This study investigates the relationship between marketing intensity (MI), research and development (R&D) intensity and firm performance (FP) in the pharmaceutical sector in India. Specifically, it explores R&D intensity, listing status and product complexity as potential moderators in shaping the relationship between MI and FP.
Using a sample of 948 Indian pharmaceutical firms from 2010 to 2024, this study applies a generalized method of moments (GMM) estimator to test the main effects and moderation effects.
The results indicate strong linkages between MI and FP. Specifically, it has a strong positive impact on firms operating in a moderately R&D-intensive sector, while the relationship becomes negative in extremely low or very high R&D sectors. Furthermore, R&D exhibits threshold effects, documenting insignificant relationships in the short term and positive and significant effects in the long run.
The study findings are based on data from Indian pharmaceutical firms, which may limit their generalizability to other sectors. Future research should explore the cross-sectoral and international settings.
Managers can enhance FP by aligning R&D and marketing efforts based on product complexity to boost marketing effectiveness.
The strategic integration of R&D and marketing in the pharmaceutical sector can improve pharmaceutical firms' efficiency, benefiting society at large.
This study reveals an inverted U-shaped relationship between MI and FP. For listed firms, MI initially boosts FP but turns negative beyond the optimal levels. Medium-R&D products benefit from MI, while complex products show no MI gains, establishing complementarity with clear boundary conditions for our sampled firms.
