Local government policies and pharmaceutical clusters in China

Understanding the determinants of online pharmacy adoption: a two-staged SEM-neural network analysis approach

Purpose

This study aims to understand the determinants of online pharmacy or epharmacy adoption among young consumers in Bangladesh using an extended unified theory of acceptance and use of technology (UTAUT) model.

Design/methodology/approach

A structured Google Docs questionnaire was sent out to 420 respondents using messenger service; 285 useable responses were finally extracted. Data were empirically validated using the two-staged structural equation model (SEM)-neural network analysis approach.

Findings

The robustness of the classical UTAUT model remains intact in the context of online pharmacy adoption. Among the integrated variables, while perceived trust and health literacy were found significant, perceived risk and personal innovativeness were found insignificant in determining consumers’ intention to adopt online pharmacy. The neural network analysis provided further verification of these findings derived from the SEM.

Practical implications

The findings of this study would facilitate in devising better strategies for entering or expanding online pharmacy business in developing countries such as Bangladesh.

Originality/value

The originality of the current study relates to the two-fold contributions of this study. First, while this study extended the classical UTAUT model by incorporating perceived risk, perceived trust, personal innovativeness and health literacy, the inclusion of the following two variables is fresh within the extant online pharmacy literature. Second, by using a two-staged SEM-neural network analysis approach, this study advances the past studies on e-commerce adoption in pharmaceutical settings and provides a general understanding of the customers of developing countries.

Recent developments in China’s biopharmaceutical industry (2012-2017)

Purpose

The paper aims to take stock of China’s recent biopharmaceutical industry development by analyzing product innovation and changes in the firms’ product portfolios during the five-year period between 2012 and 2017.

Design/methodology/approach

The paper introduces a classification of biopharmaceutical products. By applying the classification to the product data of China’s drug regulator, the CFDA, it becomes possible to trace the developments within the sector by looking at changes in the number of firms within each subgroup and changes in the number of subgroups in which each firm is involved. The classification allows an evaluation of the latest product innovation achievements.

Findings

The paper demonstrates a mild shakeout of firms in the relatively long-existing domestic market segments, a trend toward more specialized product portfolios and an enduring prevalence of innovation strategies aimed at exploiting relatively unpopulated domestic market niches instead of pioneering entirely new products. Especially the capability of upgrading to second-generation protein therapeutics has become a key criterion for separating the wheat and the chaff in China’s domestic sector. The paper moreover points out the relevance of acquisitions as a corporate growth strategy.

Research limitations/implications

The research does not consider complementary indicators, product pipelines in particular. Future research should compare patterns across emerging economies.

Originality/value

The paper is unique in using the CFDA database for systematic academic research on (bio)pharmaceutical innovation and in introducing a biopharmaceutical product classification to trace innovative activities and changes in corporate product portfolios over time.

Determinants of FDI Localization in China: A County-Level Analysis for the Pharmaceutical Industry

Foreign direct investments (FDIs) have been widely recognized as a crucial feature of the Chinese industrial development process. Over the past decades, China has been attracting huge amounts of inward FDIs as a consequence of both spontaneous market dynamics and place-based preferential policies at the sub-national level. However, the Chinese market exhibits large dissimilarities in terms of FDI localization across territories that are worth investigating at a more disaggregated level. In this regards, our study explores the determinants of attraction of inward FDIs in China, at the county level. It focuses on the pharmaceutical industry and attempts to assess whether factors related to location advantages, agglomeration dynamics, information cost effects and environmental regulation costs affect foreign firms’ localization choices as well as invested amounts in that location. By means of discrete choice models, our paper confirms the findings of the prevalent literature about the positive effects of location advantages on pharmaceutical FDI attraction. Different from our expectations, a higher proportion of foreign enterprises do not stimulate significant effects on FDI localization, while preferential policies and sectoral agglomeration are positively correlated with the localization of pharmaceutical foreign firms. Finally, our results suggest that investing firms tend to avoid areas with strict environment regulation.

Managing the challenges of pharmaceutical patent expiry: a case study of Lipitor

Purpose

The paper aims to study how global pharmaceutical companies such as Pfizer have managed the challenges of pharmaceutical patent expiry.

Design/methodology/approach

A case study method was applied. The best-selling brand drug over the past 10 years – Lipitor – was chosen as the case target.

Findings

For dealing with this, this paper describes all the details of the corresponding strategies of Pfizer before and after patent expiration of Lipitor. Before patent expiry, Pfizer undertook the activities of direct-to-consumer marketing, pricing strategy for competition, legal delay and me-too drug R&D. After patent expiry, Pfizer chose to carry out continuous marketing for brand, rebate strategy, authorized generics and change to over-the-counter. In addition, diversity and globalization strategy was applied before and after patent expiry.

Research limitations/implications

This research provides strong implication for managing pharmaceutical products before and after patent expiry.

Practical implications

It is strongly recommended for both brand and generic drug companies to design strategies to meet the challenges of pharmaceutical patent expiry.

Social implications

For the global pharmaceutical market, a conclusion can be drawn that, nowadays, the “patent cliff” is the most significant factor influencing decision-makers to consider futuristic policies. Further, it is also a considerably effective solution for reducing health-care costs for policymakers.

Originality/value

This paper contributes to the field of patent expiry management in high-tech industries such as pharmaceuticals.

Strategic issues in pharmaceutical supply chains: a review

Purpose

In the present context of a health-concious society, management of pharmaceutical supply chains has become more complex because it involves the life-saving interest of human being and requires the participation of different stakeholders such as pharmaceutical manufacturers, wholesalers, distributors, customers, information service providers and regulatory agencies. Limited research is available in the area of pharmaceutical supply chains. This paper aims to find the gaps in the literature by reviewing research papers on different strategic issues of supply chain management in the pharmaceutical sector.

Design/methodology/approach

In total, 136 research papers, mainly from refereed international journals, were reviewed to identify the issues of supply chain management (SCM) in the pharmaceutical supply chain. On the basis of a review, gaps are identified and research agenda is proposed.

Findings

It is observed from review that the pharmaceutical sector is not widely researched in developing countries because of many complexities in this supply chain. The share of pharmaceutical firms in the global market is also not very significant. Based on an extensive review of pharmaceutical supply chains, research gaps are identified in different areas such as inventory management, new product development, process development, capacity planning, network design, plant design, pipeline and development management, outsourcing logistics activities, reverse logistics, Lean manufacturing, green SCM and implementation of E-business processes and performance management. These strategic issues have been further classified into three broad categories, i.e. resources, processes and performance.

Originality/value

This paper explores major strategic areas of pharmaceutical supply chains for research. Findings of the paper will be highly useful for researchers to decide direction of future research.

Assessment of knowledge economy

Purpose

– The purpose of this paper is to describe the current status of the knowledge-based economy (KBE) in Iran in comparison to Turkey, the challenges encountered and the appropriate policies toward Iran’s Outlook 2025 based on which the country is expected to be ranked first in science and technology within the Middle East region.

Design/methodology/approach

– This study is a descriptive research. The methodology used for this study is qualitative/quantitative secondary research. The method will be used for two main goals. First, we used the World Bank’s Knowledge Assessment Methodology, and the data are mostly collected from secondary sources such as the World Bank’s Development Indicators for Iran and Turkey. Second, desktop research will be used to summarize and synthesize available studies on the consideration of policy-making toward KBE, especially among developing economies.

Findings

– The paper provides policy considerations around four pillars: information and communications technology (ICT), innovation system, education and human resources development and economic incentives and institutional regime. It suggests that regarding ICT indicators, Iran has to join international programs to attract senior public authorities’ involvement and accountability. Regarding its innovation system, lessons for policymakers are implementing development plans and coordinating science and technology policies in the country. Moreover, the quality of education, in-company training, post-secondary technical education and scientific and technological workforce need to be improved. Finally, considering the weak macroeconomic circumstances, legislative measures are needed in addition to, establishing a promotion agency for foreign direct investment to coordinate the inflow and to grant incentives for attracting more investment.

Research limitations/implications

– Because of the chosen research approach, the research results have not been confirmed by an experts group. Therefore, using some group decision-making methods, such as panel of experts, could be proposed to further test the findings.

Practical implications

– The paper includes implications for public policymakers, especially in developing countries, and for moving toward a KBE.

Originality/value

– This paper fulfills an identified need to learn from similar countries experiences in policymaking about the same problem.