Mncs And Drug Patents On India - 1903 Words

MNCs and Drug Patents in India Word count: 1638 Once upon a time, breaking the patent law saved a country and it’s people, and enabled its economy to grow exponentially. In 1972, India changed its patent laws, started producing drugs that were patented, and significantly improved it’s economy by driving out the multinational pharmaceutical companies that had created a monopoly in the pharmaceutical industry. In economics, monopoly refers to a â€Å"situation in which a single company or group owns all or nearly all of the market for a given type of product or service. By definition, monopoly is characterized by an absence of competition, which often results in high prices and inferior products,† according to Investopedia.com. (5) In short,†¦show more content†¦When there is a monopoly, though it depends on what the circumstances are, the demands for the good or the service tends to be highly inelastic. This is because there are none or not many substitute goods. As a result, the firm does not have to change the supplies in respect to the change in demand, they can charge the consumers as much as they want to, and will not have incentives to improve their product or service. Rather than improving the product or service, the firms will try to get rid off possible competitions before they become a threat. The question is: is monopoly good? We will investigate by looking at h istory of patents in the field of pharmaceuticals in India. One example of monopolies caused by patents or copyrights is multinational companies, or MNCs, in the field of pharmaceuticals. Multinational pharmaceutical corporations produce many, if not most, of the popular drugs. For example, Pfizer, a multinational pharmaceutical corporation based in New York, has patents for many of the best-selling drugs, causing monopoly. Some of the drugs include, but are not limited to, Lipitor, Lyrics, Viagra, and Zithromax. (8) Thanks to the patents, these drugs, among with all the other drugs Pfizer produces and sells bring in annual revenue of over 50 billion dollars. (7) MNCs like Pfizer have a lot of advantage in the pharmaceuticals