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American Economic Review Vol. 106 No. 1 2016

The Market Impacts of Pharmaceutical Product Patents in Developing Countries: Evidence from India

Mark Duggan1; Craig Garthwaite2; Aparajita Goyal3

1 Department of Economics, Stanford University, 579 Serra Mall, Stanford, CA 94305, and NBER (e-mail: ) · 2 Kellogg School of Management, Northwestern University, 2001 Sheridan Road, Evanston, IL 60208, and NBER (e-mail: ). · 3 The World Bank, 1818 H Street, NW, Washington, DC 20433 (e-mail: )

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Abstract

In 2005, as the result of a World Trade Organization mandate, India implemented a patent reform for pharmaceuticals that was intended to comply with the 1995 Trade-Related Aspects of Intellectual Property Rights (TRIPS). Exploiting variation in the timing of patent decisions, we estimate that a molecule receiving a patent experienced an average price increase of just 3–6 percent, with larger increases for more recently developed molecules and for those produced by just one firm when the patent system began. Our results also show little impact on quantities sold or on the number of pharmaceutical firms operating in the market.

DOI
10.1257/aer.20141301
Volume
106
Issue
1
Pages
99-135
Language
en
Sources
openalex bibtex:phds-export.bib crossref

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