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Licensing Life-Saving Drugs for Developing Countries: Evidence from the Medicines Patent Pool

Author

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  • Alberto Galasso
  • Mark Schankerman

Abstract

We study the effects of an institution that pools patents across geographical markets on the licensing and adoption of life-saving drugs in low- and middle-income countries. Using data on licensing and sales for HIV, hepatitis C and tuberculosis drugs, we show that there is an immediate and large increase in licensing by generic firms when a patent is included in the Medicines Patent Pool (MPP). The effect is heterogeneous across countries. The findings are robust to identification strategies to deal with endogeneity of MPP patents and countries. The impact on actual entry and sales, however, is much smaller than on licensing, which is due to geographic bundling of licenses by the MPP. More broadly, the paper highlights the potential of pools in promoting technology diffusion in developing countries.

Suggested Citation

  • Alberto Galasso & Mark Schankerman, 2021. "Licensing Life-Saving Drugs for Developing Countries: Evidence from the Medicines Patent Pool," NBER Working Papers 28545, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:28545
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    Cited by:

    1. Silvia Balia & Sara Pau & Silvana Robone, 2021. "Intellectual property rights protection and health: the case of tuberculosis," RIEDS - Rivista Italiana di Economia, Demografia e Statistica - The Italian Journal of Economic, Demographic and Statistical Studies, SIEDS Societa' Italiana di Economia Demografia e Statistica, vol. 75(3), pages 149-160, July-Sept.
    2. Shiri Mermelstein & Hilde Stevens, 2022. "TRIPS to Where? A Narrative Review of the Empirical Literature on Intellectual Property Licensing Models to Promote Global Diffusion of Essential Medicines," ULB Institutional Repository 2013/337220, ULB -- Universite Libre de Bruxelles.
    3. Sieds, 2021. "Complete Volume LXXV n. 3 2021," RIEDS - Rivista Italiana di Economia, Demografia e Statistica - The Italian Journal of Economic, Demographic and Statistical Studies, SIEDS Societa' Italiana di Economia Demografia e Statistica, vol. 75(3), pages 1-194, July-Sept.
    4. Wang, Lucy Xiaolu, 2022. "Global drug diffusion and innovation with the medicines patent pool," Journal of Health Economics, Elsevier, vol. 85(C).

    More about this item

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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