11. Mergers and alliances in pharmaceuticals: effects on innovation and R&D productivity
نویسندگان
چکیده
The pharmaceutical industry provides a good laboratory to investigate the effects of mergers and alliances on innovation and R&D productivity. Over the past few decades, the industry has been characterized both by significant consolidation of large pharma firms as well as the vertical disintegration of the R&D process. The latter is associated with significant entry into the discovery and development process by early stage biopharmaceutical firms. Since the early 1990s, an evolving marketplace for new technologies through licensing agreements and joint ventures has emerged, accompanied by the growth of contract research organizations that specialize in implementing clinical trials for new drug candidates. To put some of these changes in historical perspective, it is useful to chronicle some of the key dynamic forces affecting the pharmaceutical industry since the early 1980s. While the 1980s were a period of rising prices and profits for the industry, many challenging developments also occurred for the vertically integrated, multinational drug industry. These developments included rising R&D costs (DiMasi et al., 1991; 2003), the expiration of patents on major commercial products, and the beginning of intensive price competition from generics. The passage of the Waxman–Hatch Act in 1984 was a key legislative change that allowed generics to enter the market by demonstrating bioequivalence (that is without the need to do clinical tests of safety and efficacy) (Grabowski, 2007). These dynamic forces intensified in the 1990s with the rise of buyer-side market power in the form of managed care organizations and pharmacy benefit managers in the US, and increasingly stringent price controls in other major world markets. Market and political pressures have caused declining growth in sales and profits that have been particularly evident on an industry-wide basis since the mid-1990s.
منابع مشابه
Determinant Factors of Absorptive Capacity and Innovation in Iranian Industry’s firms (Focus on Firm Size, Labor Productivity and Value of Production)
The successful economies are ones that have effective system to transform knowledge and technology in economic capacity. They have complex system that is an important sector of their economy. The current approach moving to knowledge based society is attention to R&D activities and high technologies. In this path, industrial companies can have a vital role in creating, developing and applying of...
متن کاملCollaboration and innovation: a review of the effects of mergers, acquisitions and alliances on innovation
متن کامل
برآورد تاثیر توسعه فناوری بر بهره وری کلی عوامل در ایران
The concept of “Innovation” has changed considerably in recent years. According to new theories, the innovation emerges in a system of interrelated elements and determinants during which the idea changes to a commercialized output or process. The literature on the innovation has concentrated mainly on various aspects of innovation chain separately. In this paper we tried to investigate the gene...
متن کاملResearch and Development Investment and Productivity Growth in Firms with Different Levels of Technology
I n the modern competitive world, Research and Development (R&D) and its overflowing technologies are the main basis of innovation, which in turn, can be determined as an important source of economic growth. Investing in research activities can help firms with different technological levels, especially high-tech industries to improve their productivity. This paper aims to analyze the...
متن کاملThe Analysis of the Effects of Domestic and Foreign Investment in R&D on Agricultural TFP in Iran
Nowadays, agricultural R&D provides new and developed technologies to create modern agricultural producing methods. During recent years, improving agricultural productivity is affected by not only domestic R&D investments but also foreign countries R&D investments. Nowadays, according to new growth models, R&D is the base of productivity. Recent economic theories consider agricultural research ...
متن کامل