Determinants of the foreign R&D locational decision in the pharmaceutical industry

Locational determinants are an important input into any internationalisation process, but they are difficult to rank and measure. This paper describes an attempt to do both in the arena of the international pharmaceutical industry. In particular, the dispersal of R&D activities to six target countries (U.S., U.K., West Germany, France, Italy, Japan) is examined using thirty location-specific factors which are analysed in detail. In addition, indicators of differentiation between the perspectives of U.S. and European firms are derived.