The chief executive of Novartis has said that plans to invest in India will be shifted to China and elsewhere but claims that the move is not a punishment following the Swiss firm’s recent defeat in an Indian court over patent laws.

Earlier this month, Novartis lost its challenge to the constitutionality of a section of India's patent laws, a move brought on by the country's patent office’s decision to decline coverage for a new version of the leukaemia drug Glivec/Gleevec (imatinib). Once the judgement was announced, the Swiss firm said that it would discourage “investments in innovation”, and comments made by chief executive Daniel Vasella to the Financial Times show that Novartis is well and truly discouraged.

Dr Vasella said that the ruling “is not an invitation to invest in Indian R&D, which we would have done. We will invest more in countries where we have protection”. However he added that “it's not a punishment, it's just a question of the culture for investment. Do you buy a house if you know people will break in and sleep in your bedroom?" Dr Vasella also told the FT he had no plans for a new appeal against the latest Indian court ruling, saying that it was a matter for the World Trade Organization.

Which types of investment Novartis had planned in India was not specified and China already plays a major part in its research activities. At the end of last year, the firm unveiled plans to build a $100 million R&D centre in Shanghai, its eighth and largest investment in the country.