Chinese Pharmaceutical Industry Research Articles

Allocation of control rights and cooperation efficiency in public-private partnerships: theory and evidence from the Chinese pharmaceutical industry

This article uses incomplete contract theory to study the allocation of control rights in public-private partnerships (PPPs) between pharmaceutical enterprises and nonprofit organizations; it also investigates how this allocation influences cooperation efficiency. We first develop a mathematic model for the allocation of control rights and its influence on cooperation efficiency, and then derive some basic hypotheses from the model. The results of an empirical test show that the allocation of control rights influences how enterprises invest in PPPs. A proper allocation provides incentives for firms to make fewer self-interested and more public-interested investments. Such an allocation also improves the cooperation efficiency of PPPs.

The Impact of Higher Standards in Patent Protection for Pharmaceutical Industries under the TRIPS Agreement – A Comparative Study of China and India

A comparative study is undertaken that explores Chinese and Indian pharmaceutical industries under different patent regimes. It is found that relative to India, which had implemented process patent protection until 2005, China with a product patent regime since 1993 suffers from both lower drug accessibility and availability (the latter is a missing parameter in the literature). Also, China lags behind in both lower R&D investment and patents filed by Chinese nationals. Based on these findings and associated legal interpretation, we conclude that higher patent protection in China generates negative impacts on the pharmaceutical industries. Thus, governments should utilise TRIPS flexibilities and other regimes such as price control to offset the anticompetitive effect in designing patent policies.

Reconfiguration of Pharmaceutical Logistics Operations in China: An Empirical Study

Abstract Logistics reconfiguration is an active practice in the Chinese pharmaceutical industry. However, the reconfiguration performances are not satisfactory. This article investigates logistics reconfiguration strategies and develops a logistics reconfiguration success framework by a three-stage multi-method research approach. Telephone interviews and qualitative case study research methodology are used to collect data. From case studies, nine key success factors are identified. These factors are further validated as being relevant by a group of senior managers from industry. Finally, managerial implications are drawn.

Reconfiguration of Pharmaceutical Logistics Operations in China: An Empirical Study

AbstractLogistics reconfiguration is an active practice in the Chinese pharmaceutical industry. However, the reconfiguration performances are not satisfactory. This article investigates logistics reconfiguration strategies and develops a logistics reconfiguration success framework by a three-stage multi-method research approach. Telephone interviews and qualitative case study research methodology are used to collect data. From case studies, nine key success factors are identified. These factors are further validated as being relevant by a group of senior managers from industry. Finally, managerial implications are drawn.

The Regulation and Approval of New Drugs in China

Chinese drug legislation, enacted in 1985, requires that new drugs be approved by the national drug regulatory authority before they can be marketed in China. Since enactment of this legislation, China has significantly improved its regulatory review process for new drugs. During the same time period, the pharmaceutical industry in China has shown considerable expansion. With China's membership in the World Trade Organization, the Chinese pharmaceutical industry is experiencing change and will continue to do so. The new Drug Registration Regulation, which is compatible with the World Trade Organization agreement, went into effect on December 1, 2002. This paper reviews China's new drug approval history, regulatory policy and administration, and related issues with respect to China's climate for pharmaceutical innovation and the Chinese pharmaceutical industry. We provide approval data for new chemical entities (NCEs) approved from 1985 through 2000, and draw a picture of China's NCE review policies and th...

Professional Code or Legal Sanctions: Pharmacy in China

This paper examines how norms are introduced and implemented in the production and trade of medicines in China, with some reference to similar cases in Australia. The aim is to analyse the role of the State in the supervision of the pharmaceutical industry in China. The professional responsibility of the apothecary whose wares can cure or destroy a patient has always been self-evident in any cultural environment. The question to be raised here is not so much what these responsibilities are in China but who defines them and how they are defined. The starting point for analysis is a set of materials concerned with the Chinese pharmaceutical industry. The materials consist of The People's Republic of China's Full Account of Administrative Practices in Regard to Pharmaceuticals (Zhonghua Renmin Gongheguo Yaopin Guanli Shiyong Quanshu), published in 1997, and similar administrative guidelines from the 1980s and 1990s. In China there are no guidelines for the pharmaceutical industry equivalent to those in Australia, which originate from within the industry.1 The origin and style of the Chinese materials will shape much of the following discussion. In China, administrative rules or laws must be seen as the main creator and guarantor of norms prevailing in the production and trade of pharmaceuticals. Thus, unlike Australia where the validity of a pharmacists' professional code reduces the need for legal sanctions, in China the definition of professional standards and the control over their implementation are exclusively a matter for legal sanctions. This feature of Chinese pharmaceutical practice results from the dominant role of the Chinese state; its strict monopoly in regard to social organisation and a certain institutional weakness that results from this are factors that necessarily curtail the self-determination of professional groups. So in this respect, despite the special issues involved in the production and sale of pharmaceuticals, pharmacists do not differ much in regard to their professional sovereignty or, rather, the lack of it from other professions. Consequently, in order to identify the Chinese understanding and formulation of professional ethics for pharmacists, we first need to look at the issue of the status of the pharmaceutical profession in China.

The determinants of foreign pharmaceutical firms’ FDI entry mode choices between joint venture and sole venture into China

SummaryThe popularity of foreign direct investment (FDI) activities in China also applies to the pharmaceutical industry. Foreign pharmaceutical firms invest their capital and technology in what is likely to be developed as the world’s largest pharmaceutical market in the future with the expectation they will earn an excellent return in a longer term. This study aims to investigate the determinant factors that affected foreign pharmaceutical firms’ decisions in choosing either a joint venture or sole venture entry mode into the Chinese pharmaceutical manufacturing industry. This research shows that the probability for establishing a joint venture in China is positively related to the importance of China’s investment environmental and market factors. A marginal significant positive relationship between sole venture entry mode and the importance of parent firm’s decision task related factors is found.

The Implications of WTO Accession on the Pharmaceutical Industry in China

Given the limited capabilities of R&D and global distribution channels, and the virtual non-existence of patented drugs, the Chinese pharmaceutical industry has little chance to enter the global market of Western prescription drugs and compete with the established global giants head-on. The reality is that they are chasing a moving target and their competitors are becoming bigger and stronger day by day. The substantial reduction of import tariffs and the granting of comprehensive trading and distribution rights to foreign-financed firms following WTO accession, effectively tilted the level-playing field against the Chinese pharmaceutical industry. Given the short-term competitive advantages of the Chinese pharmaceutical industry on Chinese drugs, three development strategies are suggested: (1) consolidate the local market of herbal and generic drugs; (2) market Chinese drugs via the Internet; and (3) outsource R&D and collaborative marketing.

General Information and Statistics

Chinese Pharmaceutical Industry Urged to Innovate New Drugs as WTO Looms. Beijing Establishes Its Largest Medical Valley. More Biomedical Staff Needed in Singapore. More Efforts Needed to Curb Snail Fever in China. India's Commodity Exchange to go Online. Nobel Laureate to Deliver Plenary Lecture at the 9th SCBA International Symposium.

General Information and Statistics

Rapid Growth for India's Healthcare Industry Predicted. Malaysia Unveils Plan for RM5 billion BioValley. Research Activities at Johns Hopkins, Singapore. Vienna Biocenter Invites Taiwan Companies and Highly Skilled Individuals. Super Computer "Shuguang"s Facilitates China's Genome Research. China Becomes World's Largest Fungi Producer. Four New Biotech Centers for Taiwan. Statistics on Ownership of Chinese Pharmaceutical Industry.

Merger and Acquisition Activity in the Chinese Pharmaceutical Industry

Merger and Acquisition Activity in the Chinese Pharmaceutical Industry

The determinants of international pharmaceutical firms’ FDI in China: a comparison between early (pre‐1992) and late (from‐1992) entrants

Aims to evaluate the determinants of international pharmaceutical firms’ foreign direct investments (FDI) in the Chinese pharmaceutical manufacturing industry. Focuses on comparing the differences in FDIs between early entrants who started FDI before 1992 and the late entrants whose FDI started after 1992 in China. Field research was mainly conducted in China by personal interview as well as mail questionnaires over a period of three months in 1999 and 44 companies participated in total. The results of index of dissimilarity analysis, t‐test and Wilcoxon test consistently show that both early and late entrants are likely to agree that China’s huge market size played the most important role in motivating international pharmaceutical firms’ FDI in China. The results did not support the traditional FDI theories on domestic market imperfection and firm specific advantages.

Transition Trajectories for Market Structure and Firm Strategy in China

Research in transition economies like China has sought and found explanations for strategic behaviour based on institutional and other social processes, leading to descriptions of China's emerging business system as ‘network capitalism’. This paper argues, however, that organizational capabilities and transaction costs are increasingly important influences on strategic choice as economic reforms proceed. An in‐depth case study of one firm's behaviour in two different asset markets – R&D and distribution in the Chinese pharmaceutical industry – illustrates fundamental differences in firm strategies for securing these assets. To account for this variety and move beyond the homogeneity implied by prior research, we propose a framework for differentiating the transition trajectories for different types of complementary assets. We propose conditions under which all three perspectives – institutional and social structure, organizational capabilities and transaction costs – predict similar trajectories and firm strategies, but different decision processes, and when their predictions differ.

Driving Forces of International Pharmaceutical Firms' FDI Into China

This paper presents the results of an exploratory investigation into the factorsthat drove the international pharmaceutical firms to make foreign direct investment(FDI) into the Chinese pharmaceutical manufacturing industry during the periodfrom 1980 to 1998. Research results show that international pharmaceutical firms'FDI into China was predominantly motivated by China's specific location factors.China's market size, with its great potential, played the most important role. Thefactors of rapid economic development and growth, China's open-door policy,and relatively stable political conditions were also found to be important factors.The incentive policies provided by China had limited impact on pharmaceuticalfirms FDI decisions. The results suggest that FDI decisions of early entrantswho started FDI before 1992 were more likely to consider the open-door policyas the second most important factor, whereas late entrants whose FDI startedsince 1992 seemed more likely to consider the Chinese economic developmentand growth as the second most important factor. The results also suggest thatrelatively stable political conditions in China have had a stronger positiveinfluence on the FDI decisions of the late entrants. Low labor and establishmentcosts in China as well as cultural related factors were not found to be significantfactors/or international pharmaceutical investors.