Comparative analysis of Indian pharmaceutical and medical devices sector

Kale, Dinar (2010). Comparative analysis of Indian pharmaceutical and medical devices sector. In: Pharmaceuticals in Developing and Emerging Economies: Production, Innovation, and Access to Medicines in the wake of TRIPS, 17-19 Sep 2010, Hyderabad, India.



Over the last decade the Indian pharmaceutical industry has emerged as a leading supplier of generic drugs to both developing and developed countries. The movement of the Indian pharmaceutical industry along the R&D value chain represents a remarkable shift for from public sector driven to private sector oriented innovation. Indian industry moved from an importer of drugs to imitator of drugs and a major supplier of medicines to other developing and advance countries. The Indian government’s industrial policies and adoption of weak regulatory system played a crucial role in shaping development of innovation capability. However compare to success of Indian pharmaceutical industry other crucial sectors in healthcare industry such as medical device industry has not witnessed similar growth. This paper studies factors that supported growth of pharmaceutical industry and issues that hampered development in the medical device industry in India. Evidence presented in this paper is based on the case studies of innovative products and firms in both sectors and for data analysis theoretical framework based on innovation systems literature is used. Initial findings suggest that highly knowledge intensive sector such as medical device requires interactive ecosystem of institutions compared to development of innovations in pharmaceutical industry. Further innovative product development in medical device industry is associated to firms and institutions working closely with practitioners and users unlike pharmaceutical product development where collaboration involves firms working with R&D institute and universities. Research reveals that in post independent era Indian government set up CSIR and other research institutes that created basic ecosystem which supported first, imitation and then innovation in Indian pharmaceutical industry. However Indian government failed to set up eco system of institutions and web of interactions between users and developers required for development of medical device industry.

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