Competitiveness, profitability and R/D intensity : the case of the domestic pharmaceutical industry in Greece

Greek pharmaceutical industry has been emerged as one of the major drivers for the Greek manufacturing sector mostly from 2000 until 2011. The value-added of the industry in the overall economy is indicated through its impact on the gross value-added production, employment, exports, innovation and global competiveness. Greek pharmaceuticals firms have one of the highest shares of investment in innovation and R&D activities in the total Greek economy. The purpose of this study is to investigate the potential causal relationship between industry-level competitiveness, profitability and R/D intensity. Specific financial ratios have been selected for the regression analysis using a sample of Greek pharmaceutical firms with in-house Research and Development department. The period of the analysis has been defined between 2004 and 2015. According to the existing literature, it is expected that R/D intensity plays a significant role on the profitability for pharmaceutical firms.