Reverse Innovation in the Indian Pharmaceutical Industry : Determinants and Implications

Corsi, Simone and Panicker, Vidya (2026) Reverse Innovation in the Indian Pharmaceutical Industry : Determinants and Implications. In: Successful Technology Clusters in the 21st Century : Unleashing Innovation across Startups, Corporates, and Governments. de Gruyter, pp. 41-56. ISBN 9783111630038 (In Press)

Abstract

In the recent decades, emerging market multinational corporations (EMNCs) have evolved as global innovators, marking a significant shift in the global economic landscape. The evolution of EMNCs as global innovators challenges the traditional assumptions that historically positioned AMNCs as the predominant or the sole sources of technological advancement in the world. This chapter examines the case of the Indian pharmaceutical industry, a major player in global vaccine production and pharmaceutical innovation, to explore how innovation from EMNCs result in “reverse innovation”, where innovations originate in emerging economies before being adopted in advanced markets. Specifically, the chapter investigates how corporate ownership structures influence reverse innovation in Indian pharmaceutical firms. Analysing 15,242 reverse innovations (measured in the form India-USA patent dyads) from 144 Indian pharmaceutical firms (2000–2021 time-period), this study finds that ownership by families and pressure-sensitive institutional investors (such as banks and financial institutions) positively affect reverse innovation outcomes for firms. These findings provide insights into the role of ownership in shaping international innovation strategies of emerging market firms and offer managerial and policy implications for firms and stakeholders navigating these shifting dynamics in global innovation.