منابع رشد بهره وری در صنعت داروسازی اسپانیایی (1994-2000)

The Spanish pharmaceutical industry underwent an important transformation during the 1990s. To survive under the new market conditions, labs had to refocus their competitive strategies towards increasing productive efficiency or reinforcing research and development (R&D) activities. This paper analyzes the evolution of the productive patterns in a sample of 80 pharmaceutical laboratories that operated in Spain from 1994 to 2000. We estimate Malmquist productivity indexes and decompose them into four sources of productivity change. The results suggest that pure technical efficiency change and the scale change of the technology explain most of the productivity growth observed during the period. The contribution of technical change to productivity growth is negligible, indicating a poor result from R&D activities at least in the groups of Small and Medium-sized labs.

Several important regulatory changes shaped the evolution of the Spanish pharmaceutical industry during the 1990s. First, the 1990 Drugs Act introduced new safety, quality, and effectiveness requirements for the registration of new drugs. Second, the 1986 reform in the patents system, adopted as a consequence of Spain’s entry into the European Union, allowed for product patents to be registered in Spain from 1992 on. Third, the method employed to regulate the price of drugs was also changed in 1990. Despite the fact that since 1998 the Government can only regulate the prices of the drugs financed by the Health Administration, in practice, price controls on drugs intensified due to the pressure to comply with the strict budgetary requirements to enter the European Monetary Union. The objective of this paper is to assess how these changes have affected the productive activity of the Spanish pharmaceutical laboratories. Pharmaceutical activity is complex, and can be divided into three principal tasks: production, distribution, and research and development (R&D). In the early evolution of the Spanish pharmaceutical industry, a protectionist regulatory environment fostered the proliferation of local labs whose main activity consisted of copying and manufacturing foreign products that were unprotected by product patents in Spain or other European countries. This situation also led multinationals to locate production plants in every European country. The landscape changed dramatically after the consolidation of the European Common Market. Frontiers within the Euro-zone virtually disappeared and multinationals concentrated production in order to achieve economies of scale (Rodrı́guez and Miravitlles, 1999). With respect to R&D activities, the primary inputs are the skills of scientists and the ability to maintain an extensive flow of information within firm boundaries and also between the firm and the scientific community. Firms wishing to take advantage of research conducted beyond the organizational boundaries need to invest in “absorptive capacity” (Cohen and Levinthal, 1989). In other words, they need to accumulate the knowledge, skills, and organizational routines needed to identify and use the knowledge that has been generated elsewhere (Cockburn and Henderson, 1998). Pharmaceutical research activities are subjected to significant economies of scale and scope1 (Henderson and Cockburn, 1996). The third task undertaken by pharmaceutical labs is commercialization. Labs commercialize two types of pharmaceutical products: own products (developed in-house) and licensed products (developed by other labs). The highest margins and sales come from own products. In general, labs concentrate their research efforts on a narrow range of pharmaceutical products, although sales may spread over a wide variety of products (licensed and generics). In order to gain access to a license the most important aspect is the sales force under the control of the lab. Competition to obtain licenses induces a decline in commercial margins. The environmental changes mentioned above have tended to increase the weight given to drugs commercialization in the activity of international companies present in Spain, thereby reducing investment in R&D and production facilities. To assess the impact of these regulatory changes in the Spanish pharmaceutical industry, this paper estimates the sources of productivity change during the period 1994–2000 in a sample of 80 Spanish labs. We first describe the recent evolution of the Spanish pharmaceutical industry. Then, we present a non-parametric model that permits the measurement of pharmaceutical productivity change and its decomposition into two indexes related to efficiency gains and two indexes related to technical change. The subsequent sections describe the data and discuss the results. Concluding remarks are presented in a final section.

This paper has estimated the sources of productivity change in the Spanish pharmaceutical industry during the second half of the 1990s. The results show a notable contribution of technical efficiency to productivity growth, whereas the impact of technical change was, on average, negligible. During the 1990s, many changes in the regulation environment affected the Spanish pharmaceutical industry. First, the introduction of the product patent in 1992 imposed a serious constraint on labs whose main activity was to copy an existing product to produce it and commercialize it in Spain. Second, the need to meet the criteria for entry into the European Monetary Union made the Spanish Government a tougher negotiator in this regulated sector. These pressures have materialized in an intensification of the regulation of drugs prices. While the consumer price index increased by a 30.4% during the period, the pharmaceutical price index increased just an 8.5%. Given this situation, Spanish pharmaceutical labs have three strategic options with which to face the future. They can intensify their R&D efforts, expanding their production possibilities and thereby enabling themselves to develop high margin and patented own products. They can also concentrate in the market for generic drugs not protected by product patents. Finally, they can concentrate on the production and/or commercialization of licensed products. The latter options involve a fundamental change in the competitive strategy that the firm should follow (Rovira, 1998). The source of competitive advantage for the firms that follow this reorientation towards generics or licensed products will change from differentiation (marketing, promotion) to cost leadership (static productive efficiency). The important impact of technical efficiency change on productivity growth may reflect that some labs have already begun to refocus their competitive strategies along the lines indicated above. The contribution of technical efficiency change to productivity growth is more important in the group of Small labs, precisely the group that may be most affected by the new situation. In contrast, technical change has been the main source of productivity growth in the group of Large labs, reflecting their ability to expand their production possibilities through innovation. Within the group of Medium-sized labs, both factors have contributed to productivity growth in more or less the same proportion. The empirical study presented here has some limitations. First, we only had access to aggregated accounting magnitudes. Thus, we cannot provide a more exhaustive analysis of the strategic options followed by different groups of labs and relate these strategies to the outcomes obtained. Moreover, given the long time period that the development of new drugs involves, the impact of the product patent introduced in 1992 would reasonably intensify from 2000 on. Third, we have interpreted the results obtained as a consequence of the profound regulatory changes that affected the industry during the 1990s. While we are confident that our estimates reflect the main trends in the reorganization of the industry after the regulation changes that occurred during that decade, other forces may have contributed to generate the results.15 For example, technical progress is always expected in an R&D-intensive industry such as the pharmaceutical industry, regardless of regulation concerns. Multinationals have introduced an increasing number of new high-margin drugs in Spain in the last years that have been generated from research efforts that foster technical progress. However, it is not clear that these innovations would have reached the Spanish industry without the protection of product patents that was granted after 1992. Thus, regulation changes may directly affect productivity change and also interact with other driving forces to generate the patterns finally observed.