How Pharmaceutical Innovation Benefits From Spatial Aggregation: A Perspective Based on R&D Cooperation Networks

ABSTRACT This paper empirically analyzes the relationship between pharmaceutical industry agglomeration and enterprise innovation based on drug registration application data and pharmaceutical enterprise data in China, and explores the mechanism of the role of agglomeration in influencing innovation from a perspective of research and development (R&D) cooperation networks. It was found that the spatial agglomeration of pharmaceutical firms significantly enhanced innovation and that agglomeration contributed to innovation through three transmission pathways of R&D cooperation networks, which were whether firms were in the network, their location in the network, and the diversity of their partners in the network. The further discussion shows that there is significant regional heterogeneity in the transmission mechanism of pharmaceutical industry agglomeration through R&D cooperation networks and thus affects innovation. The results of the study provide useful insights into how to take advantage of agglomeration and further understand the relationship between agglomeration and innovation.