The Problem of the Bargaining Rich: Compulsory Licensing in Developing Markets

14 Pages Posted: 2 Feb 2016

See all articles by Feroz Ali

Feroz Ali

National Law School of India University

Date Written: February 1, 2016

Abstract

This article looks at why pharmaceutical companies do not practice price differentiation in the developing markets and identifies as a reason, apart from the issues of parallel import and reference pricing, the problem of the bargaining rich — the free rider who will not offer the full price of the drug if the drug is differentially priced. The author argues that the grant of compulsory license could potentially address these issues by segregating the market, both domestically and internationally.

Keywords: bargaining rich, compulsory licensing, developing markets, Nexavar licence, India's patent regime, Sorafenib Tosylate, differential pricing, free rider problem, market failure

JEL Classification: O31, 034

Suggested Citation

Ali, Feroz, The Problem of the Bargaining Rich: Compulsory Licensing in Developing Markets (February 1, 2016). Available at SSRN: https://ssrn.com/abstract=2725840 or http://dx.doi.org/10.2139/ssrn.2725840

Feroz Ali (Contact Author)

National Law School of India University ( email )

Nagarbhavi, PO Box 72
Bangalore, Karnataka 560072
India

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