| Summary/Abstract |
The paper analyzes the effect of India's membership in the World Trade Organization (WTO) and its signing of the TRIPs agreement on the pharmaceutical industry in general and the Indian sector in particular. First, it examines the effect of the implementation of the provisions of TRIPs on the growth of the national and multinational sectors of the industry. Second, it analyzes whether the new WTO rules will necessarily benefit pharmaceutical companies from the West, especially the United States and Switzerland, and whether there is evidence to support the assertion made by industry insiders that by 2015 multinational corporations will reestablish their monopoly of the industry by controlling at least 60% of the Indian market. Third, it investigates whether the multinational monopoly of the drug industry has had—or will have—a negative consequence for Indian consumers. Finally, the article examines the ways in which Indian companies are responding to the challenges of globalization and analyzes their new strategies, such as (1) outsourcing deals with multinationals to produce generic and patented drugs, (2) increasing R&D activities to enable them to make a transition from being drug “imitators” to drug “innovators,” (3) undertaking contract research, including outsourced clinical trials, (4) collaborating in joint R&D and product and process development to synergize their knowledge-base and effectively exploit available human resources and infrastructure (Ranbaxy's alliance with GlaxoSmithKline), and (5) undergoing a consolidation phase through indigenous mergers and acquisitions and strategic alliances.
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