Sunday, Sep 21, 2014

Innovation that includes

A quick perusal of the informal economy demonstrates that creativity is not the preserve of the rich.
Written by Shamnad Basheer | Posted: April 26, 2014 12:20 am

The pharmaceutical industry needs to shed its archaic blockbuster model.

A number of years ago, I was keen on starting an intellectual property (IP) and innovation institute. As I was thinking through prospective names for it, I came across a wonderful sentiment from one of India’s leading scientists, R.A. Mashelkar, that innovation is really a journey from Saraswati (the goddess of knowledge) to Lakshmi (the goddess of wealth). This struck a chord with me and I coined the name “Sarakshmi” — from Saraswati to Lakshmi.

When I suggested this to my then supervisor, David Vaver, he exclaimed that generating wealth is great, but who gets it? Will it be concentrated? What about distributional concerns? I brushed these questions off, stating that wealth has to be created before it can be distributed.

But when I thought about it further, I wondered, does this necessarily have to be a sequential process or can we foster a model where growth is inclusive and embraces distributional concerns within its main architecture?

The term “inclusive growth” attempts to capture this sentiment. In much the same vein, we now have the concept of “inclusive innovation”.

At base, the notion of “inclusiveness” has two key aspects to it. First, the fruits of innovation must be accessible to the public at large and not confined to a privileged few. Particularly in the case of drugs, which are often priced out of the reach of the average consumer —  consider Nexavar, a patented kidney cancer drug that sold for Rs 3 lakh for a month’s dosage. Fortunately, the Indian patent office granted a licence to ensure that a more affordable version, priced at Rs 8,800 a month, was manufactured by an Indian generics company.

Indeed, the very process of creating affordable versions of existing products could be “innovative”. Consider, for example, Triomune, Cipla’s pioneering $1-a-day medication, formed by creatively combining three different anti-HIV drugs. Until then, patients had had to pay $ 10,000 a year, buying the medicines separately from three different pharma companies. Yet, Cipla is constantly painted as a pirate in global IP debates, a company that simply copies and rips others off.

What is the point of innovation if the benefits exclude a large percentage of the populace? India’s patent regime, under fire from angry multinationals and governments, is premised precisely on this —  innovations bestowed with a state-sanctioned monopoly (through a 20-year patent term) must be worked for public benefit.

Second, our innovation architecture ought to be democratic and open to all who wish to participate. Unfortunately, our current framework focuses almost entirely on the formal sector. And yet, a quick perusal of the informal economy demonstrates that creativity is not the preserve of the rich. Consider C. Mallesham, a school dropout from Pochampalli who invented an ingenious weaving machine after seeing his mother break her back weaving manually for hours on end. Mallesham demonstrated continued…

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