Moving from Rhetoric to Reality: South-South Collaboration in Health Biotechnology

By Thorsteinsdottir, Halla; Kapoor, Andrew | International Trade Forum, April-June 2010 | Go to article overview

Moving from Rhetoric to Reality: South-South Collaboration in Health Biotechnology


Thorsteinsdottir, Halla, Kapoor, Andrew, International Trade Forum


A study conducted into the health biotechnology sector in six developing countries with substantial biotechnology industries throws new light on far-reaching productive results of cooperation within the sector. The emergence of postcolonial South-South collaboration in these countries is helping move joint activity beyond political rhetoric to a substantial economic reality, despite most international ties in developing countries remaining with the North.

The size of the world pharmaceutical markets

According to the WorldPharma report Emerging Influence: Industry in Figures, (1) in 2008 the combined size of emerging markets (including China, Brazil, India, Republic of Korea, Mexico, Turkey and the Russian Federation) reached about US$ 105-115 billion. These figures can be compared to the market size of the United States of America (about US$ 287-297 billion) and the top five European Union (EU) countries (France, Germany, Italy, Spain and the United Kingdom) with sales of US$162-172 billion.

Growth in developing markets

Although the pharmaceutical market worldwide experienced moderate growth in 2008, the global recession and tighter regulations took their toll on developed markets. In contrast, sales in developing nations witnessed a growth spurt. In comparing respective growth rates, the United States pharmaceutical market, the world's largest, was forecast to grow by 1-2% and the top five EU countries were expected to grow at a rate of 3-4%. However, the emerging markets were projected to grow at a combined rate of 14-15%, five times that of the developed markets.

South-South collaboration

Developing countries have established a number of regional free--trade zones and South-focused trade agreements. Some examples are the Southern Common Market in Latin America, the Common Market for Eastern and Southern Africa and the India, Brazil and South Africa trilateral agreement. Firms in various developing countries have started to form alliances in order to reach each other's markets. Knowledge about these linkages, the opportunities they present and whether cooperation extends to science-intensive sectors such as health biotechnology has been limited. Other questions in the study were whether the collaboration was restricted to trade or involved joint research and development and other innovation activities.

To better understand the extent and characteristics of South--South collaboration in the health biotechnology sector, the University of Toronto carried out a brief survey, together with a number of partners in developing countries, of 467 health biotechnology firms in six developing countries with relatively strong biotechnology sectors: Brazil, China, Cuba, Egypt, India and South Africa. (2) Representatives of the firms were asked whether they collaborated with companies or other organizations in other low-and middle-income countries. If so, they were asked to provide information on their cooperation. A total of 288 firms responded to the survey, a response rate of 62%.

The survey revealed a surprisingly high level of South--South collaboration, with more than a quarter of the firms (27%) indicating they are actively working together with other developing countries in health biotechnology. South--North collaboration still dominates, with more than half (53%) of the firms reporting collaboration with developed countries. Joint South--South activity revolved mostly around end-stage commercialization activities, with 72% of the collaboration involving distribution and 34% involving marketing activities. In comparison, only 13% of the joint activities involved research and development.

Most cooperation is between the leading developing countries in health biotechnology. Brazilian firms work relatively intensively with China and Cuba. Chinese firms collaborate heavily with India and Indian firms have frequent linkages with South Africa. Similarly, Brazil works in partnership with Argentina and South Africa with Botswana. …

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