Neurosurgeon Aftab Ahmed Qureshi was kidnapped from Karachi on May 12.
Police launched an operation in Hyderabad this morning to free Qureshi, triggering an exchange of fire between policemen and the kidnappers.
Besides the doctor, Assistant Sub-Inspector Kashif Khan and suspected kidnapper Muhammad Akhtar were killed, officials said.
Police arrested a woman and her son. They were living in the same bungalow where the kidnappers had held the doctor. They were identified as Kamla Kumar and Ashok Kumar.
Qureshi was a renowned surgeon of Karachi and his abduction sparked a spate of protests by doctors and members of the Pakistan Medical Association and organisations of doctors, nurses and paramedics.