• There is limited argument or empirical evidence that government need be directly involved in the production of pharmaceuticals.

• Countries with state-owned pharmaceutical manufacturing firms often face difficult questions about how to ensure the efficiency of these firms. In noncompetitive markets, privatization (divestment) may not be the best strategy. Governments need to explore a range of different options such as stimulating competing manufacturers and contracting-out management functions.

• Governments can play a key role in encouraging the development of manufacturing capacity in the local private sector. The most effective way of doing this is probably to encourage the development of a stable economic and political environment, an efficient regulatory environment, and favourable tax and duty structures.