cost of the government would force legislators in the developed nations to pave way for a faster entry of generics, thus contracting patent life for MNC's. Further, these MNC's would lose out on export opportunities to some fast growing economies.
Now does that mean a big export opportunity for Cipla's and Dr. Reddy's? Considering that the deal has not explicitly allowed import of drugs by underprivileged nations, India is expected to benefit only marginally on the generic business. However, the opportunity for Indian firms may come from the fact though India will stick to its 2005 deadline to recognize product patent, specific cases of reverse engineering may still continue even beyond that.
More Views on News
Aug 14, 2017
A challenging environment and one-time expense pushes Sun Pharma into a loss in the first quarter.
Aug 14, 2017
GST impact coupled with price erosion in US leads to lower profits for the quarter.
Aug 8, 2017
Profits plunge due to higher raw material costs.
Jun 16, 2017
Here's what you can expect from The 5 Minute Wrapup in the coming months and years.
Jun 23, 2017
Net Profit lower due to exceptional items in the previous year.
More Views on News
Aug 17, 2017
A small-cap Indian company with high-return potential and blue-chip-like stability is set to supplant the Chinese players in this niche segment.
Aug 21, 2017
Most Indians who cannot find jobs, look at becoming self-employed.
Aug 16, 2017
The IT Sector could be in an uptrend till February 2019. Are you prepared to ride the trend?
Aug 22, 2017
Post demonetisation, a cut in bank savings deposits rates was in the offing.
Aug 16, 2017
Ensure your financial Independence, and pledge to start the journey towards financial freedom today!
Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement. LEGAL DISCLAIMER:
Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here
. The performance data quoted represents past performance and does not guarantee future results.SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: firstname.lastname@example.org. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407