Bayer in India: Intellectual Property Expropriation?

Case Solution

Peter M. Bican, Quynh Nhu Truong
Ivey Publishing ()

The Bayer Group had to rethink its intellectual property strategies and focus on research and development. The Indian government had ruled against Bayer by granting a local generic drug maker a compulsory license that allowed it to sell a copy of Bayer’s successful cancer drug at a fraction of the original price. This lawsuit showed that pharmaceutical innovations in emerging markets cannot be effectively protected by conventional intellectual property rights. This questioned the core of the pharmaceutical industry business model: If ideas and inventions could not be protected, was there an incentive for companies to innovate? Would this victory for the generic drugmaker trigger similar decisions elsewhere? Do prevailing patent-centric intellectual property strategies need to be adapted to emerging markets? Or would innovative companies eventually have to withdraw from markets with weak intellectual property protection?

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