Severe psychiatric disorders (schizophrenia, bipolar disorder and major depressive disorder) cause much morbidity and disability in developing countries. Most of the evidence on the efficacy and effectiveness of drug treatments for these disorders is based on trials conducted in Western countries. Cultural, biological and health system factors may profoundly influence the applicability of such evidence in developing countries. Attitudes towards, and concepts about, psychiatric disorders vary across cultures, and these may influence the acceptability of drug treatments. Genetic and environmental factors may lead to variations in the pharmacodynamics and pharmacokinetics of psychotropic drugs across ethnic groups. This may explain why lower doses of psychotropic drugs tend to be used for non-Caucasian patients. There is a dearth of mental health professionals and care facilities in developing countries, especially in rural areas. Epidemiological studies show that, despite this lack of services, the outcome of schizophrenia is favourable in developing countries. This suggests that cultural, genetic or environmental factors may play as much of a role in influencing outcome as access to antipsychotic treatment. Regional drug policies may influence the availability and cost of psychotropic drugs. In particular, the Indian experience, where drugs are manufactured by several local pharmaceutical firms, thus bringing their cost down, may represent a unique deregulated drug industry. However, the impending impact of the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement, with the strict enforcement of patent laws, will almost certainly lead to a rise in drug costs in the coming years. This may influence the choice and cost effectiveness of various drugs. The implications of these cross-cultural variations for policy and practice are the need to ensure a reliable supply of affordable psychotropic drugs in developing countries, trained healthcare professionals to use these drugs rationally, a concerted advocacy campaign to exclude drugs for severe psychiatric disorders from patent protection, and the development of psychosocial programmes to improve global outcomes.