3 ms·

Why is it so much cheaper in India or China? Labor cost? No EPA? It has to be so cheap that the cost of offshoring and coordinating all that is dwarfed by the

by api 3y ago

Why is it so much cheaper in India or China? Labor cost? No EPA? It has to be so cheap that the cost of offshoring and coordinating all that is dwarfed by the savings.

alephnerd 3y ago
IP Enforcement. If I'm a European, Israeli, or Japanese conglomerate that wants to make a clone of Pfizer or Abbott compounds, I can't do that in the EU or US+Canada because I'd be sued for patent infringement. On the other hand, India, Israel, and Japan don't recognize or enforce American patents for pharmacuticals. After Israel and Japan became developed countries in the 80s-90s, it became expensive to manufacture within both, so the Pharma companies like Teva and Takeda began investing heavily in the Indian Pharma manufacturing base in the Himachal Pradesh-Chandigarh-Haryana-Uttarakhand corridor and the Hyderabad-Pune corridor.
- unmole 3y ago
  Yeah, no. If what you said was true, The Serum Institute of India wouldn't have licensed the Oxford-AZ vaccine. Same applies for drugs like Molnupiravir where local manufacturers licenced the drug from Merck. Even if these manufacturers were able to get away with patent violations, they still wouldn't be able to export them to the biggest and richest markets.
  - alephnerd 3y ago
    The COVID vaccine was a bad example as it was manufacted on license from AstraZeneca, but the larger Indian market absolutely does this due to how the Indian Patent Act is structured. "Section 3(d) of the Patents Act, 1970, explains that a new form of a known substance, new property / new use for a known substance and the mere use of a known process are not patentable and is not considered distinct from the known substance. Based on this principle, inventions using known substances are not patentable unless, for example, the alleged invention displays a significant increase in efficacy." [0] Ranbaxy, Reddy Labs, and Sun Pharma all started thanks to this loophole, and it has been a massive blocker in any US-India Free Trade Agreement. This is all open knowledge to all players in the India market [1]. It's not necessarily a bad thing btw - it's a major reason India's Pharma and Agrochemical R&D pipeline punches above its weight, but it has an impact on US-India relations, but for other regions such as the EU, Japan, or Developing countries it doesn't have much of an impact. [0] https://www.aipla.org/list/innovate-articles/the-global-significance-of-india-s-pharmaceutical-patent-laws https://www.aipla.org/list/innovate-articles/the-global-sign... [1] https://www.nishithdesai.com/fileadmin/user_upload/pdfs/Patents_and_the_Indian_Pharmaceutical_Industry.pdf https://www.nishithdesai.com/fileadmin/user_upload/pdfs/Pate...
    - unmole 3y ago
      Sure, the fact that the patent regime in India doesn't allow evergreening is common knowledge. But that is not what your original comment said.

by api 3y ago

Why is it so much cheaper in India or China? Labor cost? No EPA? It has to be so cheap that the cost of offshoring and coordinating all that is dwarfed by the savings.

alephnerd 3y ago

IP Enforcement. If I'm a European, Israeli, or Japanese conglomerate that wants to make a clone of Pfizer or Abbott compounds, I can't do that in the EU or US+Canada because I'd be sued for patent infringement. On the other hand, India, Israel, and Japan don't recognize or enforce American patents for pharmacuticals. After Israel and Japan became developed countries in the 80s-90s, it became expensive to manufacture within both, so the Pharma companies like Teva and Takeda began investing heavily in the Indian Pharma manufacturing base in the Himachal Pradesh-Chandigarh-Haryana-Uttarakhand corridor and the Hyderabad-Pune corridor.

unmole 3y ago
Yeah, no. If what you said was true, The Serum Institute of India wouldn't have licensed the Oxford-AZ vaccine. Same applies for drugs like Molnupiravir where local manufacturers licenced the drug from Merck. Even if these manufacturers were able to get away with patent violations, they still wouldn't be able to export them to the biggest and richest markets.
- alephnerd 3y ago
  The COVID vaccine was a bad example as it was manufacted on license from AstraZeneca, but the larger Indian market absolutely does this due to how the Indian Patent Act is structured. "Section 3(d) of the Patents Act, 1970, explains that a new form of a known substance, new property / new use for a known substance and the mere use of a known process are not patentable and is not considered distinct from the known substance. Based on this principle, inventions using known substances are not patentable unless, for example, the alleged invention displays a significant increase in efficacy." [0] Ranbaxy, Reddy Labs, and Sun Pharma all started thanks to this loophole, and it has been a massive blocker in any US-India Free Trade Agreement. This is all open knowledge to all players in the India market [1]. It's not necessarily a bad thing btw - it's a major reason India's Pharma and Agrochemical R&D pipeline punches above its weight, but it has an impact on US-India relations, but for other regions such as the EU, Japan, or Developing countries it doesn't have much of an impact. [0] https://www.aipla.org/list/innovate-articles/the-global-significance-of-india-s-pharmaceutical-patent-laws https://www.aipla.org/list/innovate-articles/the-global-sign... [1] https://www.nishithdesai.com/fileadmin/user_upload/pdfs/Patents_and_the_Indian_Pharmaceutical_Industry.pdf https://www.nishithdesai.com/fileadmin/user_upload/pdfs/Pate...
  - unmole 3y ago
    Sure, the fact that the patent regime in India doesn't allow evergreening is common knowledge. But that is not what your original comment said.