Location of the Largest Pharmaceutical Companies in Russia: Contribution to Regional Divergence or Convergence?

O. V. Kuznetsova () and R. O. Bobrovsky ()
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O. V. Kuznetsova: Plekhanov Russian University of Economics
R. O. Bobrovsky: Plekhanov Russian University of Economics

Regional Research of Russia, 2022, vol. 12, issue 2, 124-132

Abstract: Abstract— The objective of the article is to identify factors for the location of pharmaceutical enterprises in Russian regions, including from the viewpoint of assessing the possible contribution of the pharmaceutical industry to the reduction of territorial disproportions in the level of economic development. The pharmaceutical production location factors is analyzed based on a generalization of foreign studies on the topic and a database compiled by the authors on the manufacturing enterprises of more than 50 largest pharmaceutical companies in Russia (taking into account the construction time and large-scale modernization of enterprises belonging to Russian or foreign owners). It is concluded that Russia experiences the same factors of pharmaceutical enterprises’ location as abroad: the importance of historically established centers of production is characteristic, including in the eastern regions of the country (due to the reduced role of the transport factor for the industry); preference is often given to expanding capacities of already existing enterprises, instead of construction of new ones; new factories appear on the basis of established pharmaceutical research centers and/or with focus on markets of the largest urban agglomerations and/or in special economic zones and industrial parks. When building new enterprises, investors can seek both to participate in pharmaceutical clusters and save on production costs, including wages, by building factories in areas not saturated in industries. Foreign investment mainly reach only to the western regions of the country due to their capacious sales market and proximity to the countries of origin of companies, which are predominantly European. As a result of numerous factors, the impact of development of pharmaceutical production on territorial disproportions is ambiguous.

Keywords: pharmaceutical industry; major pharmaceutical companies; foreign investment; localization factors; clusters; research centers; special economic zones; sales markets (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1134/S2079970522020174

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