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Success in Pharmaceutical Research: The Changing Role of Scale and Scope Economies, Spillovers and Competition

Author

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  • Tatiana Plotnikova

    (DFG Research Training Program "The Economics of Innovative Change", Friedrich-Schiller-University Jena, Germany)

Abstract

This paper investigates the determinants of success in the development of new drugs. In specific, it explores the factors of success in drug development programs at different stages of innovation process. We use economies of scale, scope, R&D competition and technological spillovers as explanatory variables and test whether the effect of these variables on the success of a project differs in relation to the discovery and development stages of innovation, respectively. Our main finding is that spillovers, including spillovers from collaboration, are important in explaining the success of projects during the discovery stage of innovation, while in the later development stage, the effects of competition outweigh any benefits from spillovers.

Suggested Citation

  • Tatiana Plotnikova, 2010. "Success in Pharmaceutical Research: The Changing Role of Scale and Scope Economies, Spillovers and Competition," Jena Economics Research Papers 2010-045, Friedrich-Schiller-University Jena.
    • Handle: RePEc:jrp:jrpwrp:2010-045
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    File URL: https://oweb.b67.uni-jena.de/Papers/jerp2010/wp_2010_045.pdf
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    References listed on IDEAS

    as
    1. David J. Teece, 2003. "Competition, Cooperation, and Innovation Organizational Arrangements for Regimes of Rapid Technological Progress," World Scientific Book Chapters, in: Essays In Technology Management And Policy Selected Papers of David J Teece, chapter 16, pages 447-474, World Scientific Publishing Co. Pte. Ltd..
    2. Kenneth E. Knight, 1967. "A Descriptive Model of the Intra-Firm Innovation Process," The Journal of Business, University of Chicago Press, vol. 40, pages 478-478.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Burak Dindaroglu, 2011. "R&D Productivity and Firm Size in Semiconductors and Pharmaceuticals: Evidence from Citation Yields," Working Papers 1101, Izmir University of Economics.
    2. Thomas Bolli & Martin Woerter, 2013. "Technological Diversification and Innovation Performance," KOF Working papers 13-336, KOF Swiss Economic Institute, ETH Zurich.
    3. Massimo Florio & Chiara Pancotti, 2022. "European pharmaceutical research and development. Could a public infrastructure overcome market failures?," Working Papers 202202, CSIL Centre for Industrial Studies.

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    More about this item

    Keywords

    economies of scale and scope; spillovers; competition; R&D; innovation process;
    All these keywords.

    JEL classification:

    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology; Plastics

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