A research and development decision model for pharmaceutical industry: case of China

This paper evaluates prospective technology areas, development strategies, and various innovation resources in China's pharmaceutical sector through the use of a hierarchical decision model. The results indicate that although domestic SMEs are the major preferred innovation alternative, it is followed closely by foreign MNCs. The sensitivity analysis indicates that the effectiveness of policy decisions are influenced by certain high technology areas. Recombinant therapeutic proteins, recombinant vaccines, and monoclonal antibody technologies are identified as the major areas that will influence the priority of innovation resources. The research crafts a research framework to formulate innovation strategies in dealing with the uncertainties of technology development and policy decisions in the biopharmaceutical industry.     

A goal-oriented pharmaceutical research and development organization: an eleven-year experience

Pharmaceutical R & D effort is multidisciplinary and matrix in management form, but variable in organizational detail. Upjohn's discipline-oriented organization (coordination matrix) of 11 years ago is compared to its current organization consisting of a goal-oriented, leadership matrix and a simultaneously existing coordination matrix. Product development success and individual performances were similar for the concurrent coordination matrix and leadership matrix. Consensus on candidate product identification and execution of development plans is easier with a leadership matrix than with a coordination matrix, but flexible response to new or changing goals seems more likely with a coordination matrix. The location of candidate product advocacy differed in the two types of organization. Strategies effected over the 11-year period to overcome inherent limitations of goal-oriented organizations and functional organizations included the maintenance of competing yet synergistic, functional, and goal-oriented organizations, a strong publication and basic research policy, and a Troika' approach to candidate selection and development in the functional organization.     

A company model for research and development

A company model is presented which may be used to assess the effecton future company performance of the level of investment in research and development. A distinctive feature of the model is the postulation of research return curve which relates the available return on potential new capital investments to the amountof capital invested and the size of a research pool. The latter is related to past R & D expenditure. It is shown how the research return curve may be adjusted to represent different types of industry and how a suitable form for this curve may be derived from company records. Examples are given of the use of the model for sensitivity and optimization studies.     

A two-stage model of research and development with endogenous second-mover advantages

This paper describes a simple two-stage model of research and development, in which the ‘winner’ of the research stage has the option of moving first in the development stage. Some unexpected results emerge: in equilibrium, the leader in the development stage invests less than each follower, and is consequently least likely to collect the patent. Moreover, the leader receives a lower expected payoff than each of the followers. Thus there are endogenous second-mover advantages. Using a game of timing (in which the identity of the Stackelberg leader is determined) to link the two stages, I find that firms face quite different incentives in the research stage. Although the leader invests less than each follower in the research stage as well, the leader enjoys higher expected revenue from the complete (two-stage) game than does each follower. The equilibrium is inefficient because there is a lag between the time at which research is completed and the time at which development is begun, and because aggregate investment is inefficiently (asymmetrically) distributed across firms.     

The use and development of a research project planning and progressing system

This paper discusses the use and development of a research project planning and progressing system based on the system described by Baker & Smith (1967). It is an attempt to highlight some of the practical problems involved in setting up and developing such a system at Colworth/Welwyn, the largest Unilever research laboratory in the United Kingdom. The problem at Col worth/Welwyn, as at Port Sunlight, was to improve communications at all levels of management, and, in particular, to direct senior management's attention to those areas where it was most needed.
The system described here is only a project control system, and does not formally cover other aspects of research management such as project selection and result implementation. A project control system was chosen as the starting point because it was regarded as the most important, and the easiest to implement throughout the whole laboratory.
This paper was first presented at a conference to the R & D Study Group of the Operational Research Society, February 1970.     

Implementing Lean Sigma in pharmaceutical research and development: a review by practitioners

The authors recount their experience of the implementation of lean thinking and Six Sigma in pharmaceutical development research and development (R&D). Use of Lean Sigma in pharmaceutical manufacturing is widespread and generally noncontentious. Lean Sigma is used successfully to improve the development of new pharmaceutical manufacturing processes. However, the value of the application of lean and Six Sigma ideas to research & development is controversial. Published material is reviewed, and then the methods, tools, barriers and benefits are discussed, with recommendations for implementation of Lean Sigma into an R&D organisation.     

A measurement model of strategic planning

While strategic planning is a key concept in management research, there has been little consistency in its conceptualization or measurement. Our review of prior studies also identifies reliability and validity, dimensionality, crude levels of measurement, and lack of parsimony as additional problems associated with prior use of this variable. Such problems substantially limit our ability to compare results across studies, or to make appropriate normative recommendations. We address these concerns by developing and validating a multiple indicator measure of strategic planning, using two independent samples. Implications for future research are then discussed. © 1998 John Wiley & Sons, Ltd.     

Does international research and development increase patent output? An analysis of Japanese pharmaceutical firms

Internationalizing research and development is often advocated as a strategy for fostering the development of technological capabilities. Although firms conduct international R&D to tap into knowledge bases that reside in foreign countries, we argue that in order to benefit from international R&D investments firms must already possess research capabilities in underlying or complementary technologies. We examine the international R&D expansion activities, research capabilities, and patent output of 65 Japanese pharmaceutical firms from 1980 to 1991. We find that firms benefit from international R&D only when they possess existing research capabilities in the underlying technologies. In addition to refining our understanding of when international R&D enhances firm innovation, our results integrate asset‐seeking and asset‐based theories of foreign direct investment. Internationalizing R&D to tap into foreign knowledge bases is consistent with asset‐seeking theories of foreign direct investment, while the contingent nature by which firms benefit from international R&D is consistent with asset‐based theories of foreign direct investment and the notion of absorptive capacity. Copyright © 2004 John Wiley & Sons, Ltd.     

A planning procedure for new-product chemical research

RESPRO is a computer-based planning tool for new-product chemical research, particularly in the pharmaceutical and agro-chemical industries. It helps the research manager to make quantitative judgements about the effects of different effort allocations to projects at the stage when large numbers of formulations are being tested. These then serve as the basis for estimating the profitability of any given allocation plan, and for adjusting a given plan to make it more profitable. The paper introduces RESPRO and sets it in the context of other similar procedures.     

Why crash pharmaceutical research?

In a competitive environment it is important to bring research projects to an early successful conclusion. A stochastic model of a typical pharmaceutical research project shows that it is often very desirable to allocate more scientists to a project than the number which is most efficient in terms of progress per scientist-year.     

Balancing resources in pharmaceutical research

Within the financial and technical objectives of pharmaceutical R & D, an important sub-goal is the maintenance of a long-term balance between the different activities of research. Such a balance provides stability and, by ensuring a high utilization of research man-power, offers a higher output from a given level of investment. This paper describes the development and use of a simple technique to assist in attaining this balance. The performance of a strategic plan, in both the long- and short-term, is assessed, and the scope for corrective action to deal with deviations from the plan is explored. The flexibility and robustness of suitable strategic plans are demonstrated by the use of simulation.     

A modelling approach to planning product innovative research

Abstract . The generation of ideas for new products and their subsequent survival through a number of evaluation and development stages are—at least in part—random processes. To examine the implications of this for research planning and resource allocation a model has been constructed to simulate the progress of ideas through such an evaluation system using Monte Carlo methods. Use of the model on such typical product-innovative fields as a 'new venture' portfolio and effect-chemicals R & D has yielded valuable insights into variability in output of ventures suitable for commercialization, the degree of confidence which may be placed in achieving a desired objective, and its relation to costs and resource allocations at different stages of the process. The model also allows examination of sensitivities to the assumptions made in its construction and to data used as input.     

Factors influencing the profitability of pharmaceutical research

The output from a pharmaceutical research project is a stream of candidate drugs which may be submitted to clinical trials. The value of this output depends on the characteristics of the stochastic process generating this stream, and on the extent to which the candidate drugs are chemically similar to each other. This paper explores the impact of these factors on profitability, and on the policy which should be followed for selecting candidate drugs.     

新政策背景下国内制药企业新药研发的思考

国内制药企业在新药研发中存在着一些误区,在新的政策背景下,企业应调整研发思路,形成符合自身实力和需求的开发策略.     

Has pharmaceutical research become more scientific?

Pharmaceutical research continues to be highly empirical, despite some recent writings arguing that it has become more scientific. Contrary to a study asserting that Mevacor, Tagamet, and Capoten demonstrate the success of targeted research, these drugs were discovered only after many years of following leads. Two hypotheses implied by the proposition that pharmaceutical research has become more scientific are tested. The first hypothesis is that the uncertainty of research has fallen. The second is that the number of publications by scientists in the industry has increased. Both are rejected.     

A hierarchical process industry production–distribution planning model

Global and multinational companies are subject to government regulations in addition to other international uncertainties due to operation in diverse geographic locations. Such government regulations often affect the cost of raw materials adversely which in turn creates adverse impact on product cost and forces the decision makers to re-evaluate current production–distribution plan. This paper presents an integrated supply chain model for simultaneous strategic and operational planning of a strategic business unit (SBU) in a global supply chain affected by government regulations. The model incorporates impact of changes in cost of inputs on expected product cost and solves for an optimal strategic and operational plan for the entire supply chain. In addition, the model includes exchange rates, border crossing costs and solves a multi-period model with due consideration of uncertainties in demand and transportation time.     

A shift to external alliances for product development in the pharmaceutical industry

For a number of years, pharmaceutical companies have been departing from a tradition of strict vertical integration, looking to external sources for at least some of their novel technology and products. The aim of this study was to determine whether (1) this is a long term, industry-wide trend, or (2) merely a temporary or local response to acquire the technical capabilities of the biotechnology revolution of the 1970's, after which, with the new generation of technology in-house, they will revert to primarily in-house innovation. Analysis of secondary data on a representative sample of the fifteen largest drug companies in the United States, the United Kingdom, Germany and Switzerland indicated that between 1977 and 1987, these pharmaceutical companies increased their external R&D alliances nearly six-fold on average. A large and growing proportion of pharmaceutical companies' R&D alliances are formed with biotechnology firms which have proprietary technology, due to financial and innovative pressures. Far from being temporary, this resort to external sources of technology in the pharmaceutical industry follows the trends of the wider industrial world towards functional specialization. Thus, biotechnology companies are increasingly taking on the role of suppliers of innovation.     

Reasons for corporate research and development spin‐outs – the chemical and pharmaceutical industry as example

The spin‐out of research and development (R&D) activities from established companies has increased during recent years. The reasons for realising corporate spin‐outs, especially regarding the involvement of financial investors, were investigated based on 30 European case studies within the chemical and pharmaceutical industry. The reasons can be categorised into two groups: an investment and a divestment rationale. Whereas the chemical industry uses both rationales, there are only divestment cases in the pharmaceutical industry. The investment cases within the chemical industry show that R&D spin‐outs can make an important contribution towards the flexibilisation and performance improvement of a company's internal R&D. The divestment cases show that R&D spin‐outs can be a suitable possibility to continue promising R&D activities. The survival rate of the analysed spin‐outs is high and numerous new jobs have been created in the past years, especially in pharmaceutical spin‐outs.     

Medium term planning and control in research organizations

By definition, the processes involved in research involve an element of uniqueness and the exact nature of the end product cannot be predicted with certainty. Thus the means used for planning and controlling organisations for which research is a dominant activity cannot be the same as those for which the activities are repetitive and for which standards can be defined.
This paper describes the differences in planning and control methodology to be expected between process-oriented and research organisations and reports the results of a survey of the accounting practices of 10 research organisations.     

Creativity techniques in product planning and development: A view from West Germany

The author advocates the use of formalised heuristic principles and teamwork as the cornerstone of creativity techniques on which he has written papers in German, and in view of the interest aroused has taken the opportunity to write a summary for an English-language journal. The purpose of the paper is to review the large number available, to indicate their most profitable field of use and their limitations. He classifies the techniques into four main groups, intuitive association, intuitive confrontation, systematic variation and systematic confrontation. Brainstorming is an example of the first, excursive synectics of the second, morphological analysis of the third and the morphological matrix of the last. He briefly summarises the method employed by about 20 of the 50 he says exist.
The paper concludes with some advice to potential users of the methods and a review of the use made of them in German industry.