Bilateral research cooperation between Sweden (Sida/SAREC) and Uganda has supported major advances in institutional research capacity strengthening at Makerere University (2000-2013). This case study illustrates how a department within Makerere's Faculty of Medicine (Department of Pharmacy and Therapeutics) has contributed to transforming the post-graduate educational process with formation of a productive research team comprised of faculty and students to advance a research agenda targeting strategic priorities of national significance. We explain the evolution of research as an element of national development and development assistance plus the evolution of doctoral studies and strategic research worldwide, in Africa, and at Uganda's oldest national university, Makerere, where Sweden has contributed the largest amount of external funding 2000-2012. We conclude with lessons and recommendations about Ph.D. programme start up, recruitment, supervision, international collaboration, and research infrastructure and environment for building institutional research capacity.