The Impact Of R&D Expenses Plus Deduction On R&D Investment Of Pharmaceutical Companies

At present,the country is accelerating the construction of a strong manufacturing country,emphasizing the high-quality development of manufacturing industry,and striving to solve the "stuck" technical problems through innovative means.R&D innovation is one of the important ways for pharmaceutical companies to get rid of generic drugs and gain competitive advantages in the market.In 2021,China launched a more preferential deduction policy for the manufacturing industry-an upward adjustment of the deduction ratio to 100%,aiming to boost the manufacturing industry by way of tax concessions.The new development of innovation.Based on relevant theoretical analysis,this thesis summarises the development characteristics of China’s R&D expense deduction policy,analyses the development status and R&D status of pharmaceutical enterprises,takes the data of pharmaceutical manufacturing companies listed in Shanghai and Shenzhen A-shares for five consecutive years from2017 to 2021 as a sample,establishes a two-way fixed-effect model to study the impact of the intensity of R&D expense deduction preferences on R&D investment of pharmaceutical enterprises,and groups enterprises according to their location The regressions were conducted in groups according to the location,size and nature of ownership of the enterprises to investigate the implementation effect of this policy.The empirical results show that the policy does have a positive effect on R&D investment in the pharmaceutical manufacturing industry,with a greater impact on eastern,large-scale and state-owned enterprises.Therefore,based on the theoretical analysis and empirical findings,suggestions are made to optimise the design of the add-on deduction policy,formulate a "preferential" policy that takes into account the heterogeneity of enterprises,reduce the cost of enterprises to enjoy the policy benefits and strengthen the tax incentives for R&D human capital,in order to stimulate R&D innovation in China’s pharmaceutical manufacturing industry.