The study aims to improve understanding of knowledge dissemination on performance determinants in the Indian pharmaceutical industry. Panel data analyses have been used to describe R&D spillover mediated through fixed assets act as a knowledge diffusion pathway, along with five other factors that affect profitability. R&D spillover mediated through physical capital points to knowledge diffusion, albeit in a small way, indicating that such things can take a permanent shape all across the industry. Fixed assets' negative relationship with profitability results from a directional shift in the last two decades.