India is not, yet, a wealthy country. Nevertheless its people experience many of the same expensive-to-treat illnesses as wealthier populations in the U.S. and Europe. Therefore the country has made a series of policy decisions designed to lower the cost of medical treatments. For example, until 2005, it offered no – I repeat, no – patent protection for pharmaceutical products, thereby spurring the development of its robust and relatively inexpensive generic industry. Even when India passed patent laws in 2005, the laws only offered weak protections. When new drugs come on to the Indian market, they typically face generic competition less than, gulp, 12 months after their launch.
The upside of these policies is straight forward. Drugs in India are cheap, often way less expensive than the cost of the same medications in the U.S. or Europe. But India’s policies create a less obvious, but very important, downside – they delay the entry of new pharmaceutical products into the Indian market. (To read the rest of this article, and to leave comments, please visit Forbes.)