How the Innovation Take Place in Pharmaceutical Industry?: An Empirical Investigation from Thailand

Abstract

In pharma industry, innovation is claimed as key source for the competitive edge over the rivals in the market. However, in the drug market, innovation has not got enough attention from the literature both in theoretical and empirical perspective. Therefore, we have examined the innovative practices through five dimensions by the pharma sector of Thailand while selecting a set of factors under the title of firm position, structure, and characteristics, and strategic orientation as key determinants. For the analysis purpose, initially, data was collected from the targeted respondents of pharma industry with the help of questionnaire which also contained some demographic items too. A sample of 372 respondents was collected over a time span of 5 months from different local areas of Thailand. Our results have reflected the fact that there is a significant and positive influence on product innovation by PFD, OS, DECEN, RD and OS. For process innovation, positive impact is found from PFD, OS, RD, SPE, and SGDC. Additionally, service innovation is also positively influenced by the PFD, MC, DECEN, and RD. on the other hand, Revolutionary innovation and Incremental innovation, there is a significant and positive influence from PFS, MC, SPE, SGDC and economy of scale. our results have provided a meaningful practice insight which can further help the management in pharma industry. More specifically, a range of factors are discussed with their direct impact on the innovative practices which may increase the practical knowledge of the investors, owners and other parties in the local market of Thailand.