China and India as Suppliers of Affordable Medicines to Developing Countries

41 Pages Posted: 29 Jul 2011 Last revised: 20 Aug 2021

See all articles by Tamara Hafner

Tamara Hafner

Syracuse University - Maxwell School of Citizenship and Public Affairs

David Popp

Syracuse University - Department of Public Administration; National Bureau of Economic Research (NBER)

Date Written: July 2011

Abstract

As countries reform their patent laws to be in compliance with the Trade Related Intellectual Property Rights Agreement, an important question is how increased patent protection will affect drug prices in low-income countries. Using pharmaceutical trade data from 1996 to 2005, we examine the role of China and India as suppliers of medicines to other middle- and low-income countries and evaluate the competitive effect of medicine imports from these countries on the price of medicines from high- income countries. We find that imports of antibiotics and unspecified medicaments from India and China significantly depress the average price of these commodities imported from high-income trading partners, suggesting that India and China are not only important sources of inexpensive medicines but also have an indirect effect by lowering prices through competition. As India is the leading supplier of medicines in Sub-Saharan Africa, this region will likely be affected most adversely.

Suggested Citation

Hafner, Tamara and Popp, David C., China and India as Suppliers of Affordable Medicines to Developing Countries (July 2011). NBER Working Paper No. w17249, Available at SSRN: https://ssrn.com/abstract=1898505

Tamara Hafner (Contact Author)

Syracuse University - Maxwell School of Citizenship and Public Affairs ( email )

400 Eggers Hall
Syracuse, NY 13244
United States

David C. Popp

Syracuse University - Department of Public Administration ( email )

Syracuse, NY
United States
315-443-2482 (Phone)
315-443-1075 (Fax)

HOME PAGE: http://faculty.maxwell.syr.edu/dcpopp/index.html

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