(pp.003-025) T. Hender, T. Thornblad and B. Remneland ‘Open innovation in the biomedical sector’, World Sustainable Development Outlook, 2011
Abstract: The concept of Open innovation is a phenomenon gaining momentum among pharmaceutical companies, university research consortia and other for-profit and non-profit organizations in order to address increasingly complex, uncertain and changing R&D projects. In medicine, open innovation projects may provide incentives for creativity, adaptability and easier access to knowledge as well as to generate quicker and cheaper innovation cycles for defined products and services. Also, projects and products may be better adjusted to the markets and provide flexible cost structures in developed as well as developing countries. There are today growing efforts for non-profit foundations to participate and establish co-operation in complex research and development efforts such as bringing new medical drugs or new technology to public use. Interestingly, such incentives might open up for new and creative open innovation models. In this paper, we discuss how the open innovation model differs from the classical closed innovation model in respect to; type of project, organizing aspects and value creation and value extraction aspects. We also illustrate 3 different value extraction concepts relating to open innovation in the pharmaceutical sector, representing different strategies and degrees of openness; the Medicine for Malaria Venture (MMV); InnovationXchange; and InnoCentive. Further, we discuss how the term “openness” can be understood in levels; in terms of the extent of control a collective upholds for ownership as well as the access and utilization of platform content that is jointly aggregated, created and developed. Collective innovation can be described as; open for all (openness with little, or no, limitations); open IP groups (openness within R&D groups); open IP projects (openness within R&D collaboration projects); open IP communities (openness within certain communities); and open IP platforms (structural arenas for openness). Our case examples illustrate how open innovation networks may provide new possibilities to generate value from academic – industrial networks. However, the open innovation model builds on involvement from a variety of external sources, such as independent researchers and experts, R&D institutes, universities and contract research organizations, customers, partner companies or even competitors. In the transition from a closed to an open innovation model, the pharmaceutical industry needs to develop flexible boundaries to allow a creative exchange of knowledge and experience from the outside to the inside of their organisation.
Keywords: Open innovation, pharmaceutical industry, biomedicine, open capital, drug discovery, drug development, business model.