Building Local Research and Development Capacity for the Prevention and Cure of Neglected Diseases: The Case of India

Article excerpt

Voir page 746 le resume en francais. En la pagina 746 figura un resumen en espanol.


Health and economic development are positively linked, and external investment is needed to break the vicious cycle of poor health and poverty that afflicts the less developed countries. The disease burden per person in these countries, measured in disability-adjusted life years, is twice that in the established market economies. Furthermore, over 40% of the healthy years lost in the less developed countries are attributable to communicable, maternal, and perinatal diseases, many of which never existed or have been all but eradicated in the established market economies (1).

The prevention and cure of these neglected diseases have received inadequate attention from global public health and research institutions and from private industry. In 1992, for example, only US$ 2.4 billion were dedicated to these diseases globally, approximately 4% of the total invested in health care (2). It has been estimated that the average cost of research and development (R&D) for new products is between US$ 300 and 600 million, and that it takes between 10 and 12 years to get from laboratory to market, although these figures vary with the therapeutic category (3-5). Because, in financial terms, the expected markets associated with malaria, tuberculosis, and less well-known diseases such as African trypanosomiasis and schistosomiasis are small, industry does not make them a priority, despite the significant need for new products (6-8).

Debate on how to tackle the lack of effective, affordable and accessible products for neglected diseases tends to focus on the following possible approaches. First, combining push (cost-reducing) and pull (market-enhancing) incentives with a view to encouraging private industry to invest more in these diseases. Second, establishing more partnerships that pool public capital with private experience in order to target specific diseases on the basis of early progress, which still has to be validated, of disease-focused public-private initiatives, such as the Medicines for Malaria Venture and the International AIDS Vaccine Initiative.

A third approach that warrants consideration in conjunction with the previous two involves building R&D capabilities to focus on new treatments for neglected diseases in countries such as Argentina, Brazil, and India, where emerging pharmaceutical industries and neglected diseases both exist. Local companies in endemic regions might have a greater incentive and a comparative advantage over multinational corporations in carrying out cost-effective research in this field. Economic arguments and empirical studies suggest that there are sizeable challenges to the development of innovative R&D capabilities in respect of neglected diseases. We use the case of India to investigate some of these challenges.

The Indian pharmaceutical industry

Efforts to build R&D capabilities in the developing world could focus initially on countries that already have pharmaceutical expertise and some innovative capabilities. In 1992 it was considered that Argentina, Brazil, China, India, Mexico, and the Republic of Korea met these criteria (9). The case of India is developed here.

In many ways, past Indian governments' policies which were geared to develop a self-reliant pharmaceutical industry have succeeded. In 1970, at the time of the introduction of the first policies, the Indian pharmaceutical industry was dominated by foreign subsidiaries of multinational corporations. Only 2 of the 10 pharmaceutical firms with the largest retail sales were Indian. Much of the country's pharmaceutical consumption was met by imports (10, 11).

Steps taken in 1970 and subsequently to promote a domestic industry included: first, the passing of the Indian Patent Act, which eliminated all product patent protection, reduced the period of validity of process patents from 20 to 7 years, and allowed the introduction of automatic licensing; second, the imposition of import restrictions on drug formulations and the introduction of high import taxes on critical inputs; and third, the introduction of price controls. …