160 The Impact of the Act for the Development of Biotech and New Pharmaceuticals Industry on Firm Innovation in Taiwan Panel B.2 DID Regression Results for Adjusted Patent Citations in the Intra-industry Analysis: Non-pharmaceutical Firms One Matched Firm Two Matched Firms Three Matched Firms Four Matched Firms (1) (2) (1) (2) (1) (2) (1) (2) Aftert -0.0093 -0.0051 -0.0093 0.0010 -0.0054 0.0024 -0.0136 -0.0081 (0.7946) (0.8923) (0.7770) (0.9759) (0.8183) (0.9233) (0.5111) (0.0507) Treatmenti -0.0046 -0.0089 -0.0129 -0.0163 -0.0050 -0.0124 -0.0133 -0.0175 (0.8687) (0.7724) (0.6657) (0.6228) (0.8387) (0.6486) (0.5768) (0.4986) Afteri × Treatmenti -0.0065 0.0013 -0.0100 -0.0014 -0.0073 0.0048 0.0000 0.0109 (0.8666) (0.9754) (0.8105) (0.9758) (0.8330) (0.8980) (0.9996) (0.7587) LN (1+NetSalest-1) -0.0052 -0.0068* -0.0076*** -0.0107*** -0.0068*** -0.0107*** -0.0063*** -0.0092*** (0.1034) (0.0653) (0.0085) (0.0018) (0.0031) (0.0002) (0.0033) (0.0006) RDt-1 -0.0006 -0.0005 -0.0016 -0.0020 -0.0007 -0.0013 -0.0004 -0.0006 (0.6938) (0.7309) (0.2574) (0.1968) (0.4952) (0.2618) (0.6872) (0.5561) Tobin’s Qt-1 -0.0063 -0.0092* -0.0080* -0.0089** (0.2233) (0.0997) (0.0938) (0.0495) Observations 176 166 262 243 366 334 477 433 Adjusted R2 0.0675 0.0631 0.1044 0.1106 0.0744 0.0852 0.0407 0.0528 Note: This table presents the panel regression results of the subsamples divided by different operating items, including pharmaceutical firms and non-pharmaceutical firms in the intra-industry. Panels A.1 and A.2 show the regression results that explain the R&D investment for pharmaceutical firms and nonpharmaceutical firms, respectively. Panels B.1 and B.2 show the regression results that explain the adjusted patent citations for these two subsamples. The dependent variable of Panels B.1 and B.2 is LN (1+adjusted patent citation). The regression is shown in equation (1) of Section 3.3.4. Aftert = 1 if the firm is in the approval year or after approval year and 0 otherwise; Treatmenti = 1 if the firm is in the treated group and 0 otherwise. The treated firms are approved biopharmaceutical firms, while control firms are unapproved biopharmaceutical firms. The definitions of variables are presented in Appendix Table A1. Numbers in parentheses are p-values. ***,**, and * denote significance at the 1%, 5%, and 10% levels, respectively. The coefficients of Treatment in Panel B.1 of Table 5 are positive significantly. These results imply that in the group of pharmaceutical firms, the approved firms always have higher innovation quality (i.e. patent adjusted citation) than the unapproved firms. In addition, in both Panel B.1 and B.2, the coefficients of the interaction term, Table 5 DID Regression Result of Intra-industry: Subsample Analysis for Different Operating Items (cont.)

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