Osong Public Health and Research Perspectives

Original Articles

The Determinants of Research and Development Investment in the Pharmaceutical Industry: Focus on Financial Structures: Munjae Lee, Mankyu Choi; Osong Public Health Res Perspect. 2015;6(5):302-309. Published online October 31, 2015; DOI: https://doi.org/10.1016/j.phrp.2015.10.013

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18 Citations

Objectives
This study analyzes the influence of the financial structure of pharmaceutical companies on R&D investment to create a next-generation profit source or develop relatively cost-effective drugs to maximize enterprise value.
Methods
The period of the empirical analysis is from 2000 to 2012. Financial statements and comments in general and internal transactions were extracted from TS-2000 of the Korea Listed Company Association (KLCA), and data related to stock price is extracted from KISVALUE-Ⅲ of NICE Information Service Co., Ltd. Stata 12.0 was used as the statistical package for panel analysis.
Results
The current ratio had a positive influence on R&D investment, the debt ratio had a negative influence on R&D investment, and return on investment and net sales growth rate did not have a significant influence on R&D investment.
Conclusion
It was found in this study that the higher liquidity ratio, the greater the R&D investment. The stability of pharmaceutical companies has a negative influence on R&D investment. This finding is consistent with the prediction that if a company faces a financial risk, it will be passive in R&D investment due to its financial difficulties.

Citations

Citations to this article as recorded by

The driving process of technological innovation in construction: a firm-level CDM analysis
Zheng Gong, Nannan Wang
Construction Innovation .2022; 22(2): 222. CrossRef
Envisioning the challenges of the pharmaceutical sector in the Indian health-care industry: a scenario analysis
Giuseppe Festa, Ashutosh Kolte, Maria Rosaria Carli, Matteo Rossi
Journal of Business & Industrial Marketing.2022; 37(8): 1662. CrossRef
Can the Profitability of Medical Enterprises Be Improved After Joining China's Centralized Drug Procurement? A Difference-in-Difference Design
Yu-Fei Hua, Jin Lu, Bing Bai, Han-Qing Zhao
Frontiers in Public Health.2022;[Epub] CrossRef
Ambidexterity's influence on export strategy development—The case of the Indian pharmaceutical industry
Ashutosh Kolte, Giuseppe Festa, Matteo Rossi, Alkis Thrassou, Demetris Vrontis, Michael Christofi
Thunderbird International Business Review.2022; 64(5): 465. CrossRef
Local pharmaceutical research and development capacity in a developing country: a qualitative exploration of perspectives from key stakeholders in Ethiopia
Muluken Nigatu Selam, Samuel Abera, Helen Geremew, Eskinder Eshetu Ali
Journal of Pharmaceutical Policy and Practice.2022;[Epub] CrossRef
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Jyothsna Gangolu, Sandyapakula Balaiah, Sisir Nandi, Harekrishna Roy
Brazilian Journal of Pharmaceutical Sciences.2022;[Epub] CrossRef
The contribution of intellectual capital to financial stability in Indian pharmaceutical companies
Giuseppe Festa, Matteo Rossi, Ashutosh Kolte, Luca Marinelli
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Harianto Lim, Rofikoh Rokhim
Journal of Economic Studies.2021; 48(5): 981. CrossRef
Impact of Monetary Policy Uncertainty on R&D Investment Smoothing Behavior of Pharmaceutical Manufacturing Enterprises: Empirical Research Based on a Threshold Regression Model
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International Journal of Environmental Research an.2021; 18(21): 11560. CrossRef
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Leonardo Andrade Rocha, Ahmad Saeed Khan, Patrícia Verônica Pinheiro Sales Lima, Maria Ester Soares Dal Poz, Carlos Alano Soares de Almeida
Revista de Economia Contemporânea.2018;[Epub] CrossRef

Impact of Corporate Governance on Research and Development Investment in the Pharmaceutical Industry in South Korea: Munjae Lee; Osong Public Health Res Perspect. 2015;6(4):249-255. Published online August 31, 2015; DOI: https://doi.org/10.1016/j.phrp.2015.07.003

2,066 View
18 Download
3 Citations

Abstract PDF

Objectives
The purpose of this study is to analyze the influence of the corporate governance of pharmaceutical companies on research and development (R&D) investment.
Methods
The period of the empirical analysis is from 2000 to 2012. Financial statements and comments in general, and internal transactions were extracted from TS-2000 of the Korea Listed Company Association. Sample firms were those that belong to the medical substance and drug manufacturing industries. Ultimately, 786 firm-year data of 81 firms were included in the sample (unbalanced panel data).
Results
The shareholding ratio of major shareholders and foreigners turned out to have a statistically significant influence on R&D investment (p < 0.05). No statistical significance was found in the shareholding ratio of institutional investors and the ratio of outside directors.
Conclusion
The higher the shareholding ratio of the major shareholders, the greater the R&D investment. There will be a need to establish (or switch to) a holding company structure. Holding companies can directly manage R&D in fields with high initial risks, and they can diversify these risks. The larger the number of foreign investors, the greater the R&D investment, indicating that foreigners directly or indirectly impose pressure on a manager to make R&D investments that bring long-term benefits.

Citations

Citations to this article as recorded by

EFFECT OF CORPORATE GOVERNANCE PRACTICES ON R&D AND INNOVATION COSTS: A CASE STUDY ON BORSA İSTANBUL
Bekir GEREKAN
Muhasebe ve Vergi Uygulamaları Dergisi.2021; 14(3): 967. CrossRef
Corporate governance and the environment in the health sector: Systematic literature review
Isabel Cristina Panziera Marques, Zélia Maria da Silva Serrasqueiro Teixeira, Fernanda Maria Duarte Nogueira
Journal of Governance and Regulation.2020; 9(2): 8. CrossRef
Differentiation of innovation strategies based on pharmaceutical licensing agreements: Insight from Korean pharmaceutical firms
Chie Hoon Song, Jens Leker
Technology Analysis & Strategic Management.2019; 31(2): 169. CrossRef

Analysis on Time-Lag Effect of Research and Development Investment in the Pharmaceutical Industry in Korea: Munjae Lee, Mankyu Choi; Osong Public Health Res Perspect. 2015;6(4):241-248. Published online August 31, 2015; DOI: https://doi.org/10.1016/j.phrp.2015.07.001

2,059 View
13 Download
13 Citations

Abstract PDF

Objectives
The aim of this study is to analyze the influence of the research and development (R&D) investment of pharmaceutical companies on enterprise value.
Methods
The period of the empirical analysis is from 2000 to 2012, considering the period after the influence of the financial crisis. Financial statements and comments in general and internal transactions were extracted from TS-2000 of the Korea Listed Company Association, and data related to stock price were extracted from KISVALUE-III of National Information and Credit Evaluation Information Service Co., Ltd. STATA 12.0 was used as the statistical package for panel analysis.
Results
In the pharmaceutical firms, the influence of the R&D intensity with regard to Tobin's q was found to be positive. However, only the R&D expenditure intensities of previous years 2 and 5 (t–2 and t–5, respectively) were statistically significant (p < 0.1), whereas those of previous years 1, 3, and 4 years (t–1, t–3, and t–4, respectively) were not statistically significant.
Conclusion
R&D investment not only affects the enterprise value but is also evaluated as an investment activity that raises the long-term enterprise value. The research findings will serve as valuable data to understand the enterprise value of the Korea pharmaceutical industry and to strengthen reform measures. Not only should new drug development be made, but also investment and support should be provided according to the specific factors suitable to improve the competitiveness of each company, such as generic, incrementally modified drugs, and biosimilar products.

Citations

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Muhasebe ve Vergi Uygulamaları Dergisi.2021; 14(3): 1193. CrossRef
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Chih-Yi Su, Yao-Ning Guo, Kuang-Cheng Chai, Wei-Wei Kong
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