Patents, R&D Expenditure, Regulatory Filings and Exports in Indian Pharmaceutical Industry

The impact of R&D expenditure, regulatory filings and patents granted on exports from Indian Pharmaceutical Industry has been studied. Pair wise Granger causality test between total patents granted and pharmaceutical exports suggests that total patents granted Granger causes pharmaceutical exports. Also, it was found that the R&D expenditure Granger causes regulatory filings like ANDAs and DMFs with a lag of one year. The relationship amongst variables namely pharmaceutical exports (as dependent variable) and regulatory filings and total patents granted (as independent variables) was analyzed using Autoregressive Distributed Lag (ARDL) Model. The ARDL model is suggestive of strong positive relationship amongst regulatory filings and pharmaceutical exports at one year lag. Also, there exists positive relationship between total patents granted and pharmaceutical exports. However, the impact of regulatory filings on exports is stronger as compared to that of total patents granted. It was found that in Indian Pharmaceutical Industry, regulatory filings have a major role in exports and the impact of patents granted is relatively small owing to the fact that Indian pharmaceutical firms have so far commercialized very few patented pharmaceutical products in global market.