# Research on the Operating Efficiency of Chinese Listed Pharmaceutical Companies Based on Two-Stage Network DEA and Malmquist

Authors: Tsung-Xian Lin; Zhong-huan Wu; Xiao-xia Ji; Jia-jia Yang
Journal: Mathematical Problems in Engineering
 (2021)

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## Abstract

The development of pharmaceutical companies, which is an important part of the national economy and industry, is closely related to people’s livelihood issues. With the era of big data, this paper uses the two-stage DEA and Malmquist method to evaluate the efficiency of listed Chinese pharmaceutical companies. From a static and dynamic perspective, it analyses the total factor productivity index, pure efficiency change index, scale efficiency index, and so on. The results show that government subsidies have not had a positive impact on most Chinese pharmaceutical companies, and for films, diseconomies of scale caused by rapid expansion should be avoided.


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## Body

## 1. Introduction

Since the outbreak of the COVID-19, medical health has become the primary topic of concern for the government and the public. The operation of pharmaceutical companies has become the focus of discussion. At present, China’s pharmaceutical manufacturing industry has long been in a state of low industry concentration, high product homogeneity, and weak technological innovation capabilities. It has a large gap with the international advanced level. In recent years, China’s various medical reform policies and regulations have been promulgated one after another. It has brought many uncertain factors to the development of the pharmaceutical industry. How to adapt to changes in the external environment and further improve operating efficiency has become an important issue facing the government and enterprises. Based on the above background, this article focuses on the research on the operating efficiency of pharmaceutical companies, innovatively combining the DEA method with Malmquist, taking 164 listed companies in China as a sample, and studying their operating conditions during the five-year period from 2015 to 2019.The structure of the following parts of this article is as follows. Section2 collects current scholars’ research on the efficiency evaluation of pharmaceutical companies; Section 3 introduces the related content of the two-stage network DEA and Malmquist index method in this article; Section 4 outlines the research of this article process, sample selection, and two-stage DEA data analysis. Section 5 uses Malmquist to analyse the dynamic effects of the data and finally summarizes the research results of this article.


## 2. Literature Review

At present, many scholars use the DEA method to measure the actual situation of the operating efficiency of pharmaceutical companies and provide suggestions for improvement of the company’s operations. For example, Wang [1] selected Chinese biopharmaceutical companies from 2017 to 2019 as a research sample and established a static DEA model to measure their financing efficiency. The results show that although the overall financing efficiency of Chinese biotech companies is not high, the level of it is increasing year by year. And Zhang Zicheng [2] innovatively combined the AHP method with the DEA method, finding that, compared with the scale factor, the deficiency of technology hinders the operating performance of companies such as Lunan Pharmaceutical firm. Meanwhile, Li et al. [3] used a two-step method of factor analysis and SE-DEA model to calculate the financial data of 58 listed pharmaceutical companies in China from 2009 to 2013 and concluded that the overall inefficiency of the pharmaceutical industry is also due to insufficient investment on scale and technology.Among them, some scholars even divide medical companies into groups to study their operational status in different regions [4, 5]. The research found that there are indeed differences in the operating efficiency as well as in terms of technological innovation of pharmaceutical companies in different regions [6, 7]. For example, Xiong [8] used the panel data of technological innovation of medical companies listed in Guangdong, Shandong, Zhejiang, and Jiangsu as samples to study the allocation of technological innovation resources of pharmaceutical manufacturers in four provinces in China from 2015 to 2017 and finally came to the following conclusions: in the province, Jiangsu pharmaceutical companies have the advantage of pure technical efficiency in innovation activities, while Guangdong pharmaceutical companies performed better in scale efficiency with regard to technological innovation. However, the traditional DEA model cannot study the influencing factors in the process. Therefore, the research studies on the two-stage network DEA model and the Malmquist index method have received widespread attention from many scholars.Regarding the two-stage network DEA, such method has been applied to plenty of fields. For example, Lewis et al. applied the undirected network DEA method to the efficiency evaluation of Major League Baseball [9]. Additionally, Liang et al. used a two-stage network DEA model to analyse the input-output efficiency of 50 universities in China [10], while Li et al. applied the DEA model under the two-stage expansion structure to the research on the efficiency of R&D in China’s provincial regions [11]. At the same time, some researchers also combine two-stage network DEA with other methods. For instance, Chen et al. [12] and Kao [13] combined it with the two-stage additive efficiency decomposition DEA method to study the relative efficiency of 24 non-life insurance companies in Taiwan. Lee and Johnson combined Malmquist under the network DEA structure to study the performance of the semiconductor manufacturing industry [14]. It can be seen that the two-stage network DEA has been widely used in insurance companies, universities, and other industry research. However, research in the pharmaceutical industry is still relatively rare.Regarding the Malmquist index method, scholars have also made great achievements. In the field of sustainable e-agriculture, Pan and others used the 31 provinces as the research objects and explored the sustainable development efficiency of agriculture in mainland China through DEA and Malmquist productivity index models [15]. In the medical industry, Hashimoto and Haneda [16] used the conventional DEA method and the Malmquist productivity index method to measure the R&D efficiency of the Japanese pharmaceutical industry from the enterprise level and the industry level, respectively. Empirical evidence shows that the total factor productivity of Japan’s pharmaceutical industry is declining, and the main reason for the decline is the sharp decrease in technological changes. What is more, Pannu et al. [17] used the output-oriented VRS model and the Malmquist productivity index method to measure the increase in efficiency and productivity of the Indian pharmaceutical industry over a 10-year period, finding that the increase was mainly due to the growths in technical efficiency. Furthermore, Zhiyue and Qiu [18] also used the Malmquist index method to conduct an empirical analysis of the operating efficiency of China’s biopharmaceutical industry from both horizontal and vertical aspects. The results show that the overall operating efficiency of the biopharmaceutical industry is not ideal, and there is a large difference in efficiency between provinces and cities.In summary, it can be seen that scholars have used many different methods to study the operating efficiency of pharmaceutical manufacturing enterprises, but the research still has the following shortcomings. Firstly, most research studies on the efficiency of pharmaceutical manufacturing enterprises use nonparametric methods. When measuring enterprise efficiency, some scholars only consider a certain aspect of static or dynamic and thus cannot comprehensively analyse the efficiency level and development trend of pharmaceutical manufacturing enterprises. Secondly, there are few literatures on the research of listed pharmaceutical companies using the two-stage network DEA and Malmquist index method, most of which focus on the traditional DEA method. Finally, in the literature on efficiency influencing factors, the selection of variables is relatively limited, and there are few literatures that consider the R&D capabilities of enterprises. For pharmaceutical manufacturing companies, environmental variables are very important and have a very large impact on the efficiency of the company. Therefore, the external environment of the company should be considered when studying the efficiency of the company. Based on the above deficiencies, this paper uses the two-stage network DEA and Malmquist index method to study the operating efficiency of enterprises from both static and dynamic perspectives. When studying the factors affecting the operating efficiency of enterprises, environmental variables have been added and considered from multiple angles in the article, striving for a more comprehensive selection of influencing factors.


## 3. Research Method

### 3.1. Two-Stage Network DEA

In the traditional DEA model, we only know the final efficiency values of the entire process, but the specific situation in the whole process is unknown. The information provided by the traditional DEA model is not enough, and the guidance to managers is limited. The two-stage network DEA model can open the “black box” of the production system, which can effectively measure the complex production network. Therefore, this paper also adopts the two-stage network DEA model for performance evaluation and pays more attention to the progressive relationship between the two stages based on the research results of other scholars. Its internal structure is shown in Figure1.Figure 1
The two-stage network DEA model.Among them,Xij1i=1,2,…,I represents the i-th input of DMUj in the first stage; Zdjd=1,2,…,D represents the intermediate variable, namely, it is not only the d-th output of DMUj in the first stage, but also the d-th input of DMUj in the second stage; Xkj2k=1,2,…,K represents the k-th input of the newly added DMUj in the second stage; and yrjr=1,2,…,R represents the r-th output of DMUj in the second stage. First of all, calculate the efficiency of the first stage and then calculate the efficiency of the second stage on this basis, which means keeping the efficiency of the first stage unchanged. Finally, the product of the efficiency of the two stages is regarded as the total efficiency of the system. At this point, the model can be established as follows:The first-stage model (model 1) is given by(1)Max∑d=1DWdZd0∑i=1IViXi01,(2)s.t.∑d=1DWdZdj∑i=1IViXij1≤1,j=1,2,…,n,(3)∑r=1RUrYrj∑d=1Dzdj+∑k=1ktkxkj2≤1,j=1,2,…,n,(4)Ur,Vi,Wd,tk≥0,∀r,i,d,k.Model 1 adds a constraint on the basis of the traditional CCR model, that is, the last constraint. Its purpose is to ensure that the optimal solution of the first stage makes the efficiency value of the second stage not more than 1, so as to ensure that the second stage model must have a feasible solution; otherwise, there may be no feasible solution. Therefore, this constraint is necessary, which was not considered in the previous two-stage DEA model. In model 1,Ur,Vi,Wd,tk, respectively, represent the weights of the corresponding variables, after considering the study conducted by Cheng and Zheng [19]. The efficiency of each DMU can be obtained by model 1. Record the efficiency of the DMU0 as θ10∗.Then second-stage model (model 2) is given by(5)Max∑r=1RUrYr0∑d=1DWdZd0+∑k=1ktkxk02,(6)s.t∑d=1DWdZdj∑i=1IViXij1≤1,j=1,2,…,n,(7)∑r=1RUrYrj∑d=1DWdZdj+∑k=1ktkxkj2≤1,j=1,2,…,n,(8)∑d=1DWdZd0∑i=1IViXi01=θ10∗,(9)Ur,Vi,Wd,tk≥0,∀r,i,d,k.Solving (5)–(9) can get the efficiency of the second-stage DMU, noting θ20∗ as the efficiency of the second stage. So far, it can be concluded that the total efficiency of the two-stage system DMU0 is θ0∗=θ10∗θ20∗ (10).


### 3.2. Malmquist Index

The two-stage network DEA model just horizontally compared the efficiency of listed pharmaceutical enterprises. So we will build the Malmquist index model to make a longitudinal analysis of efficiency and dynamically analyse the change of efficiency.TFP is total factor productivity index:(10)TFP=Dtuxt,ytDt−1uxt−1,yt−1×Dtxt,yt/Dt−1Cxt−1,yt−1Dtuxt,yt/Dt−1uxt−1,yt−1×Dt−1Cxt−1,yt−1DtCxt−1,yt−1×Dt−1Cxt,ytDtCxt,yt1/2.PEC is pure efficiency change index:(11)PEC=Dtuxt,ytDt−1uxt−1,yt−1,SE is scale efficiency index:(12)SE=DtCxt,yt/Dt−1Cxt−1,yt−1Dt4xt,yt/Dt−1uxt−1,yt−1,TC is technical change index:(13)TC=Dt−1Cxt−1,yt−1DtCxt−1,yt−1×Dt−1Cxt,ytDtCxt,yt1/2,The formula of total factor productivity is(14)TFP=PEC×SE×TC.


## 3.1. Two-Stage Network DEA

In the traditional DEA model, we only know the final efficiency values of the entire process, but the specific situation in the whole process is unknown. The information provided by the traditional DEA model is not enough, and the guidance to managers is limited. The two-stage network DEA model can open the “black box” of the production system, which can effectively measure the complex production network. Therefore, this paper also adopts the two-stage network DEA model for performance evaluation and pays more attention to the progressive relationship between the two stages based on the research results of other scholars. Its internal structure is shown in Figure1.Figure 1
The two-stage network DEA model.Among them,Xij1i=1,2,…,I represents the i-th input of DMUj in the first stage; Zdjd=1,2,…,D represents the intermediate variable, namely, it is not only the d-th output of DMUj in the first stage, but also the d-th input of DMUj in the second stage; Xkj2k=1,2,…,K represents the k-th input of the newly added DMUj in the second stage; and yrjr=1,2,…,R represents the r-th output of DMUj in the second stage. First of all, calculate the efficiency of the first stage and then calculate the efficiency of the second stage on this basis, which means keeping the efficiency of the first stage unchanged. Finally, the product of the efficiency of the two stages is regarded as the total efficiency of the system. At this point, the model can be established as follows:The first-stage model (model 1) is given by(1)Max∑d=1DWdZd0∑i=1IViXi01,(2)s.t.∑d=1DWdZdj∑i=1IViXij1≤1,j=1,2,…,n,(3)∑r=1RUrYrj∑d=1Dzdj+∑k=1ktkxkj2≤1,j=1,2,…,n,(4)Ur,Vi,Wd,tk≥0,∀r,i,d,k.Model 1 adds a constraint on the basis of the traditional CCR model, that is, the last constraint. Its purpose is to ensure that the optimal solution of the first stage makes the efficiency value of the second stage not more than 1, so as to ensure that the second stage model must have a feasible solution; otherwise, there may be no feasible solution. Therefore, this constraint is necessary, which was not considered in the previous two-stage DEA model. In model 1,Ur,Vi,Wd,tk, respectively, represent the weights of the corresponding variables, after considering the study conducted by Cheng and Zheng [19]. The efficiency of each DMU can be obtained by model 1. Record the efficiency of the DMU0 as θ10∗.Then second-stage model (model 2) is given by(5)Max∑r=1RUrYr0∑d=1DWdZd0+∑k=1ktkxk02,(6)s.t∑d=1DWdZdj∑i=1IViXij1≤1,j=1,2,…,n,(7)∑r=1RUrYrj∑d=1DWdZdj+∑k=1ktkxkj2≤1,j=1,2,…,n,(8)∑d=1DWdZd0∑i=1IViXi01=θ10∗,(9)Ur,Vi,Wd,tk≥0,∀r,i,d,k.Solving (5)–(9) can get the efficiency of the second-stage DMU, noting θ20∗ as the efficiency of the second stage. So far, it can be concluded that the total efficiency of the two-stage system DMU0 is θ0∗=θ10∗θ20∗ (10).


## 3.2. Malmquist Index

The two-stage network DEA model just horizontally compared the efficiency of listed pharmaceutical enterprises. So we will build the Malmquist index model to make a longitudinal analysis of efficiency and dynamically analyse the change of efficiency.TFP is total factor productivity index:(10)TFP=Dtuxt,ytDt−1uxt−1,yt−1×Dtxt,yt/Dt−1Cxt−1,yt−1Dtuxt,yt/Dt−1uxt−1,yt−1×Dt−1Cxt−1,yt−1DtCxt−1,yt−1×Dt−1Cxt,ytDtCxt,yt1/2.PEC is pure efficiency change index:(11)PEC=Dtuxt,ytDt−1uxt−1,yt−1,SE is scale efficiency index:(12)SE=DtCxt,yt/Dt−1Cxt−1,yt−1Dt4xt,yt/Dt−1uxt−1,yt−1,TC is technical change index:(13)TC=Dt−1Cxt−1,yt−1DtCxt−1,yt−1×Dt−1Cxt,ytDtCxt,yt1/2,The formula of total factor productivity is(14)TFP=PEC×SE×TC.


## 4. Empirical Analysis

### 4.1. Sample Selection

With reference to the definition of pharmaceutical companies, combined with the description of the main business in the annual report of the A-share listed pharmaceutical company and the proportion of the main business in operating income, the study sample is determined. At the same time, to ensure the validity of the analysis results, ST, PT, andST∗ companies were excluded, and 164 listed pharmaceutical companies were finally identified as the research samples. The data of inputs and outputs comes from Cathay Pacific database and the annual public report of enterprise.


### 4.2. Variable Selection

#### 4.2.1. The First Stage of Input and Output Variables

The selection of variables is based on character of listed pharmaceutical companies, and we fully inspect the business characteristics and operation of listed pharmaceutical companies. The inputs selected are gross costsX1, total number of employees X2, and net value of fixed assets X3, and the output is gross revenue Y1.


#### 4.2.2. The Second Phase of Input and Output Variables

This paper comprehensively examines the business characteristics and operation of listed pharmaceutical companies. Government subsidiesX5 as a new input are added to the second stage, and the other input is the gross revenue X4 that is the output of first stage, and the final output is net profit Y2. More details are shown in Table 1.Table 1
Variable selection and measurement.
Variable typeVariable nameMeasureThe first stageOutputGross costsGross costs in corporate annual reportsInputTotal number of employeesTotal number of in-service staffNet value of fixed assetsNet value of fixed assets in corporate annual reportsGross revenueGross revenue in corporate annual reportsThe second stageOutputNet profitTotal profit − income taxInputGross costs—Government subsidiesGovernment subsidies that are included in the current profit and loss


### 4.3. DEA Efficiency Analysis in the First Stage

In first stage (shown in Table2), no listed pharmaceutical company’s technical efficiency reached 1 during 2015–2019. There are 119 companies with technical efficiency between 0.6 and 1.0, accounting for 73%, indicating that the technical efficiency of these companies is good. The efficiency values of the eight securities companies (Chongqing Taiji Industry, Baiyunshan, Kelun, Huabei, Hisun, Harbin, China Medicine, and Renfu) are below 0.4, indicating that the technical efficiency level of these companies is relatively low, and they need to increase investment.Table 2
Summary of means of technical efficiency.
Company nameThe first stageThe second stageTotalAdisseo0.7318074470.704276450.718041949Anke Bio0.7012585450.656816190.679037367Osaikon0.775171440.6777564860.726463963Baiyunshan0.3837606110.3295685680.35666459Bdyy0.6210632530.6681726570.644617955Beilu0.7554567290.6625218950.708989312Porton0.6264431980.6538941420.64016867None0.7082054890.6447921190.676498804Changchun High-Tech0.7541401170.7609207620.757530439Changjiang Runfa Medicine0.6224442990.5819566940.602200497Changshan Pharma0.7053799570.6632150030.68429748DAJY0.6114166220.5700904910.590753556Dezhan0.8001387090.7762217530.788180231Jiao0.688130710.7612620560.724696383DBBT0.7157380240.6415931590.678665591VC0.4631213490.467031950.465076649Dongcheng0.673841180.6807023720.677271776Nhwa Pharm0.6557346490.6673497180.661542183Ekzy0.6790414270.5787081060.628874767Fangsheng0.7001944710.6566333680.678413919Fengyuan0.581329290.491931380.536630335Fczy0.6780399190.6519809450.665010432Fayy0.647768470.5934469240.620607697Fosun Pharm0.4696824420.7446472960.607164869Fuxiang0.6992155670.6003480210.649781794Guangji0.6864166930.6408386060.66362765Kwong Sang Hong0.7399910670.6508356770.695413372Guang Yuyuan0.6978039310.6435731720.670688552Lark0.6303814640.6577467230.644064093Glsj0.6771209870.6827962410.679958614Sinopharm Hyundai0.4962214360.3975137510.446867593Harbin Pharm0.344289280.4757911430.410040211Haili Bio0.7278830950.6526821230.690282609Hnhy0.6099837750.5285809960.569282386Hepalink0.643895660.5944038590.619149759Haishun New Pharma0.7509284240.6616757150.706302069Haisco0.7204516960.4877439870.604097841Hisoar0.6455446230.654604210.650074417Haixin0.6275990870.6720977460.649848417Hisun0.3534604940.4090155540.381238024Han Sen Pharm0.6687777520.6638996460.666338699Hybio0.6360330860.5808102370.608421662Hengrui0.8374905270.9613027390.899396633Chase Sun0.5477339190.4100160.478874959NCPC0.362596570.4478019280.405199249Huahai0.5439954090.5535336650.548764537Hualan Bio0.8079312130.5958469140.701889064Huaren0.5953284720.6596448380.627486655HRSJ0.5417748610.5744257380.558100299China Resources Double-Crane0.5680388280.546222750.557130789Huashen Technology0.7191994180.6740355690.696617493Walter Dyne0.6645965360.6871962190.675896377Yanbian FC0.7781422580.635909630.707025944Kyrgyzstan0.6016169260.4960279760.548822451Jichuan0.6838072040.4878549070.585831056Jimin0.6811853090.6573225040.669253906JYPC0.6855629210.6496412110.667602066Joincare pharm0.6100824570.4541422960.532112376Jiangzhong0.6425678470.7365676640.689567756Jincheng0.6397853890.5691783680.604481878Jinhe Bio0.6233545770.6490286610.636191619Jinling0.5462357190.6355768440.590906281Jinshiya0.7157966670.6447578820.680277274Jingxin0.685712910.5703881420.628050526Jinghua0.6369449780.6416492870.639297132Jingfeng0.6064889590.5435304950.575009727Jiuqiang0.7869562280.7000462070.743501218Jiuzhitang0.6452010260.5166030240.580902025Jiuzhou0.6285671150.5841554220.606361268CONBA0.5438613750.4810043480.512432862Kanghong0.6652450110.5274608360.596352924Kangyuan0.614142040.5779269920.596034516Kangzhi0.6848160870.6564158710.670615979KHB0.7279765070.5918412980.659908903Kelun0.3787994410.4932316980.43601557Sunflower0.5561700970.5114002440.533785171Kunming Pharm0.5343244160.5519641910.543144303Lummy0.6250562280.6281127550.626584491LAYN0.7216144840.6615664790.691590481Lisheng Pharma0.6573538550.6791771390.668265497Livzon Pharm0.717381340.6288710940.673126217LEADMAN0.7149442890.6244983450.669721317Lianhuan pharm0.6988884110.6703671180.684627765Lingkang0.7257438740.5846945180.655219196Lingrui Pharm0.6669977470.6770707790.672034263Long jin Pharm0.7535702720.6471331660.700351719Lukang Pharm0.5090276380.4609652450.484996442Mike Bio0.7424225130.6504076940.696415103M.k.0.6542204370.5623562830.60828836Palin Bio0.7032698360.651091860.677180848PIEN TZE HUANG0.7638245580.7260050710.744914814Julie Plec0.7096241660.4697892280.589706697plyy0.4896138090.530540520.510077164CHEEZHENGTTM0.7146898140.6135826460.66413623Qidi0.6910539390.6549773340.673015636Qianhong Biopharma0.702282140.6792034570.690742799Qianjin Pharm0.6126471810.6075908240.610119003Qianyuan0.6649734140.5568454970.610909455Renfu0.3224064250.420165550.371285988Renhe Pharmacy0.5963514720.6726796190.634515546rpsw0.6511669250.59129460.621230762Saisheng0.7619477780.7018368440.731892311SAM0.6719263360.6597005130.665813424Shanhe Pharmacy0.7347913490.6502211860.692506268Shkb0.6980695210.6803878760.689228698Shanghai RAAS Blood Products0.6764073780.6055619280.640984653Shenqi0.6465891050.5819697420.614279423Biological Stock0.7602029810.7560429240.758122952Salvage Pharm0.4631448720.5024136140.482779243Sts0.7397815670.6891492440.714465406Scyy0.6999668110.6033802820.651673546Beijing SL Pharm0.7737606540.688834420.731297537Stellite0.6677601490.6427020480.655231099Shsw0.736920570.6572038640.697062217Tat0.602650230.5446972590.573673745Taiji Group0.3992796710.4985186250.448899148Taloph Pharm0.619242550.6444346230.631838587Teyi0.6986673830.667166840.682917112Tasly0.416668530.6302754870.523472009Tiantan Biological0.7330106680.6576003280.695305498Tianyao Pharm0.6462400880.6131433570.629691722Thdb0.778833260.7065397640.742686512Thjm0.5678091630.5643867420.566097953TRT0.4996285210.6916214040.595624963Wanbangde0.4274068520.5379926790.482699766Wondfo0.7150095550.6317988680.673404211WEDGE INDUSTRIAL0.7361843080.6433554390.689769873Weiming0.7118260160.6503218290.681073922Wowu0.7705670210.6758403620.723203692Wohua0.7039033920.6611881320.682545762Wosen0.6719124770.5529041430.61240831AMD0.7509457810.610523090.680734436Xianju Pharm0.6098038780.6075172620.60866057Xiangxue Pharm0.568372510.5377400930.553056301Sunflower0.558410590.5666836920.562547141NHU0.6326549790.41225080.52245289Xinhua0.4889473770.5567670520.522857214Xinbang0.4402032470.3950792860.417641267SALUBRIS0.7152400780.630262920.672751499BROTHER0.6975948710.6215536040.659574237Yabao0.5580604630.5670984430.562579453Yatai0.594686080.5686730890.581679584Yananbikang0.5850800920.5033401820.544210137Yiling Pharm0.5918149930.6352128970.613513945Yifan0.6598800290.6090508790.634465454Yibai0.5640933230.4373306990.500712011Yisheng0.6616469270.6037370310.632691979Yiduoli0.6480993840.5976238450.622861614Chinataurine0.6928811080.6473704140.670125761Gloria Pharm0.4797399630.4332187530.456479358Baiyao0.503625580.8191774690.661401524Zhejiang Medicine0.5008731090.5153435680.508108338Zhenbao Island0.664680480.4947830020.579731741zdzy0.5689093210.5617124430.565310882Zhifei0.8210438440.7835855990.802314721Zhongguancun0.6032265180.5469173390.575071929China Medicine0.3260221750.6199022350.472962205Zhongheng Group0.6993364930.7164319820.707884238Zhongmu0.5340610490.6252195520.579640301Zhongxin0.5236562260.647056750.585356488Zsyy0.7283083940.6119063740.670107384JLZX0.700326430.5542901010.627308266Zuoli0.6584877790.4921436860.575315732Five securities companies, Adisseo, Changchun High-Tech, Hualan Biological Engineering, Hengrui, and Zhifei, have achieved technology effectiveness in some years. Adisseo’s technical efficiency is effective in 2016 and has dropped significantly after 2016, and the technical efficiency can be improved by referring to the operation method of 2016 when the technology is effective (see Table3 for specific annual data).Table 3
Analysis of DEA efficiency in the first stage of Chinese pharmaceutical companies.
Company nameYear2015-20162016-20172017-20182018-2019Adisseo10.5388263770.7487696220.639633789Anke Bio0.698938920.7316204950.6711131970.703361568Osaikon0.7130773610.756737850.8133390880.817531461Baiyunshan0.3285421110.3563205230.5465070450.303672764Bdyy0.5897612320.628838860.5923204920.673332429Beilu0.7011529730.7699646230.7185344930.832174827Porton0.6175094150.6220153190.6063509450.659897114None0.7095275870.7498396740.6806415170.692813179Changchun High-Tech0.6442389010.6938758560.6784457111Changjiang Runfa Medicine0.6610739210.6338585320.5776282410.617216502Changshan Pharma0.7025744350.7374444560.6548969140.726604025DAJY0.6080341810.6125626730.5656494460.659420187Dezhan0.7782480140.88597130.8011729530.735162569Jiao0.6958760140.7525551960.7846275330.519464099DBBT0.6984274020.7329104560.6837998710.747814366VC0.3567469510.3696051750.5966200540.529513216Dongcheng0.6852985290.7133563570.652240540.644469293Nhwa Pharm0.5660507440.5958888790.5596296120.90136936Ekzy0.6958931350.6421426880.561110620.817019263Fangsheng0.6904306350.70723660.6682348420.734875807Fengyuan0.5079540550.5133820480.5003125290.803668528Fczy0.6733187220.7065597340.6372875490.694993671Fayy0.6401991620.6228825810.474879850.853112289Fosun Pharm0.4408291610.4531778320.4916471360.49307564Fuxiang0.695091720.7133198610.6553176770.733133012Guangji0.6658758450.6854651310.6665093770.727816419Kwong Sang Hong0.7312119490.7581188760.7035989270.767034517Guang Yuyuan0.7057274470.7288027560.6726831650.684002357Lark0.5920698790.6076908080.5481446010.77362057Glsj0.6460763120.702916050.6426426340.716848951Sinopharm Hyundai0.5505003140.319274420.5867020330.528408978Harbin Pharm0.2329040040.2397505040.4522435840.452259029Haili Bio0.7209588250.7557240920.6833838260.751465636Hnhy0.5937232490.6156636810.5339027850.696645384Hepalink0.6136246890.5949133190.5650386310.802005999Haishun New Pharma0.7308584790.7705998060.713685730.788569679Haisco0.6949507190.6896407950.6277248180.86949045Hisoar0.5361605140.5983451450.580534810.867138023Haixin0.5989218520.6516766240.604134510.655663364Hisun0.2794623810.2912529820.3969708050.446155807Han Sen Pharm0.6226411450.6703382490.6382640520.743867561Hybio0.7069900210.7620957360.5698158410.505230747Hengrui0.6599088760.69005323311Chase Sun0.5906167290.5463918650.4850560580.568871023NCPC0.2614786010.2732947640.4765316440.439081271Huahai0.5109397720.5329789020.4224502720.70961269Hualan Bio0.7244890530.759038680.748197121Huaren0.5478119230.606553410.5730184290.653930126HRSJ0.4218067480.4247801280.6423461210.678166446China Resources Double-Crane0.3963382040.4120179520.7462953590.717503796Huashen Technology0.6922828970.7486442240.6731213940.762749156Walter Dyne0.649057810.6873201560.6043319680.717676209Yanbian FC0.7284347350.7963582270.6229735960.964802474Kyrgyzstan0.6906485630.7237214350.6765582690.315539437Jichuan0.6545934030.6877524640.6589171810.733965769Jimin0.6672073120.7152031450.6390620340.703268743JYPC0.6761634290.6605518780.6745643380.730972038Joincare Pharm0.426099370.7795567090.420131060.814542688Jiangzhong0.5779830920.6602344970.6217714610.710282338Jincheng0.6043499750.6356280240.5403280790.778835478Jinhe Bio0.6204884570.6223158270.5931638620.657450163Jinling0.4576936470.4644854340.4853000030.77746379Jinshiya0.7395794610.7948848420.6420739720.686648392Jingxin0.6150130470.6453711620.6008493030.881618128Jinghua0.6542920460.6957230850.6449251340.552839647Jingfeng0.6554708790.6251557810.561687050.583642128Jiuqiang0.7755370260.805767690.7413535970.825166597Jiuzhitang0.6384322510.6323456930.5268163110.783209851Jiuzhou0.5311299290.5630826830.5532271640.866828683CONBA0.4249595720.4480919240.763183620.539210385Kanghong0.6496789020.6769134820.6178013130.716586348Kangyuan0.5471736590.5384124050.5219744360.84900766Kangzhi0.6814598750.7188562050.6585834090.68036486KHB0.6799092010.706015260.6462197810.879761787Kelun0.3094400680.3066321610.4813700930.417755441Sunflower0.5034686250.5427127140.5411647650.637334286Kunming Pharm0.4877527660.4945924690.4567842070.698168222Lummy0.594773780.6501483250.6201394760.63516333LAYN0.7066662810.7642503450.6584840630.757057246Lisheng Pharma0.6523582130.6582255850.6338026480.685028972Livzon Pharm0.4831278880.901473950.7658543450.719069177LEADMAN0.6852778680.7396936090.6854796690.749326011Lianhuan Pharm0.6725992940.7117572690.6701595410.741037539Lingkang0.6989029050.7434022310.6965862790.764084079Lingrui Pharm0.6744016360.6723890240.6149061340.706294196Long Jin Pharm0.7318451120.7704524440.7187670220.793216512Lukang Pharm0.4274684860.465706820.4603327690.682602477Mike Bio0.7080274830.723198520.6451497420.893314305M.k.0.7083959240.7264829260.568737590.613265307Palin Bio0.6713913140.7181819860.6664252420.757080803PIEN TZE HUANG0.6849306110.7504056590.6610391960.958922766Julie Plec0.7077043290.7237140450.6734627260.733615566Plyy0.4069597480.4148537780.4277358390.708905869CHEEZHENGTTM0.6866829510.7251353570.6782378650.768703082Qidi0.6668065470.682369240.644983980.770055989Qianhong Biopharma0.719386820.7193850250.6565600980.713796618Qianjin Pharm0.5306567910.5486290690.5227137540.848589111Qianyuan0.6385064670.6715433680.627910260.721933561Renfu0.3342188030.4132727440.1492314870.392902669Renhe Pharmacy0.5332684790.5069148130.5199994970.8252231Rpsw0.6380390280.6549743980.6178454970.693808777Saisheng0.7544733920.7967484890.727706480.76886275SAM0.6809094310.6895983580.5940206140.72317694Shanhe Pharmacy0.7132629810.7477558430.7012916180.776854953Shkb0.6906136540.7210269370.6553619280.725275566Shanghai RAAS Blood Products0.8159372160.7116329660.295122330.882937Shenqi0.6465158920.6651229010.6049057170.669811909Biological Stock0.7763003640.8577319610.7333105110.673469086Salvage Pharm0.4054239810.4711474110.5705804080.405427689Sts0.7453428680.7898095760.6959434430.728030381Scyy0.6213249920.7366247640.670142760.771774728Beijing SL Pharm0.7549595690.8224792510.7390666370.778537157Stellite0.646998610.6797910020.6487082420.695542742Shsw0.7064906880.7490479720.7018121010.790331518Tat0.5833020350.5798028330.5306127460.716883304Taiji Group0.3686979530.2883734470.5055066690.434540617Taloph Pharm0.605054210.6447078820.5694537810.657754327Teyi0.6856393880.7101370440.6673097160.731583384Tasly0.3447363230.3643982460.5475079610.410031592Tiantan Biological0.566854930.7351396850.7055972370.924450822Tianyao Pharm0.5677840750.6401007990.5683663280.808709151Thdb0.6904201520.760737240.6920586340.972117015Thjm0.7007593080.6820660650.620990780.2674205TRT0.4499416370.4525618560.5785653130.517445278Wanbangde0.3503981530.4108983120.4645474950.483783447Wondfo0.7060339330.7491632590.6663774870.738463539WEDGE INDUSTRIAL0.7180411810.7683976980.6902601110.76803824Weiming0.7481770090.7691283210.6198534860.710145248Wowu0.7392984510.7842439220.73861250.820113211Wohua0.6743229380.7101570450.6590120710.772121516Wosen0.6193034120.5714918750.7973938210.699460802AMD0.6899665690.7899412630.713295270.810580022Xianju Pharm0.5144648570.5664906220.5401095860.818150446Xiangxue Pharm0.5377836670.5400686230.4812752330.714362519Sunflower0.5400295230.5989986320.3885320540.706082152NHU0.5176920550.6038835170.660537920.748506424Xinhua0.4021098630.4301563220.4371749290.686348395Xinbang0.430116240.4288081920.3612372550.540651302SALUBRIS0.7448816150.7792941360.6976514880.639133074BROTHER0.6633838530.7195289770.5835981780.823868476Yabao0.4534187060.5079143920.5150889770.755819777Yatai0.6876246160.7234979460.6586610440.308960713Yananbikang0.6150882740.5986679780.635097450.491466664Yiling Pharm0.5353998970.546293010.5210046940.764562368Yifan0.621372480.7061452320.5434275560.768574846Yibai0.6018199830.5832459520.3444749020.726832453Yisheng0.6407080570.6792030140.6235393810.703137255Yiduoli0.618786470.6010978540.5669682910.80554492Chinataurine0.653922480.7158652760.6745135720.727223103Gloria Pharm0.6198024620.5831614650.5347497760.181246147Baiyao0.4077032920.4153258320.5986832780.592789916Zhejiang Medicine0.396941490.3939987310.6274378980.585114319Zhenbao Island0.6156370110.6304671450.5654641870.847153576Zdzy0.539305680.5415024350.4472816590.74754751Zhifei0.6590112630.7793839240.845780191Zhongguancun0.6079849420.5976610570.5591899380.648070137China Medicine0.2982937190.2843217850.3893965590.332076638Zhongheng Group0.65833690.7308237380.6608844530.747300882Zhongmu0.466975420.5057017280.4807530410.682814008Zhongxin0.4258699970.4786045660.4753363450.714813998Zsyy0.6722847420.7218394710.641258140.877851223JLZX0.6580452750.7247155090.5966661890.821878746Zuoli0.6470506890.6671067220.6163724590.703421246


### 4.4. DEA Efficiency Analysis in the Second Stage

In the second stage (shown in Table2), there is no company that has reached technical efficiency of 1 during 2015–2019, indicating that all the companies were not effective. There are 97 companies with a technical efficiency value of 0.6–1.0, accounting for 59.5%, which is significantly lower than the first stage. Only 3 companies had technical efficiency below 0.4 (Sinopharm, Xinbang, and Baiyunshan). The technical efficiency in second stage is generally low, but companies with lower efficiency have been promoted, which may be correlated with government subsidies.Adisseo, Dezhan Health, Jiao, Hengrui, Livzon Group, Shanghai RAAS, and Zhifei Biotechnology have achieved technical efficiency of 1 in some years. And Adisseo is the same as the first stage, the technical efficiency is effective in 2016 and has dropped dramatically after 2016. The technical efficiency of Dezhan Health and Jiao pharmaceutical companies in the second stage has increased; we believe that the first stage is relevant to the second stage in these companies. However, the average technical efficiency of Hualan Biological is below 0.6 in the two stages, for the resources cannot be well utilized (see Table4 for specific annual data).Table 4
Analysis of DEA efficiency in the second stage of Chinese pharmaceutical companies.
Company nameYear2015-20162016-20172017-20182018-2019Adisseo10.6498375450.6257374310.541530825Anke Bio0.7651620260.4761890620.7722551490.613658522Osaikon0.8437780660.4414459850.8507807310.575021161Baiyunshan0.1280297310.3384728090.446815410.404956323Bdyy0.8908343950.4452227540.7276765090.608956969Beilu0.8085449910.4477814740.7352022660.658558851Porton0.7906068560.4528643560.7411518930.630953461None0.8995533520.4122247690.6921647380.575225616Changchun High-Tech0.6973316340.5340868020.9742107310.83805388Changjiang Runfa Medicine0.7582782020.4572085970.7571782280.355161748Changshan Pharma0.8394309130.4522683920.7229494260.63821128DAJY0.4987498120.4530467710.7360621020.592503277Dezhan10.5401445160.9073256080.65741689Jiao10.69565735510.349390869DBBT0.791609790.4438872790.7254361610.605439407VC0.521766850.4525604750.49232620.401474275Dongcheng0.8756323340.4569548620.7686388570.621583435Nhwa Pharm0.9026855340.4811017410.8125063470.47310525Ekzy0.6639656940.4921396530.7415891750.417137904Fangsheng0.837283480.4459126680.7294483770.613888946Fengyuan0.3817007720.4482481780.7292552550.408521314Fczy0.8108294550.4503230960.7336124140.613158813Fayy0.8538510880.4626521380.6266760330.430608438Fosun Pharm0.4058795890.8876084740.8630396040.822061518Fuxiang0.6861479370.403026210.659687930.652530008Guangji0.7817837440.4388624220.7281055840.614602675Kwong Sang Hong0.8336008980.4452354210.7218736050.602632782Guang Yuyuan0.8735446330.4671737160.789871180.443703159Lark0.8563597230.5073552750.8345416430.432730249Glsj0.7628644980.4989327750.8024015530.666986138Sinopharm Hyundai0.3043264410.4678727650.5226099030.295245894Harbin Pharm0.4719078320.4989279740.518929830.413398936Haili Bio0.8459815940.4529635860.7157619690.596021344Hnhy0.5461322860.4512090710.739299060.377683569Hepalink0.5706928290.4557735860.8337482270.517400795Haishun New Pharma0.8751911210.4412839290.7185837190.61164409Haisco0.2652477590.4620945740.7704046380.453228976Hisoar0.8067776930.4837330430.8412845760.486621529Haixin0.8695993120.451220250.7488380020.618733421Hisun0.2953306770.4699350510.4346721280.436124359Han Sen Pharm0.8427922740.4490549270.7392697820.624481603Hybio0.7411908630.4821594270.649406530.450484128Hengrui0.9940066190.85120433511Chase Sun0.5109347680.2529636320.3881831450.487982456NCPC0.4469581380.4428936230.4850195120.416336438Huahai0.4836314190.5178198760.7445625470.468120819Hualan Bio0.4880186880.4632751330.8251558670.606937968Huaren0.8583224420.4459579890.726142990.608155932HRSJ0.390559960.6062967310.6598274560.641018804China Resources Double-Crane0.5320238860.5442029860.5886791290.519985Huashen Technology0.8994237230.4618629090.7239069590.610948685Walter Dyne0.8425026960.4972427210.7671432010.641896259Yanbian FC0.4426233860.6573294080.8878159630.555869763Kyrgyzstan0.4551808570.4668361490.7630562610.299038639Jichuan0.6924560780.2690194830.4808911910.509052877Jimin0.8431759820.4472301930.725934010.612949828JYPC0.9022645040.4057529650.7107645030.579782874Joincare Pharm0.3206793440.4460191870.4423653250.607505328Jiangzhong0.9685781560.4889101630.8069956810.681786657Jincheng0.6805876260.4468837250.7264634330.422778688Jinhe Bio0.7675559710.4548008530.7518967260.621861095Jinling0.8821518040.4626325320.7771498180.420373223Jinshiya0.8188249750.4303377380.7080294090.621839405Jingxin0.7542717860.39972610.6690112250.458543459Jinghua0.8188964140.464798970.7713051730.511596589Jingfeng0.6596288370.4625869120.7562454340.295660795Jiuqiang0.8888000590.4751141260.7795411590.656729486Jiuzhitang0.6829395940.3883852960.5762211750.418866032Jiuzhou0.700683030.4593764940.750175960.426386203CONBA0.4508403670.5320075340.5721598010.36900969Kanghong0.6308619170.3838742540.6329104240.462196751Kangyuan0.5698894620.4838125620.8000758310.457930115Kangzhi0.8604485120.4470777290.7228074240.595329819KHB0.758740450.4462622530.7318655530.430496937Kelun0.3921925540.4918780680.5739393150.514916857Sunflower0.3970694080.4022218670.6777471890.568562512Kunming Pharm0.4847125390.4828525570.7878632720.452428396Lummy0.7575919110.4460242940.7356994240.57313539LAYN0.826164770.466737080.7350881040.618275961Lisheng Pharma0.8922898980.448238650.7437826060.632397402Livzon Pharm0.33047651910.6212691090.563738749LEADMAN0.7444911320.4396741970.7085872780.605240773Lianhuan Pharm0.8833816640.4498826860.7335903380.614613785Lingkang0.4873426480.4611473150.7556094230.634678684Lingrui Pharm0.8205702940.4691082870.7684032760.650201258Long Jin Pharm0.8252695050.4454742960.72134830.596440566Lukang Pharm0.7093075440.2719677640.4484059640.41417971Mike Bio0.8296724910.4919635440.8165164520.463478288M.k.0.7025401710.4617985680.7505047230.334581671Palin Bio0.8003666880.442994070.7337465580.627260125PIEN TZE HUANG0.90453430.5382908450.9475361740.513658965Julie Plec0.5495210850.3051118150.4999393270.524584684Plyy0.5334028940.4219727280.7080182130.458768245CHEEZHENGTTM0.5651486590.4654294480.7614718670.662280612Qidi0.861178920.4415271530.7095082070.607695056Qianhong Biopharma0.8746060480.4563155370.7505635730.635328671Qianjin Pharm0.7392461080.4718145040.7799248670.439377818Qianyuan0.8313389850.4045752770.6551546680.336313058Renfu0.3344142050.6180459990.1760554830.552146513Renhe Pharmacy0.8881118730.4960370760.8370408150.469528713Rpsw0.5943945680.4338808690.7099304870.626972475Saisheng0.9296829340.4761577780.775990030.625516632SAM0.9052646820.4511502870.6805558610.60183122Shanhe Pharmacy0.8479248440.4329281460.7100087650.610022991Shkb0.8480897110.4714991570.7589092870.643053348Shanghai RAAS Blood Products10.544708280.4095203540.468019077Shenqi0.7147620960.3813445610.6176130410.61415927Biological Stock0.9653593570.5492231790.8706204830.638968678Salvage Pharm0.6893644330.4153082010.7067494770.198232344Sts0.9357575170.4721413330.743570520.605127606Scyy0.7391535330.4264859930.6764147710.571466831Beijing SL Pharm0.7337499390.5069477810.8328428480.681797114Stellite0.8033788960.4373709930.7152512620.614807042Shsw0.8904106160.4347617690.7001775970.603465476Tat0.8425862940.3608079230.5848232440.390571577Taiji Group0.679199530.4529807770.4740015410.387892653Taloph Pharm0.8426368240.4382247810.6891615250.607715363Teyi0.8363586940.4536820770.7490143520.629612238Tasly0.7172991630.6157350650.6752241490.512843572Tiantan Biological0.6786135590.5910612540.8602467740.500479724Tianyao Pharm0.8576771160.4483939480.7372409470.409261416Thdb0.9006881310.5457224150.8887417770.491006733Thjm0.7449761470.473113690.7853343150.254122817TRT0.8361779720.6561516090.7035607230.570595311Wanbangde0.7928518610.4536006640.4823064060.423211786Wondfo0.7182341540.4236541280.7123946550.672912535WEDGE INDUSTRIAL0.786233380.4507056670.7271736660.609309043Weiming0.8018467210.4890195590.6975306620.612890373Wowu0.9151782810.4442288650.7325301560.611424148Wohua0.8499510670.4511581650.7266572430.616986053Wosen0.2935388340.368962970.9275819150.621532855AMD0.5657896970.466053090.7559410060.654308568Xianju Pharm0.7221298260.469752240.7886108220.449576159Xiangxue Pharm0.565944130.4502466090.7286015950.406168036Sunflower0.7757272470.4351194950.4726275810.583260445NHU0.7444461920.0847924090.1745175150.645247085Xinhua0.6861500260.4185801310.6914756440.430862405Xinbang0.371466410.4823792560.297065990.42940549SALUBRIS0.8289506890.455146340.7440677550.492886897BROTHER0.8673615670.4912909660.7229691930.404592688Yabao0.625382230.4659814240.7761641460.400865973Yatai0.7918699110.4585799050.7494885010.274754037Yananbikang0.6095922910.5257548390.4958899030.382123694Yiling Pharm0.7321997420.5057486710.835209040.467694136Yifan0.8953803660.4281631950.6144912150.498168738Yibai0.6228202740.327751120.3862509870.412500415Yisheng0.6158185610.4502338590.7338561060.615039599Yiduoli0.7683702150.4541516980.7490928340.418880633Chinataurine0.7905722540.4454969580.7347871510.618625291Gloria Pharm0.4253751380.4730218260.7351987570.099279291Baiyao0.6764208970.8312255190.8985342610.870529199Zhejiang Medicine0.6489776210.4709282380.5088772620.43259115Zhenbao Island0.3667142140.447969520.7190058350.445442437Zdzy0.6664627770.4772720750.6880043430.415110578Zhifei0.7943125610.4885837410.851446092Zhongguancun0.6384314870.3610484750.6008297230.58735967China Medicine0.6003856610.6329357670.7050127280.541274783Zhongheng Group0.7794883370.5164317250.8429807720.726827094Zhongmu0.8917914260.4615958810.7586295870.388861314Zhongxin0.7842991660.5000359960.8337342880.470157549Zsyy0.7122365560.4937766550.8058818330.435730452JLZX0.568394670.4873518220.75384120.407572713Zuoli0.5068306350.3278428370.5300452260.603856046


### 4.5. Overall Efficiency Analysis

In the overall efficiency analysis (shown in Table2), there are 109 companies with efficiency between 0.6 and 1.0, accounting for 66.9%, and it shows that the technical efficiency of the second stage is less than that of the first stage.Comparing Hengrui (the highest efficiency) and Baiyunshan (the lowest efficiency), we found that Hengrui did not receive government subsidies in the 2018 and 2019, but the technical efficiency reached 1, and Baiyunshan has received government subsidies, but the technical efficiency rises first and then decreases.For Zhifei Bio with the second highest efficiency, its efficiency in 2018 and 2019 was significantly higher than in 2016 and 2017, and the government subsidies received by Zhifei Bio in 2018 and 2019 were significantly lower than before. The second-to-last-ranked company, Medicare, reached a low point in 2018, followed by a significant rebound next year, when it was not subsidized by the government in 2019.It can be concluded that government subsidies have no obvious effect for most companies, but it has a positive impact on enterprises with low efficiency in a short term. The government may need to reconsider the way of subsidies to pharmaceutical companies, such as the capital subsidies to equipment upgrades and talent introduction (see Table5 for specific annual data).Table 5
Analysis of the overall efficiency of Chinese pharmaceutical companies.
Company nameYear2015-20162016-20172017-20182018-2019Adisseo10.5943319610.6872535270.590582307Anke Bio0.7320504730.6039047780.7216841730.658510045Osaikon0.7784277130.5990919170.8320599090.696276311Baiyunshan0.2282859210.3473966660.4966612280.354314544Bdyy0.7402978130.5370308070.65999850.641144699Beilu0.7548489820.6088730490.7268683790.745366839Porton0.7040581350.5374398380.6737514190.645425288None0.8045404690.5810322220.6864031270.634019398Changchun High-Tech0.6707852680.6139813290.8263282210.91902694Changjiang Runfa Medicine0.7096760620.5455335640.6674032350.486189125Changshan Pharma0.7710026740.5948564240.688923170.682407653DAJY0.5533919960.5328047220.6508557740.625961732Dezhan0.8891240070.7130579080.854249280.696289729Jiao0.8479380070.7241062760.8923137670.434427484DBBT0.7450185960.5883988670.7046180160.676626886VC0.43925690.4110828250.5444731270.465493745Dongcheng0.7804654310.585155610.7104396980.633026364Nhwa Pharm0.7343681390.538495310.6860679790.687237305Ekzy0.6799294150.5671411710.6513498980.617078583Fangsheng0.7638570570.5765746340.698841610.674382377Fengyuan0.4448274140.4808151130.6147838920.606094921Fczy0.7420740880.5784414150.6854499820.654076242Fayy0.7470251250.5427673590.5507779410.641860364Fosun Pharm0.4233543750.6703931530.677343370.657568579Fuxiang0.6906198280.5581730350.6575028030.69283151Guangji0.7238297950.5621637760.6973074810.671209547Kwong Sang Hong0.7824064230.6016771490.7127362660.684833649Guang Yuyuan0.789636040.5979882360.7312771720.563852758Lark0.7242148010.5575230410.6913431220.603175409Glsj0.7044704050.6009244120.7225220940.691917544Sinopharm Hyundai0.4274133770.3935735920.5546559680.411827436Harbin Pharm0.3524059180.3693392390.4855867070.432828982Haili Bio0.7834702090.6043438390.6995728980.67374349Hnhy0.5699277670.5334363760.6366009220.537164476Hepalink0.5921587590.5253434520.6993934290.659703397Haishun New Pharma0.80302480.6059418680.7161347250.700106885Haisco0.4800992390.5758676850.6990647280.661359713Hisoar0.6714691030.5410390940.7109096930.676879776Haixin0.7342605820.5514484370.6764862560.637198392Hisun0.2873965290.3805940160.4158214670.441140083Han Sen Pharm0.7327167090.5596965880.6887669170.684174582Hybio0.7240904420.6221275820.6096111850.477857438Hengrui0.8269577480.77062878411Chase Sun0.5507757480.3996777490.4366196020.528426739NCPC0.3542183690.3580941940.4807755780.427708854Huahai0.4972855950.5253993890.583506410.588866754Hualan Bio0.6062538710.6111569060.7866764930.803468984Huaren0.7030671830.52625570.6495807090.631043029HRSJ0.4061833540.515538430.6510867890.659592625China Resources Double-Crane0.4641810450.4781104690.6674872440.618744398Huashen Technology0.795853310.6052535660.6985141760.686848921Walter Dyne0.7457802530.5922814380.6857375850.679786234Yanbian FC0.585529060.7268438180.755394780.760336119Kyrgyzstan0.572914710.5952787920.7198072650.307289038Jichuan0.6735247410.4783859740.5699041860.621509323Jimin0.7551916470.5812166690.6824980220.658109286JYPC0.7892139670.5331524210.6926644210.655377456Joincare Pharm0.3733893570.6127879480.4312481920.711024008Jiangzhong0.7732806240.574572330.7143835710.696034497Jincheng0.64246880.5412558740.6333957560.600807083Jinhe Bio0.6940222140.538558340.6725302940.639655629Jinling0.6699227260.4635589830.631224910.598918507Jinshiya0.7792022180.612611290.675051690.654243898Jingxin0.6846424160.5225486310.6349302640.670080794Jinghua0.736594230.5802610280.7081151530.532218118Jingfeng0.6575498580.5438713460.6589662420.439651462Jiuqiang0.8321685430.6404409080.7604473780.740948042Jiuzhitang0.6606859220.5103654950.5515187430.601037942Jiuzhou0.6159064790.5112295880.6517015620.646607443CONBA0.437899970.4900497290.6676717110.454110037Kanghong0.6402704090.5303938680.6253558680.589391549Kangyuan0.5585315610.5111124830.6610251340.653468887Kangzhi0.7709541930.5829669670.6906954160.63784734KHB0.7193248250.5761387570.6890426670.655129362Kelun0.3508163110.3992551140.5276547040.466336149Sunflower0.4502690170.472467290.6094559770.602948399Kunming Pharm0.4862326520.4887225130.6223237390.575298309Lummy0.6761828460.5480863090.677919450.60414936LAYN0.7664155260.6154937130.6967860830.687666604Lisheng Pharma0.7723240560.5532321180.6887926270.658713187Livzon Pharm0.4068022040.9507369750.6935617270.641403963LEADMAN0.71488450.5896839030.6970334740.677283392Lianhuan Pharm0.7779904790.5808199770.701874940.677825662Lingkang0.5931227770.6022747730.7260978510.699381382Lingrui Pharm0.7474859650.5707486550.6916547050.678247727Long Jin Pharm0.7785573080.607963370.7200576610.694828539Lukang Pharm0.5683880150.3688372920.4543693660.548391093Mike Bio0.7688499870.6075810320.7308330970.678396297M.k.0.7054680470.5941407470.6596211570.473923489Palin Bio0.7358790010.5805880280.70008590.692170464PIEN TZE HUANG0.7947324550.6443482520.8042876850.736290866Julie Plec0.6286127070.514412930.5867010260.629100125Plyy0.4701813210.4184132530.5678770260.583837057CHEEZHENGTTM0.6259158050.5952824020.7198548660.715491847Qidi0.7639927330.5619481960.6772460940.688875522Qianhong Biopharma0.7969964340.5878502810.7035618360.674562645Qianjin Pharm0.6349514490.5102217870.6513193110.643983464Qianyuan0.7349227260.5380593220.6415324640.529123309Renfu0.3343165040.5156593710.1626434850.472524591Renhe Pharmacy0.7106901760.5014759440.6785201560.647375907Rpsw0.6162167980.5444276340.6638879920.660390626Saisheng0.8420781630.6364531340.7518482550.697189691SAM0.7930870560.5703743230.6372882380.66250408Shanhe Pharmacy0.7805939120.5903419940.7056501920.693438972Shkb0.7693516820.5962630470.7071356070.684164457Shanghai RAAS Blood Products0.9079686080.6281706230.3523213420.675478039Shenqi0.6806389940.5232337310.6112593790.641985589Biological Stock0.8708298610.703477570.8019654970.656218882Salvage Pharm0.5473942070.4432278060.6386649430.301830016Sts0.8405501920.6309754550.7197569820.666578994Scyy0.6802392630.5815553780.6732787660.671620779Beijing SL Pharm0.7443547540.6647135160.7859547430.730167136Stellite0.7251887530.5585809970.6819797520.655174892Shsw0.7984506520.5919048710.7009948490.696898497Tat0.7129441650.4703053780.5577179950.553727441Taiji Group0.5239487410.3706771120.4897541050.411216635Taloph Pharm0.7238455170.5414663310.6293076530.632734845Teyi0.7609990410.5819095610.7081620340.680597811Tasly0.5310177430.4900666560.6113660550.461437582Tiantan Biological0.6227342440.663100470.7829220060.712465273Tianyao Pharm0.7127305960.5442473730.6528036370.608985283Thdb0.7955541420.6532298280.7904002060.731561874Thjm0.7228677280.5775898770.7031625470.260771659TRT0.6430598050.5543567330.6410630180.544020294Wanbangde0.5716250070.4322494880.4734269510.453497617Wondfo0.7121340430.5864086940.6893860710.705688037WEDGE INDUSTRIAL0.752137280.6095516830.7087168890.688673642Weiming0.7750118650.629073940.6586920740.661517811Wowu0.8272383660.6142363940.7355713280.715768679Wohua0.7621370030.5806576050.6928346570.694553785Wosen0.4564211230.4702274220.8624878680.660496829AMD0.6278781330.6279971770.7346181380.732444295Xianju Pharm0.6182973410.5181214310.6643602040.633863302Xiangxue Pharm0.5518638990.4951576160.6049384140.560265277Sunflower0.6578783850.5170590630.4305798180.644671298NHU0.6310691240.3443379630.4175277170.696876755Xinhua0.5441299450.4243682260.5643252860.5586054Xinbang0.4007913250.4555937240.3291516230.485028396SALUBRIS0.7869161520.6172202380.7208596220.566009985BROTHER0.765372710.6054099710.6532836860.614230582Yabao0.5394004680.4869479080.6456265610.578342875Yatai0.7397472640.5910389260.7040747720.291857375Yananbikang0.6123402830.5622114090.5654936760.436795179Yiling Pharm0.6337998190.5260208410.6781068670.616128252Yifan0.7583764230.5671542140.5789593850.633371792Yibai0.6123201290.4554985360.3653629450.569666434Yisheng0.6282633090.5647184370.6786977440.659088427Yiduoli0.6935783420.5276247760.6580305620.612212776Chinataurine0.7222473670.5806811170.7046503620.672924197Gloria Pharm0.52258880.5280916460.6349742660.140262719Baiyao0.5420620950.6232756760.748608770.731659557Zhejiang Medicine0.5229595550.4324634840.568157580.508852734Zhenbao Island0.4911756120.5392183320.6422350110.646298006Zdzy0.6028842280.5093872550.5676430010.581329044Zhifei0.7266619120.6339838320.9228900950.925723046Zhongguancun0.6232082150.4793547660.580009830.617714904China Medicine0.449339690.4586287760.5472046430.43667571Zhongheng Group0.7189126180.6236277310.7519326120.737063988Zhongmu0.6793834230.4836488040.6196913140.535837661Zhongxin0.6050845810.4893202810.6545353160.592485773Zsyy0.6922606490.6078080630.7235699870.656790838JLZX0.6132199720.6060336660.6752536940.61472573Zuoli0.5769406620.4974747790.5732088420.653638646


## 4.1. Sample Selection

With reference to the definition of pharmaceutical companies, combined with the description of the main business in the annual report of the A-share listed pharmaceutical company and the proportion of the main business in operating income, the study sample is determined. At the same time, to ensure the validity of the analysis results, ST, PT, andST∗ companies were excluded, and 164 listed pharmaceutical companies were finally identified as the research samples. The data of inputs and outputs comes from Cathay Pacific database and the annual public report of enterprise.


## 4.2. Variable Selection

### 4.2.1. The First Stage of Input and Output Variables

The selection of variables is based on character of listed pharmaceutical companies, and we fully inspect the business characteristics and operation of listed pharmaceutical companies. The inputs selected are gross costsX1, total number of employees X2, and net value of fixed assets X3, and the output is gross revenue Y1.


### 4.2.2. The Second Phase of Input and Output Variables

This paper comprehensively examines the business characteristics and operation of listed pharmaceutical companies. Government subsidiesX5 as a new input are added to the second stage, and the other input is the gross revenue X4 that is the output of first stage, and the final output is net profit Y2. More details are shown in Table 1.Table 1
Variable selection and measurement.
Variable typeVariable nameMeasureThe first stageOutputGross costsGross costs in corporate annual reportsInputTotal number of employeesTotal number of in-service staffNet value of fixed assetsNet value of fixed assets in corporate annual reportsGross revenueGross revenue in corporate annual reportsThe second stageOutputNet profitTotal profit − income taxInputGross costs—Government subsidiesGovernment subsidies that are included in the current profit and loss


## 4.2.1. The First Stage of Input and Output Variables

The selection of variables is based on character of listed pharmaceutical companies, and we fully inspect the business characteristics and operation of listed pharmaceutical companies. The inputs selected are gross costsX1, total number of employees X2, and net value of fixed assets X3, and the output is gross revenue Y1.


## 4.2.2. The Second Phase of Input and Output Variables

This paper comprehensively examines the business characteristics and operation of listed pharmaceutical companies. Government subsidiesX5 as a new input are added to the second stage, and the other input is the gross revenue X4 that is the output of first stage, and the final output is net profit Y2. More details are shown in Table 1.Table 1
Variable selection and measurement.
Variable typeVariable nameMeasureThe first stageOutputGross costsGross costs in corporate annual reportsInputTotal number of employeesTotal number of in-service staffNet value of fixed assetsNet value of fixed assets in corporate annual reportsGross revenueGross revenue in corporate annual reportsThe second stageOutputNet profitTotal profit − income taxInputGross costs—Government subsidiesGovernment subsidies that are included in the current profit and loss


## 4.3. DEA Efficiency Analysis in the First Stage

In first stage (shown in Table2), no listed pharmaceutical company’s technical efficiency reached 1 during 2015–2019. There are 119 companies with technical efficiency between 0.6 and 1.0, accounting for 73%, indicating that the technical efficiency of these companies is good. The efficiency values of the eight securities companies (Chongqing Taiji Industry, Baiyunshan, Kelun, Huabei, Hisun, Harbin, China Medicine, and Renfu) are below 0.4, indicating that the technical efficiency level of these companies is relatively low, and they need to increase investment.Table 2
Summary of means of technical efficiency.
Company nameThe first stageThe second stageTotalAdisseo0.7318074470.704276450.718041949Anke Bio0.7012585450.656816190.679037367Osaikon0.775171440.6777564860.726463963Baiyunshan0.3837606110.3295685680.35666459Bdyy0.6210632530.6681726570.644617955Beilu0.7554567290.6625218950.708989312Porton0.6264431980.6538941420.64016867None0.7082054890.6447921190.676498804Changchun High-Tech0.7541401170.7609207620.757530439Changjiang Runfa Medicine0.6224442990.5819566940.602200497Changshan Pharma0.7053799570.6632150030.68429748DAJY0.6114166220.5700904910.590753556Dezhan0.8001387090.7762217530.788180231Jiao0.688130710.7612620560.724696383DBBT0.7157380240.6415931590.678665591VC0.4631213490.467031950.465076649Dongcheng0.673841180.6807023720.677271776Nhwa Pharm0.6557346490.6673497180.661542183Ekzy0.6790414270.5787081060.628874767Fangsheng0.7001944710.6566333680.678413919Fengyuan0.581329290.491931380.536630335Fczy0.6780399190.6519809450.665010432Fayy0.647768470.5934469240.620607697Fosun Pharm0.4696824420.7446472960.607164869Fuxiang0.6992155670.6003480210.649781794Guangji0.6864166930.6408386060.66362765Kwong Sang Hong0.7399910670.6508356770.695413372Guang Yuyuan0.6978039310.6435731720.670688552Lark0.6303814640.6577467230.644064093Glsj0.6771209870.6827962410.679958614Sinopharm Hyundai0.4962214360.3975137510.446867593Harbin Pharm0.344289280.4757911430.410040211Haili Bio0.7278830950.6526821230.690282609Hnhy0.6099837750.5285809960.569282386Hepalink0.643895660.5944038590.619149759Haishun New Pharma0.7509284240.6616757150.706302069Haisco0.7204516960.4877439870.604097841Hisoar0.6455446230.654604210.650074417Haixin0.6275990870.6720977460.649848417Hisun0.3534604940.4090155540.381238024Han Sen Pharm0.6687777520.6638996460.666338699Hybio0.6360330860.5808102370.608421662Hengrui0.8374905270.9613027390.899396633Chase Sun0.5477339190.4100160.478874959NCPC0.362596570.4478019280.405199249Huahai0.5439954090.5535336650.548764537Hualan Bio0.8079312130.5958469140.701889064Huaren0.5953284720.6596448380.627486655HRSJ0.5417748610.5744257380.558100299China Resources Double-Crane0.5680388280.546222750.557130789Huashen Technology0.7191994180.6740355690.696617493Walter Dyne0.6645965360.6871962190.675896377Yanbian FC0.7781422580.635909630.707025944Kyrgyzstan0.6016169260.4960279760.548822451Jichuan0.6838072040.4878549070.585831056Jimin0.6811853090.6573225040.669253906JYPC0.6855629210.6496412110.667602066Joincare pharm0.6100824570.4541422960.532112376Jiangzhong0.6425678470.7365676640.689567756Jincheng0.6397853890.5691783680.604481878Jinhe Bio0.6233545770.6490286610.636191619Jinling0.5462357190.6355768440.590906281Jinshiya0.7157966670.6447578820.680277274Jingxin0.685712910.5703881420.628050526Jinghua0.6369449780.6416492870.639297132Jingfeng0.6064889590.5435304950.575009727Jiuqiang0.7869562280.7000462070.743501218Jiuzhitang0.6452010260.5166030240.580902025Jiuzhou0.6285671150.5841554220.606361268CONBA0.5438613750.4810043480.512432862Kanghong0.6652450110.5274608360.596352924Kangyuan0.614142040.5779269920.596034516Kangzhi0.6848160870.6564158710.670615979KHB0.7279765070.5918412980.659908903Kelun0.3787994410.4932316980.43601557Sunflower0.5561700970.5114002440.533785171Kunming Pharm0.5343244160.5519641910.543144303Lummy0.6250562280.6281127550.626584491LAYN0.7216144840.6615664790.691590481Lisheng Pharma0.6573538550.6791771390.668265497Livzon Pharm0.717381340.6288710940.673126217LEADMAN0.7149442890.6244983450.669721317Lianhuan pharm0.6988884110.6703671180.684627765Lingkang0.7257438740.5846945180.655219196Lingrui Pharm0.6669977470.6770707790.672034263Long jin Pharm0.7535702720.6471331660.700351719Lukang Pharm0.5090276380.4609652450.484996442Mike Bio0.7424225130.6504076940.696415103M.k.0.6542204370.5623562830.60828836Palin Bio0.7032698360.651091860.677180848PIEN TZE HUANG0.7638245580.7260050710.744914814Julie Plec0.7096241660.4697892280.589706697plyy0.4896138090.530540520.510077164CHEEZHENGTTM0.7146898140.6135826460.66413623Qidi0.6910539390.6549773340.673015636Qianhong Biopharma0.702282140.6792034570.690742799Qianjin Pharm0.6126471810.6075908240.610119003Qianyuan0.6649734140.5568454970.610909455Renfu0.3224064250.420165550.371285988Renhe Pharmacy0.5963514720.6726796190.634515546rpsw0.6511669250.59129460.621230762Saisheng0.7619477780.7018368440.731892311SAM0.6719263360.6597005130.665813424Shanhe Pharmacy0.7347913490.6502211860.692506268Shkb0.6980695210.6803878760.689228698Shanghai RAAS Blood Products0.6764073780.6055619280.640984653Shenqi0.6465891050.5819697420.614279423Biological Stock0.7602029810.7560429240.758122952Salvage Pharm0.4631448720.5024136140.482779243Sts0.7397815670.6891492440.714465406Scyy0.6999668110.6033802820.651673546Beijing SL Pharm0.7737606540.688834420.731297537Stellite0.6677601490.6427020480.655231099Shsw0.736920570.6572038640.697062217Tat0.602650230.5446972590.573673745Taiji Group0.3992796710.4985186250.448899148Taloph Pharm0.619242550.6444346230.631838587Teyi0.6986673830.667166840.682917112Tasly0.416668530.6302754870.523472009Tiantan Biological0.7330106680.6576003280.695305498Tianyao Pharm0.6462400880.6131433570.629691722Thdb0.778833260.7065397640.742686512Thjm0.5678091630.5643867420.566097953TRT0.4996285210.6916214040.595624963Wanbangde0.4274068520.5379926790.482699766Wondfo0.7150095550.6317988680.673404211WEDGE INDUSTRIAL0.7361843080.6433554390.689769873Weiming0.7118260160.6503218290.681073922Wowu0.7705670210.6758403620.723203692Wohua0.7039033920.6611881320.682545762Wosen0.6719124770.5529041430.61240831AMD0.7509457810.610523090.680734436Xianju Pharm0.6098038780.6075172620.60866057Xiangxue Pharm0.568372510.5377400930.553056301Sunflower0.558410590.5666836920.562547141NHU0.6326549790.41225080.52245289Xinhua0.4889473770.5567670520.522857214Xinbang0.4402032470.3950792860.417641267SALUBRIS0.7152400780.630262920.672751499BROTHER0.6975948710.6215536040.659574237Yabao0.5580604630.5670984430.562579453Yatai0.594686080.5686730890.581679584Yananbikang0.5850800920.5033401820.544210137Yiling Pharm0.5918149930.6352128970.613513945Yifan0.6598800290.6090508790.634465454Yibai0.5640933230.4373306990.500712011Yisheng0.6616469270.6037370310.632691979Yiduoli0.6480993840.5976238450.622861614Chinataurine0.6928811080.6473704140.670125761Gloria Pharm0.4797399630.4332187530.456479358Baiyao0.503625580.8191774690.661401524Zhejiang Medicine0.5008731090.5153435680.508108338Zhenbao Island0.664680480.4947830020.579731741zdzy0.5689093210.5617124430.565310882Zhifei0.8210438440.7835855990.802314721Zhongguancun0.6032265180.5469173390.575071929China Medicine0.3260221750.6199022350.472962205Zhongheng Group0.6993364930.7164319820.707884238Zhongmu0.5340610490.6252195520.579640301Zhongxin0.5236562260.647056750.585356488Zsyy0.7283083940.6119063740.670107384JLZX0.700326430.5542901010.627308266Zuoli0.6584877790.4921436860.575315732Five securities companies, Adisseo, Changchun High-Tech, Hualan Biological Engineering, Hengrui, and Zhifei, have achieved technology effectiveness in some years. Adisseo’s technical efficiency is effective in 2016 and has dropped significantly after 2016, and the technical efficiency can be improved by referring to the operation method of 2016 when the technology is effective (see Table3 for specific annual data).Table 3
Analysis of DEA efficiency in the first stage of Chinese pharmaceutical companies.
Company nameYear2015-20162016-20172017-20182018-2019Adisseo10.5388263770.7487696220.639633789Anke Bio0.698938920.7316204950.6711131970.703361568Osaikon0.7130773610.756737850.8133390880.817531461Baiyunshan0.3285421110.3563205230.5465070450.303672764Bdyy0.5897612320.628838860.5923204920.673332429Beilu0.7011529730.7699646230.7185344930.832174827Porton0.6175094150.6220153190.6063509450.659897114None0.7095275870.7498396740.6806415170.692813179Changchun High-Tech0.6442389010.6938758560.6784457111Changjiang Runfa Medicine0.6610739210.6338585320.5776282410.617216502Changshan Pharma0.7025744350.7374444560.6548969140.726604025DAJY0.6080341810.6125626730.5656494460.659420187Dezhan0.7782480140.88597130.8011729530.735162569Jiao0.6958760140.7525551960.7846275330.519464099DBBT0.6984274020.7329104560.6837998710.747814366VC0.3567469510.3696051750.5966200540.529513216Dongcheng0.6852985290.7133563570.652240540.644469293Nhwa Pharm0.5660507440.5958888790.5596296120.90136936Ekzy0.6958931350.6421426880.561110620.817019263Fangsheng0.6904306350.70723660.6682348420.734875807Fengyuan0.5079540550.5133820480.5003125290.803668528Fczy0.6733187220.7065597340.6372875490.694993671Fayy0.6401991620.6228825810.474879850.853112289Fosun Pharm0.4408291610.4531778320.4916471360.49307564Fuxiang0.695091720.7133198610.6553176770.733133012Guangji0.6658758450.6854651310.6665093770.727816419Kwong Sang Hong0.7312119490.7581188760.7035989270.767034517Guang Yuyuan0.7057274470.7288027560.6726831650.684002357Lark0.5920698790.6076908080.5481446010.77362057Glsj0.6460763120.702916050.6426426340.716848951Sinopharm Hyundai0.5505003140.319274420.5867020330.528408978Harbin Pharm0.2329040040.2397505040.4522435840.452259029Haili Bio0.7209588250.7557240920.6833838260.751465636Hnhy0.5937232490.6156636810.5339027850.696645384Hepalink0.6136246890.5949133190.5650386310.802005999Haishun New Pharma0.7308584790.7705998060.713685730.788569679Haisco0.6949507190.6896407950.6277248180.86949045Hisoar0.5361605140.5983451450.580534810.867138023Haixin0.5989218520.6516766240.604134510.655663364Hisun0.2794623810.2912529820.3969708050.446155807Han Sen Pharm0.6226411450.6703382490.6382640520.743867561Hybio0.7069900210.7620957360.5698158410.505230747Hengrui0.6599088760.69005323311Chase Sun0.5906167290.5463918650.4850560580.568871023NCPC0.2614786010.2732947640.4765316440.439081271Huahai0.5109397720.5329789020.4224502720.70961269Hualan Bio0.7244890530.759038680.748197121Huaren0.5478119230.606553410.5730184290.653930126HRSJ0.4218067480.4247801280.6423461210.678166446China Resources Double-Crane0.3963382040.4120179520.7462953590.717503796Huashen Technology0.6922828970.7486442240.6731213940.762749156Walter Dyne0.649057810.6873201560.6043319680.717676209Yanbian FC0.7284347350.7963582270.6229735960.964802474Kyrgyzstan0.6906485630.7237214350.6765582690.315539437Jichuan0.6545934030.6877524640.6589171810.733965769Jimin0.6672073120.7152031450.6390620340.703268743JYPC0.6761634290.6605518780.6745643380.730972038Joincare Pharm0.426099370.7795567090.420131060.814542688Jiangzhong0.5779830920.6602344970.6217714610.710282338Jincheng0.6043499750.6356280240.5403280790.778835478Jinhe Bio0.6204884570.6223158270.5931638620.657450163Jinling0.4576936470.4644854340.4853000030.77746379Jinshiya0.7395794610.7948848420.6420739720.686648392Jingxin0.6150130470.6453711620.6008493030.881618128Jinghua0.6542920460.6957230850.6449251340.552839647Jingfeng0.6554708790.6251557810.561687050.583642128Jiuqiang0.7755370260.805767690.7413535970.825166597Jiuzhitang0.6384322510.6323456930.5268163110.783209851Jiuzhou0.5311299290.5630826830.5532271640.866828683CONBA0.4249595720.4480919240.763183620.539210385Kanghong0.6496789020.6769134820.6178013130.716586348Kangyuan0.5471736590.5384124050.5219744360.84900766Kangzhi0.6814598750.7188562050.6585834090.68036486KHB0.6799092010.706015260.6462197810.879761787Kelun0.3094400680.3066321610.4813700930.417755441Sunflower0.5034686250.5427127140.5411647650.637334286Kunming Pharm0.4877527660.4945924690.4567842070.698168222Lummy0.594773780.6501483250.6201394760.63516333LAYN0.7066662810.7642503450.6584840630.757057246Lisheng Pharma0.6523582130.6582255850.6338026480.685028972Livzon Pharm0.4831278880.901473950.7658543450.719069177LEADMAN0.6852778680.7396936090.6854796690.749326011Lianhuan Pharm0.6725992940.7117572690.6701595410.741037539Lingkang0.6989029050.7434022310.6965862790.764084079Lingrui Pharm0.6744016360.6723890240.6149061340.706294196Long Jin Pharm0.7318451120.7704524440.7187670220.793216512Lukang Pharm0.4274684860.465706820.4603327690.682602477Mike Bio0.7080274830.723198520.6451497420.893314305M.k.0.7083959240.7264829260.568737590.613265307Palin Bio0.6713913140.7181819860.6664252420.757080803PIEN TZE HUANG0.6849306110.7504056590.6610391960.958922766Julie Plec0.7077043290.7237140450.6734627260.733615566Plyy0.4069597480.4148537780.4277358390.708905869CHEEZHENGTTM0.6866829510.7251353570.6782378650.768703082Qidi0.6668065470.682369240.644983980.770055989Qianhong Biopharma0.719386820.7193850250.6565600980.713796618Qianjin Pharm0.5306567910.5486290690.5227137540.848589111Qianyuan0.6385064670.6715433680.627910260.721933561Renfu0.3342188030.4132727440.1492314870.392902669Renhe Pharmacy0.5332684790.5069148130.5199994970.8252231Rpsw0.6380390280.6549743980.6178454970.693808777Saisheng0.7544733920.7967484890.727706480.76886275SAM0.6809094310.6895983580.5940206140.72317694Shanhe Pharmacy0.7132629810.7477558430.7012916180.776854953Shkb0.6906136540.7210269370.6553619280.725275566Shanghai RAAS Blood Products0.8159372160.7116329660.295122330.882937Shenqi0.6465158920.6651229010.6049057170.669811909Biological Stock0.7763003640.8577319610.7333105110.673469086Salvage Pharm0.4054239810.4711474110.5705804080.405427689Sts0.7453428680.7898095760.6959434430.728030381Scyy0.6213249920.7366247640.670142760.771774728Beijing SL Pharm0.7549595690.8224792510.7390666370.778537157Stellite0.646998610.6797910020.6487082420.695542742Shsw0.7064906880.7490479720.7018121010.790331518Tat0.5833020350.5798028330.5306127460.716883304Taiji Group0.3686979530.2883734470.5055066690.434540617Taloph Pharm0.605054210.6447078820.5694537810.657754327Teyi0.6856393880.7101370440.6673097160.731583384Tasly0.3447363230.3643982460.5475079610.410031592Tiantan Biological0.566854930.7351396850.7055972370.924450822Tianyao Pharm0.5677840750.6401007990.5683663280.808709151Thdb0.6904201520.760737240.6920586340.972117015Thjm0.7007593080.6820660650.620990780.2674205TRT0.4499416370.4525618560.5785653130.517445278Wanbangde0.3503981530.4108983120.4645474950.483783447Wondfo0.7060339330.7491632590.6663774870.738463539WEDGE INDUSTRIAL0.7180411810.7683976980.6902601110.76803824Weiming0.7481770090.7691283210.6198534860.710145248Wowu0.7392984510.7842439220.73861250.820113211Wohua0.6743229380.7101570450.6590120710.772121516Wosen0.6193034120.5714918750.7973938210.699460802AMD0.6899665690.7899412630.713295270.810580022Xianju Pharm0.5144648570.5664906220.5401095860.818150446Xiangxue Pharm0.5377836670.5400686230.4812752330.714362519Sunflower0.5400295230.5989986320.3885320540.706082152NHU0.5176920550.6038835170.660537920.748506424Xinhua0.4021098630.4301563220.4371749290.686348395Xinbang0.430116240.4288081920.3612372550.540651302SALUBRIS0.7448816150.7792941360.6976514880.639133074BROTHER0.6633838530.7195289770.5835981780.823868476Yabao0.4534187060.5079143920.5150889770.755819777Yatai0.6876246160.7234979460.6586610440.308960713Yananbikang0.6150882740.5986679780.635097450.491466664Yiling Pharm0.5353998970.546293010.5210046940.764562368Yifan0.621372480.7061452320.5434275560.768574846Yibai0.6018199830.5832459520.3444749020.726832453Yisheng0.6407080570.6792030140.6235393810.703137255Yiduoli0.618786470.6010978540.5669682910.80554492Chinataurine0.653922480.7158652760.6745135720.727223103Gloria Pharm0.6198024620.5831614650.5347497760.181246147Baiyao0.4077032920.4153258320.5986832780.592789916Zhejiang Medicine0.396941490.3939987310.6274378980.585114319Zhenbao Island0.6156370110.6304671450.5654641870.847153576Zdzy0.539305680.5415024350.4472816590.74754751Zhifei0.6590112630.7793839240.845780191Zhongguancun0.6079849420.5976610570.5591899380.648070137China Medicine0.2982937190.2843217850.3893965590.332076638Zhongheng Group0.65833690.7308237380.6608844530.747300882Zhongmu0.466975420.5057017280.4807530410.682814008Zhongxin0.4258699970.4786045660.4753363450.714813998Zsyy0.6722847420.7218394710.641258140.877851223JLZX0.6580452750.7247155090.5966661890.821878746Zuoli0.6470506890.6671067220.6163724590.703421246


## 4.4. DEA Efficiency Analysis in the Second Stage

In the second stage (shown in Table2), there is no company that has reached technical efficiency of 1 during 2015–2019, indicating that all the companies were not effective. There are 97 companies with a technical efficiency value of 0.6–1.0, accounting for 59.5%, which is significantly lower than the first stage. Only 3 companies had technical efficiency below 0.4 (Sinopharm, Xinbang, and Baiyunshan). The technical efficiency in second stage is generally low, but companies with lower efficiency have been promoted, which may be correlated with government subsidies.Adisseo, Dezhan Health, Jiao, Hengrui, Livzon Group, Shanghai RAAS, and Zhifei Biotechnology have achieved technical efficiency of 1 in some years. And Adisseo is the same as the first stage, the technical efficiency is effective in 2016 and has dropped dramatically after 2016. The technical efficiency of Dezhan Health and Jiao pharmaceutical companies in the second stage has increased; we believe that the first stage is relevant to the second stage in these companies. However, the average technical efficiency of Hualan Biological is below 0.6 in the two stages, for the resources cannot be well utilized (see Table4 for specific annual data).Table 4
Analysis of DEA efficiency in the second stage of Chinese pharmaceutical companies.
Company nameYear2015-20162016-20172017-20182018-2019Adisseo10.6498375450.6257374310.541530825Anke Bio0.7651620260.4761890620.7722551490.613658522Osaikon0.8437780660.4414459850.8507807310.575021161Baiyunshan0.1280297310.3384728090.446815410.404956323Bdyy0.8908343950.4452227540.7276765090.608956969Beilu0.8085449910.4477814740.7352022660.658558851Porton0.7906068560.4528643560.7411518930.630953461None0.8995533520.4122247690.6921647380.575225616Changchun High-Tech0.6973316340.5340868020.9742107310.83805388Changjiang Runfa Medicine0.7582782020.4572085970.7571782280.355161748Changshan Pharma0.8394309130.4522683920.7229494260.63821128DAJY0.4987498120.4530467710.7360621020.592503277Dezhan10.5401445160.9073256080.65741689Jiao10.69565735510.349390869DBBT0.791609790.4438872790.7254361610.605439407VC0.521766850.4525604750.49232620.401474275Dongcheng0.8756323340.4569548620.7686388570.621583435Nhwa Pharm0.9026855340.4811017410.8125063470.47310525Ekzy0.6639656940.4921396530.7415891750.417137904Fangsheng0.837283480.4459126680.7294483770.613888946Fengyuan0.3817007720.4482481780.7292552550.408521314Fczy0.8108294550.4503230960.7336124140.613158813Fayy0.8538510880.4626521380.6266760330.430608438Fosun Pharm0.4058795890.8876084740.8630396040.822061518Fuxiang0.6861479370.403026210.659687930.652530008Guangji0.7817837440.4388624220.7281055840.614602675Kwong Sang Hong0.8336008980.4452354210.7218736050.602632782Guang Yuyuan0.8735446330.4671737160.789871180.443703159Lark0.8563597230.5073552750.8345416430.432730249Glsj0.7628644980.4989327750.8024015530.666986138Sinopharm Hyundai0.3043264410.4678727650.5226099030.295245894Harbin Pharm0.4719078320.4989279740.518929830.413398936Haili Bio0.8459815940.4529635860.7157619690.596021344Hnhy0.5461322860.4512090710.739299060.377683569Hepalink0.5706928290.4557735860.8337482270.517400795Haishun New Pharma0.8751911210.4412839290.7185837190.61164409Haisco0.2652477590.4620945740.7704046380.453228976Hisoar0.8067776930.4837330430.8412845760.486621529Haixin0.8695993120.451220250.7488380020.618733421Hisun0.2953306770.4699350510.4346721280.436124359Han Sen Pharm0.8427922740.4490549270.7392697820.624481603Hybio0.7411908630.4821594270.649406530.450484128Hengrui0.9940066190.85120433511Chase Sun0.5109347680.2529636320.3881831450.487982456NCPC0.4469581380.4428936230.4850195120.416336438Huahai0.4836314190.5178198760.7445625470.468120819Hualan Bio0.4880186880.4632751330.8251558670.606937968Huaren0.8583224420.4459579890.726142990.608155932HRSJ0.390559960.6062967310.6598274560.641018804China Resources Double-Crane0.5320238860.5442029860.5886791290.519985Huashen Technology0.8994237230.4618629090.7239069590.610948685Walter Dyne0.8425026960.4972427210.7671432010.641896259Yanbian FC0.4426233860.6573294080.8878159630.555869763Kyrgyzstan0.4551808570.4668361490.7630562610.299038639Jichuan0.6924560780.2690194830.4808911910.509052877Jimin0.8431759820.4472301930.725934010.612949828JYPC0.9022645040.4057529650.7107645030.579782874Joincare Pharm0.3206793440.4460191870.4423653250.607505328Jiangzhong0.9685781560.4889101630.8069956810.681786657Jincheng0.6805876260.4468837250.7264634330.422778688Jinhe Bio0.7675559710.4548008530.7518967260.621861095Jinling0.8821518040.4626325320.7771498180.420373223Jinshiya0.8188249750.4303377380.7080294090.621839405Jingxin0.7542717860.39972610.6690112250.458543459Jinghua0.8188964140.464798970.7713051730.511596589Jingfeng0.6596288370.4625869120.7562454340.295660795Jiuqiang0.8888000590.4751141260.7795411590.656729486Jiuzhitang0.6829395940.3883852960.5762211750.418866032Jiuzhou0.700683030.4593764940.750175960.426386203CONBA0.4508403670.5320075340.5721598010.36900969Kanghong0.6308619170.3838742540.6329104240.462196751Kangyuan0.5698894620.4838125620.8000758310.457930115Kangzhi0.8604485120.4470777290.7228074240.595329819KHB0.758740450.4462622530.7318655530.430496937Kelun0.3921925540.4918780680.5739393150.514916857Sunflower0.3970694080.4022218670.6777471890.568562512Kunming Pharm0.4847125390.4828525570.7878632720.452428396Lummy0.7575919110.4460242940.7356994240.57313539LAYN0.826164770.466737080.7350881040.618275961Lisheng Pharma0.8922898980.448238650.7437826060.632397402Livzon Pharm0.33047651910.6212691090.563738749LEADMAN0.7444911320.4396741970.7085872780.605240773Lianhuan Pharm0.8833816640.4498826860.7335903380.614613785Lingkang0.4873426480.4611473150.7556094230.634678684Lingrui Pharm0.8205702940.4691082870.7684032760.650201258Long Jin Pharm0.8252695050.4454742960.72134830.596440566Lukang Pharm0.7093075440.2719677640.4484059640.41417971Mike Bio0.8296724910.4919635440.8165164520.463478288M.k.0.7025401710.4617985680.7505047230.334581671Palin Bio0.8003666880.442994070.7337465580.627260125PIEN TZE HUANG0.90453430.5382908450.9475361740.513658965Julie Plec0.5495210850.3051118150.4999393270.524584684Plyy0.5334028940.4219727280.7080182130.458768245CHEEZHENGTTM0.5651486590.4654294480.7614718670.662280612Qidi0.861178920.4415271530.7095082070.607695056Qianhong Biopharma0.8746060480.4563155370.7505635730.635328671Qianjin Pharm0.7392461080.4718145040.7799248670.439377818Qianyuan0.8313389850.4045752770.6551546680.336313058Renfu0.3344142050.6180459990.1760554830.552146513Renhe Pharmacy0.8881118730.4960370760.8370408150.469528713Rpsw0.5943945680.4338808690.7099304870.626972475Saisheng0.9296829340.4761577780.775990030.625516632SAM0.9052646820.4511502870.6805558610.60183122Shanhe Pharmacy0.8479248440.4329281460.7100087650.610022991Shkb0.8480897110.4714991570.7589092870.643053348Shanghai RAAS Blood Products10.544708280.4095203540.468019077Shenqi0.7147620960.3813445610.6176130410.61415927Biological Stock0.9653593570.5492231790.8706204830.638968678Salvage Pharm0.6893644330.4153082010.7067494770.198232344Sts0.9357575170.4721413330.743570520.605127606Scyy0.7391535330.4264859930.6764147710.571466831Beijing SL Pharm0.7337499390.5069477810.8328428480.681797114Stellite0.8033788960.4373709930.7152512620.614807042Shsw0.8904106160.4347617690.7001775970.603465476Tat0.8425862940.3608079230.5848232440.390571577Taiji Group0.679199530.4529807770.4740015410.387892653Taloph Pharm0.8426368240.4382247810.6891615250.607715363Teyi0.8363586940.4536820770.7490143520.629612238Tasly0.7172991630.6157350650.6752241490.512843572Tiantan Biological0.6786135590.5910612540.8602467740.500479724Tianyao Pharm0.8576771160.4483939480.7372409470.409261416Thdb0.9006881310.5457224150.8887417770.491006733Thjm0.7449761470.473113690.7853343150.254122817TRT0.8361779720.6561516090.7035607230.570595311Wanbangde0.7928518610.4536006640.4823064060.423211786Wondfo0.7182341540.4236541280.7123946550.672912535WEDGE INDUSTRIAL0.786233380.4507056670.7271736660.609309043Weiming0.8018467210.4890195590.6975306620.612890373Wowu0.9151782810.4442288650.7325301560.611424148Wohua0.8499510670.4511581650.7266572430.616986053Wosen0.2935388340.368962970.9275819150.621532855AMD0.5657896970.466053090.7559410060.654308568Xianju Pharm0.7221298260.469752240.7886108220.449576159Xiangxue Pharm0.565944130.4502466090.7286015950.406168036Sunflower0.7757272470.4351194950.4726275810.583260445NHU0.7444461920.0847924090.1745175150.645247085Xinhua0.6861500260.4185801310.6914756440.430862405Xinbang0.371466410.4823792560.297065990.42940549SALUBRIS0.8289506890.455146340.7440677550.492886897BROTHER0.8673615670.4912909660.7229691930.404592688Yabao0.625382230.4659814240.7761641460.400865973Yatai0.7918699110.4585799050.7494885010.274754037Yananbikang0.6095922910.5257548390.4958899030.382123694Yiling Pharm0.7321997420.5057486710.835209040.467694136Yifan0.8953803660.4281631950.6144912150.498168738Yibai0.6228202740.327751120.3862509870.412500415Yisheng0.6158185610.4502338590.7338561060.615039599Yiduoli0.7683702150.4541516980.7490928340.418880633Chinataurine0.7905722540.4454969580.7347871510.618625291Gloria Pharm0.4253751380.4730218260.7351987570.099279291Baiyao0.6764208970.8312255190.8985342610.870529199Zhejiang Medicine0.6489776210.4709282380.5088772620.43259115Zhenbao Island0.3667142140.447969520.7190058350.445442437Zdzy0.6664627770.4772720750.6880043430.415110578Zhifei0.7943125610.4885837410.851446092Zhongguancun0.6384314870.3610484750.6008297230.58735967China Medicine0.6003856610.6329357670.7050127280.541274783Zhongheng Group0.7794883370.5164317250.8429807720.726827094Zhongmu0.8917914260.4615958810.7586295870.388861314Zhongxin0.7842991660.5000359960.8337342880.470157549Zsyy0.7122365560.4937766550.8058818330.435730452JLZX0.568394670.4873518220.75384120.407572713Zuoli0.5068306350.3278428370.5300452260.603856046


## 4.5. Overall Efficiency Analysis

In the overall efficiency analysis (shown in Table2), there are 109 companies with efficiency between 0.6 and 1.0, accounting for 66.9%, and it shows that the technical efficiency of the second stage is less than that of the first stage.Comparing Hengrui (the highest efficiency) and Baiyunshan (the lowest efficiency), we found that Hengrui did not receive government subsidies in the 2018 and 2019, but the technical efficiency reached 1, and Baiyunshan has received government subsidies, but the technical efficiency rises first and then decreases.For Zhifei Bio with the second highest efficiency, its efficiency in 2018 and 2019 was significantly higher than in 2016 and 2017, and the government subsidies received by Zhifei Bio in 2018 and 2019 were significantly lower than before. The second-to-last-ranked company, Medicare, reached a low point in 2018, followed by a significant rebound next year, when it was not subsidized by the government in 2019.It can be concluded that government subsidies have no obvious effect for most companies, but it has a positive impact on enterprises with low efficiency in a short term. The government may need to reconsider the way of subsidies to pharmaceutical companies, such as the capital subsidies to equipment upgrades and talent introduction (see Table5 for specific annual data).Table 5
Analysis of the overall efficiency of Chinese pharmaceutical companies.
Company nameYear2015-20162016-20172017-20182018-2019Adisseo10.5943319610.6872535270.590582307Anke Bio0.7320504730.6039047780.7216841730.658510045Osaikon0.7784277130.5990919170.8320599090.696276311Baiyunshan0.2282859210.3473966660.4966612280.354314544Bdyy0.7402978130.5370308070.65999850.641144699Beilu0.7548489820.6088730490.7268683790.745366839Porton0.7040581350.5374398380.6737514190.645425288None0.8045404690.5810322220.6864031270.634019398Changchun High-Tech0.6707852680.6139813290.8263282210.91902694Changjiang Runfa Medicine0.7096760620.5455335640.6674032350.486189125Changshan Pharma0.7710026740.5948564240.688923170.682407653DAJY0.5533919960.5328047220.6508557740.625961732Dezhan0.8891240070.7130579080.854249280.696289729Jiao0.8479380070.7241062760.8923137670.434427484DBBT0.7450185960.5883988670.7046180160.676626886VC0.43925690.4110828250.5444731270.465493745Dongcheng0.7804654310.585155610.7104396980.633026364Nhwa Pharm0.7343681390.538495310.6860679790.687237305Ekzy0.6799294150.5671411710.6513498980.617078583Fangsheng0.7638570570.5765746340.698841610.674382377Fengyuan0.4448274140.4808151130.6147838920.606094921Fczy0.7420740880.5784414150.6854499820.654076242Fayy0.7470251250.5427673590.5507779410.641860364Fosun Pharm0.4233543750.6703931530.677343370.657568579Fuxiang0.6906198280.5581730350.6575028030.69283151Guangji0.7238297950.5621637760.6973074810.671209547Kwong Sang Hong0.7824064230.6016771490.7127362660.684833649Guang Yuyuan0.789636040.5979882360.7312771720.563852758Lark0.7242148010.5575230410.6913431220.603175409Glsj0.7044704050.6009244120.7225220940.691917544Sinopharm Hyundai0.4274133770.3935735920.5546559680.411827436Harbin Pharm0.3524059180.3693392390.4855867070.432828982Haili Bio0.7834702090.6043438390.6995728980.67374349Hnhy0.5699277670.5334363760.6366009220.537164476Hepalink0.5921587590.5253434520.6993934290.659703397Haishun New Pharma0.80302480.6059418680.7161347250.700106885Haisco0.4800992390.5758676850.6990647280.661359713Hisoar0.6714691030.5410390940.7109096930.676879776Haixin0.7342605820.5514484370.6764862560.637198392Hisun0.2873965290.3805940160.4158214670.441140083Han Sen Pharm0.7327167090.5596965880.6887669170.684174582Hybio0.7240904420.6221275820.6096111850.477857438Hengrui0.8269577480.77062878411Chase Sun0.5507757480.3996777490.4366196020.528426739NCPC0.3542183690.3580941940.4807755780.427708854Huahai0.4972855950.5253993890.583506410.588866754Hualan Bio0.6062538710.6111569060.7866764930.803468984Huaren0.7030671830.52625570.6495807090.631043029HRSJ0.4061833540.515538430.6510867890.659592625China Resources Double-Crane0.4641810450.4781104690.6674872440.618744398Huashen Technology0.795853310.6052535660.6985141760.686848921Walter Dyne0.7457802530.5922814380.6857375850.679786234Yanbian FC0.585529060.7268438180.755394780.760336119Kyrgyzstan0.572914710.5952787920.7198072650.307289038Jichuan0.6735247410.4783859740.5699041860.621509323Jimin0.7551916470.5812166690.6824980220.658109286JYPC0.7892139670.5331524210.6926644210.655377456Joincare Pharm0.3733893570.6127879480.4312481920.711024008Jiangzhong0.7732806240.574572330.7143835710.696034497Jincheng0.64246880.5412558740.6333957560.600807083Jinhe Bio0.6940222140.538558340.6725302940.639655629Jinling0.6699227260.4635589830.631224910.598918507Jinshiya0.7792022180.612611290.675051690.654243898Jingxin0.6846424160.5225486310.6349302640.670080794Jinghua0.736594230.5802610280.7081151530.532218118Jingfeng0.6575498580.5438713460.6589662420.439651462Jiuqiang0.8321685430.6404409080.7604473780.740948042Jiuzhitang0.6606859220.5103654950.5515187430.601037942Jiuzhou0.6159064790.5112295880.6517015620.646607443CONBA0.437899970.4900497290.6676717110.454110037Kanghong0.6402704090.5303938680.6253558680.589391549Kangyuan0.5585315610.5111124830.6610251340.653468887Kangzhi0.7709541930.5829669670.6906954160.63784734KHB0.7193248250.5761387570.6890426670.655129362Kelun0.3508163110.3992551140.5276547040.466336149Sunflower0.4502690170.472467290.6094559770.602948399Kunming Pharm0.4862326520.4887225130.6223237390.575298309Lummy0.6761828460.5480863090.677919450.60414936LAYN0.7664155260.6154937130.6967860830.687666604Lisheng Pharma0.7723240560.5532321180.6887926270.658713187Livzon Pharm0.4068022040.9507369750.6935617270.641403963LEADMAN0.71488450.5896839030.6970334740.677283392Lianhuan Pharm0.7779904790.5808199770.701874940.677825662Lingkang0.5931227770.6022747730.7260978510.699381382Lingrui Pharm0.7474859650.5707486550.6916547050.678247727Long Jin Pharm0.7785573080.607963370.7200576610.694828539Lukang Pharm0.5683880150.3688372920.4543693660.548391093Mike Bio0.7688499870.6075810320.7308330970.678396297M.k.0.7054680470.5941407470.6596211570.473923489Palin Bio0.7358790010.5805880280.70008590.692170464PIEN TZE HUANG0.7947324550.6443482520.8042876850.736290866Julie Plec0.6286127070.514412930.5867010260.629100125Plyy0.4701813210.4184132530.5678770260.583837057CHEEZHENGTTM0.6259158050.5952824020.7198548660.715491847Qidi0.7639927330.5619481960.6772460940.688875522Qianhong Biopharma0.7969964340.5878502810.7035618360.674562645Qianjin Pharm0.6349514490.5102217870.6513193110.643983464Qianyuan0.7349227260.5380593220.6415324640.529123309Renfu0.3343165040.5156593710.1626434850.472524591Renhe Pharmacy0.7106901760.5014759440.6785201560.647375907Rpsw0.6162167980.5444276340.6638879920.660390626Saisheng0.8420781630.6364531340.7518482550.697189691SAM0.7930870560.5703743230.6372882380.66250408Shanhe Pharmacy0.7805939120.5903419940.7056501920.693438972Shkb0.7693516820.5962630470.7071356070.684164457Shanghai RAAS Blood Products0.9079686080.6281706230.3523213420.675478039Shenqi0.6806389940.5232337310.6112593790.641985589Biological Stock0.8708298610.703477570.8019654970.656218882Salvage Pharm0.5473942070.4432278060.6386649430.301830016Sts0.8405501920.6309754550.7197569820.666578994Scyy0.6802392630.5815553780.6732787660.671620779Beijing SL Pharm0.7443547540.6647135160.7859547430.730167136Stellite0.7251887530.5585809970.6819797520.655174892Shsw0.7984506520.5919048710.7009948490.696898497Tat0.7129441650.4703053780.5577179950.553727441Taiji Group0.5239487410.3706771120.4897541050.411216635Taloph Pharm0.7238455170.5414663310.6293076530.632734845Teyi0.7609990410.5819095610.7081620340.680597811Tasly0.5310177430.4900666560.6113660550.461437582Tiantan Biological0.6227342440.663100470.7829220060.712465273Tianyao Pharm0.7127305960.5442473730.6528036370.608985283Thdb0.7955541420.6532298280.7904002060.731561874Thjm0.7228677280.5775898770.7031625470.260771659TRT0.6430598050.5543567330.6410630180.544020294Wanbangde0.5716250070.4322494880.4734269510.453497617Wondfo0.7121340430.5864086940.6893860710.705688037WEDGE INDUSTRIAL0.752137280.6095516830.7087168890.688673642Weiming0.7750118650.629073940.6586920740.661517811Wowu0.8272383660.6142363940.7355713280.715768679Wohua0.7621370030.5806576050.6928346570.694553785Wosen0.4564211230.4702274220.8624878680.660496829AMD0.6278781330.6279971770.7346181380.732444295Xianju Pharm0.6182973410.5181214310.6643602040.633863302Xiangxue Pharm0.5518638990.4951576160.6049384140.560265277Sunflower0.6578783850.5170590630.4305798180.644671298NHU0.6310691240.3443379630.4175277170.696876755Xinhua0.5441299450.4243682260.5643252860.5586054Xinbang0.4007913250.4555937240.3291516230.485028396SALUBRIS0.7869161520.6172202380.7208596220.566009985BROTHER0.765372710.6054099710.6532836860.614230582Yabao0.5394004680.4869479080.6456265610.578342875Yatai0.7397472640.5910389260.7040747720.291857375Yananbikang0.6123402830.5622114090.5654936760.436795179Yiling Pharm0.6337998190.5260208410.6781068670.616128252Yifan0.7583764230.5671542140.5789593850.633371792Yibai0.6123201290.4554985360.3653629450.569666434Yisheng0.6282633090.5647184370.6786977440.659088427Yiduoli0.6935783420.5276247760.6580305620.612212776Chinataurine0.7222473670.5806811170.7046503620.672924197Gloria Pharm0.52258880.5280916460.6349742660.140262719Baiyao0.5420620950.6232756760.748608770.731659557Zhejiang Medicine0.5229595550.4324634840.568157580.508852734Zhenbao Island0.4911756120.5392183320.6422350110.646298006Zdzy0.6028842280.5093872550.5676430010.581329044Zhifei0.7266619120.6339838320.9228900950.925723046Zhongguancun0.6232082150.4793547660.580009830.617714904China Medicine0.449339690.4586287760.5472046430.43667571Zhongheng Group0.7189126180.6236277310.7519326120.737063988Zhongmu0.6793834230.4836488040.6196913140.535837661Zhongxin0.6050845810.4893202810.6545353160.592485773Zsyy0.6922606490.6078080630.7235699870.656790838JLZX0.6132199720.6060336660.6752536940.61472573Zuoli0.5769406620.4974747790.5732088420.653638646


## 5. Dynamic Effect Analysis

The efficiency of the two-stage network DEA model varies from year to year, and the efficiency value of different years is not comparable, so time series analysis cannot be carried out. To make up for the shortcomings of the traditional two-stage network DEA, this paper adds the Malmquist index to study the total factor productivity of listed pharmaceutical companies in 2015–2019 and quantify its decomposition limit. The results are shown in Table6.Table 6
Annual Malmquist index and its decomposition indexes.
ECSCTCPCTFP2015-20161.18412.79101.01090.42421.19702016-20170.51621.44721.12110.35670.57872017-20180.98152.46761.00180.39780.98332018-20190.51881.21761.00340.42600.5205Mean0.80011.98081.03430.40120.8219The average total factor productivity (TFP) is 0.8219 that has fallen by an average 17.81%. Viewed from the decomposition index, the mean of EC is 0.8001; that is, EC has decreased by an average of 19.99%. The mean of PC is 0.4012, with the rate of decline in each averaging over 59.88% a year. SC is 1.9808, with an average annual growth rate of 98.08%. It shows that the operating efficiency of listed pharmaceutical enterprises depends on the scale expansion and makes up for low management efficiency. The average technology change (TC) is 1.0343, and it has risen by nearly 3.43% per year. The technology change has been improved between 2015 and 2019.The listed pharmaceutical companies rely on product development and can be combined with innovative technologies. For the pharmaceutical industry, the level of research and development of products indirectly affects the level of industry development. The drugs or pharmaceutical equipment is very important; if the level of medical technology research and development is not advanced enough, the progress of medical level will be affected. Therefore, the listed pharmaceutical enterprises should rely on the existing advanced technology achievements, improving their own technology, to improve operating efficiency.


## 6. Conclusion

This paper firstly divides the two subsystems by using the two-stage network DEA and analyses the operating efficiency of 1,63 listed pharmaceutical companies in China from 2015 to 2019. Secondly, Malmquist index is used for dynamic analysis; the total factor productivity and decomposition limit were obtained. Finally, we make some suggestions based on the results of the study.From the results, the technical efficiency of the second phase is less than that of the first stage; government subsidies have no positive impact on most companies. It is possible that enterprises move government subsidies elsewhere rather than pharmaceutical companies. It is also possible that government subsidies have increased, enterprises are more willing to invest in product development and enterprises expansion, and it is difficult to see the improvement of operational efficiency in the short term. However, the government subsidies have a positive impact on enterprises with low efficiency in a short term. To ensure the efficiency of investment and avoid waste of resources, government needs to choose the object of subsidies carefully and reformulate policies that encourage pharmaceutical listed companies. And according to the Malmquist index results, enterprises should pay attention to risk prevention and avoid rapid expansion bringing in diseconomies of scale. All in all, enterprises should improve management level and technological capabilities and shift scale growth to total factor productivity.However, there are also some limitations. Regarding the data resources, the data we chose cannot exactly predict the operational situations among current Chinese medical firms, since there is more uncertainty in the market, especially during the COVID-19 period, which is likely to be a potential direction that other scholars can study further in the future. Concerning variables, this article analyses the operational efficiency of 164 firms; researchers can only choose several companies to make an in-depth analysis instead of the whole industrial analysis.



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*Source: 1475781-2021-06-23.xml*