At the first half of the 20th century, Brazil has a strong pharmaceutical industry which was based in biological products. However the technological shift and other institutional factors have changed drastically its trajectory. So, this paper analyzes some evidences in order to comprehend why the scientific and technological activities – characteristics of the sector at a global level – were eliminated from the routine of local industry. Brazilian legislation did not recognize pharmaceutical patents for products and processes up until 1996, an exemption which started in 1945 for products and 1969, for processes. During that period, domestic companies freely reproduced medicines developed by large companies from abroad and commercialized them in the local market with their own trademarks. They applied considerable efforts and resources into commercial assets, aiming to consolidate their brands with the medical class, but they did not have to face the costs of research and development (R&D). This strategy guaranteed considerable profitability for the domestic laboratories, but it became impracticable with the new institutional landmark that emerged after the regulation of the Patents Law (“Lei de Propriedade Intelectual” – number 9.279 of 05/14/1996) and the Generic Medicines Law (“Lei do Medicamento Genérico” – number 9.787 of 02/10/1999). Based on interviews, on a Panel of Specialists and on secondary sources, this article analyze how the new competitive environment has forced companies to adopt new strategic positions, in which innovation gained importance, even though there are elements of organizational inertia because they are impregnated by patterns of behavior inherited from the past. In here it is emphasized the importance of path-dependence in the positioning of the new business environment that has emerged recently, linking experience, training techniques and technology strategy of firms.