International drug companies will begin conducting drug R&D in India next year. Up until now, Big Pharma had shied away from doing drug design and preclinical testing there. But in accordance with an agreement with the World Trade Organization, from next year India will honour overseas drug patents. This gives drug companies the protection they need to do drug research and conduct clinical trials without too much fear of being robbed by drug pirates. The change in intellectual property law will also build up India's expertise in conducting clinical trials, which has not developed because its patent laws did not require them.

The change means that foreign business is flooding in. Mumbai-based SIRO Clinpharm, which conducts clinical trials, says that its business has grown 60 to 80% each year, with 90% coming from overseas. The attraction is the prospect of saving money. Clinical trials cost as little as 40% as those done in Western countries. They are also far easier to organise. SIRO Clinpharm says that it was able to recruit 750 patients to test a drug for head and neck cancer in five hospitals in just 18 months. In Europe, it took twice the time to find a mere 100 patients in 22 hospitals.