Drug Procurement, R&D Models, and Innovation Performance of Pharmaceutical Companies
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https://doi.org/10.54097/h0ye7k84Keywords:
Centralized Drug Procurement, Pharmaceutical Companies, R&D Model.Abstract
Under the multi-objective public policy of national centralized banded purchasing of medicines (“Drug Procurement”), winning pharmaceutical companies are faced with the dual dilemma of declining product profits and high investment in innovation. Although the centralized drug procurement policy significantly reduces drug prices and alleviates the burden of patients, the mechanism of its impact on the innovation performance of pharmaceutical companies is still unclear, and an in-depth study of this mechanism can help to comprehensively understand the effect of the implementation of the centralized drug procurement policy. By constructing a multi-period double-difference model to investigate the impact of the drug collection policy on the innovation activities of enterprises, the study finds that the drug collection policy significantly improves the innovation performance of selected enterprises through two paths, namely internal R&D and external cooperation. Heterogeneity analysis shows that the drug collection policy significantly enhances the innovation performance of larger enterprises and pharmaceutical enterprises whose leading products are chemicals, and has a more significant positive effect on the innovation performance of state-owned enterprises compared with that of non-state-owned enterprises. On the basis of empirical analysis, suggestions are made for policy improvement.
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