The report from Consumers International (CI) says that self-regulation by the multinational drug giants has failed, citing drug adverts by companies such as Glaxo-SmithKline, Wyeth, Novartis and Pfizer that would be considered misleading in Europe, as well as the heavy promotion by all companies of products to doctors.

The impact on patients is serious, the report says. "Up to 50% of medicines in developing countries are inappropriately prescribed, dispensed or sold," it says.

Drug company gifts to doctors include air conditioners, laptops, club membership, domestic cattle, foreign conferences at five-star hotels, brand new cars and school tuition fees, the report says. In the UK only gifts of minimal value, such as pens and mouse mats, are allowed.

But Murad M Khan, professor and chairman of the department of psychiatry at Aga Khan University, told researchers that in Pakistan "for writing 200 prescriptions of the company's high priced drug, a doctor is rewarded with the down payment of a brand new car".

CI's member organisation in Pakistan, TheNetwork, surveyed doctors, sales reps and medical store personnel.

An unnamed Indian doctor told researchers: "'Gifting' of air conditioners, washing machines, microwaves, cameras, televisions, and expensive crystals is an accepted norm nowadays. So are frequent pampering in the form of CMEs [continuing medical education meetings] and lectures in star hotels followed by lavish dinners and cocktails." Similar reports came from Venezuela, Indonesia and Malaysia.

Richard Lloyd, director general of CI, a London-based federation of consumer groups from 113 countries, called for a ban on all gifts to doctors. "The pharma industry sees the developing world as a trillion-dollar opportunity to secure profits over the next 40 years. Weak regulation makes these markets an easy target for the marketing techniques of multinational drug companies, but consumer health expenditure in these countries can ill afford to be squandered on irrational drug use."

The report is also critical of drug advertisements in developing countries which, it claims, sometimes promote a drug without mentioning the side effects or the restrictions on its use - for instance that it works in women but not men.

Regulatory authorities in developing countries are slow to protect people from drugs that have been banned or withdrawn in other countries. Vioxx for arthritis was officially banned in India in October 2004, the month after manufacturers Merck withdrew it in the US, but it was still on sale in India the following year.

The International Federation of Pharmaceutical Manufacturers Associations (IFPMA), the global trade body, said it would take time to get its code of conduct adopted everywhere. "I think it is not something that is achievable overnight," said spokesman Guy Willis. "The issue is how do we get there."

But he called on CI to lodge complaints where it had evidence of any breach of the IFPMA's code of practice.