The Study On Chinese Medicine Manufacturing Enterprise Vertical Intergration Inpact On Enterprise Performance

Since the reform and opening up, Chinas pharmaceutical industry has beendeveloping rapidly, many large pharmaceutical enterprises scale expansion, need tochoose the future development model and strategy. In this context, a number oflarge enterprises begin to buy recombine upriver enterprise or since the raw materialmedicine manufacturing enterprises, the implementation of vertical integrationstrategy, in an attempt to solve the incomplete contract, information asymmetry,reach the technical talent resource sharing, improve production technologyefficiency.This paper reviews the domestic and foreign vertical integration and efficiencyof technological innovation theory and research, then introduces the currentsituation of industry of our country medicine organization form, and combined withthe theory of industrial organization from four aspects of the pharmaceuticalindustry in China to cause flooding. In empirical research, the pharmaceuticalindustry in2001-2010year data analysis of pharmaceutical industry of currenttechnology innovation efficiency and vertical integration index, using a simpleregression model on the pharmaceutical industry vertical integration and technologyinnovation efficiency influence trend test, reached our country medicine industryvertical integration index and technology innovation efficiency index showed apositive correlation.Domestic and foreign have yet to pharmaceutical industry vertical integrationdegree and efficiency of technological innovation and the relationship between donesystematic research. Based on the previous research, in a large collection ofinformation on the basis of theoretical modeling, write a final paper. This paper willuse the theories of economics and the existing model, combined with Chinaspharmaceutical industry vertical integration development model, using DEAMalmquist index in the evaluation of efficiency of technology innovation inpharmaceutical industry, and use the I/O model to measure the degree of integrationand the pharmaceutical industry, the medicine industry vertical integration degree and the efficiency of technological innovation in regression analysis.In this paper, through the analysis of current situation of industry of our countrymedicine organization form, the medical industry of our country low marketconcentration, advertising investment amount is large, low barriers to entry, exit andhigh barriers, and pharmaceutical enterprises to implement vertical integration canbe external to internal problems, improving the degree of market concentration,reduce the medical industry market transaction costs, avoid the incomplete contract,strategy risk and secure such as risks, to the pharmaceutical industry brings scalebenefit. Along with the medicine enterprise vertical integration degree increases, thetechnical innovation of pharmaceutical enterprises efficiency is improved, boththrough the regression analysis showed a positive correlation.