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Bokhari2021_Article_InnovationAndGrowthInTheUKPhar.pdf (2.38 MB)

Innovation and growth in the UK pharmaceuticals: the case of product and marketing introductions

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posted on 2020-01-13, 10:09 authored by Farasat Bokhari, Franco Mariuzzo, Anna Rita BennatoAnna Rita Bennato
New drug introductions are a key to growth for pharmaceutical firms. However not all innovations are the same and they may have differential effects that vary by firm size. We use quarterly sales data on UK pharmaceuticals in a dynamic panel model to estimate the impact of product (new drugs) and marketing (additional pack varieties) innovations within a therapeutic class on a firm’s business unit growth. We find that product innovations lead to substantial growth in both the short and long run, whereas a new pack variety only produces short-term effects. The strategies are substitutes but the marginal effects are larger for product innovations relative to additional packs, and the effects are larger for smaller business units. Nonetheless, pack introductions offer a viable short-term growth strategy, especially for small and medium sized businesses.

History

School

  • Business and Economics

Department

  • Economics

Published in

Small Business Economics

Volume

57

Issue

1

Pages

603-634

Publisher

Springer Verlag

Version

  • VoR (Version of Record)

Rights holder

© The Authors

Publisher statement

This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/.

Acceptance date

2019-11-27

Publication date

2020-04-21

Copyright date

2020

ISSN

0921-898X

eISSN

1573-0913

Language

  • en

Depositor

Dr Anna Rita Bennato. Deposit date: 10 January 2020

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