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The External Sourcing of Technological Knowledge by US Pharmaceutical Companies: Strategic Goals and Inter-organizational Relationships

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  • Christel Lane
  • Jocelyn Probert

Abstract

This study of the organization of the discovery function by large US pharmaceutical companies (LPCs) examines an important knowledge acquisition strategy—external sourcing of compounds and technologies. Through a critical examination of the “capabilities” thesis in strategic management and of the theoretical conceptualization in organization studies of innovation networks, we undertake an in-depth qualitative analysis of the network relationships LPCs establish with biotechnology firms/public research laboratories. We additionally examine the motivations and degree of strategic intent of R&D managers involved in external knowledge sourcing. The paper identifies the tensions and contradictions in network relationships and indicates how these lead to changes in knowledge sourcing. This qualitative analysis is placed in its industry and technology context. This reveals both the pressures towards and the trends in external knowledge sourcing, as compared with in-house discovery. Extensive interviews with US LPCs and biotechnology firms provide a rare glimpse of how some of the most important actors in global innovation networks handle a significant new innovation strategy.

Suggested Citation

  • Christel Lane & Jocelyn Probert, 2007. "The External Sourcing of Technological Knowledge by US Pharmaceutical Companies: Strategic Goals and Inter-organizational Relationships," Industry and Innovation, Taylor & Francis Journals, vol. 14(1), pages 5-25.
    • Handle: RePEc:taf:indinn:v:14:y:2007:i:1:p:5-25
    DOI: 10.1080/13662710601130574
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    References listed on IDEAS

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    1. Arora, Ashish & Gambardella, Alfonso & Pammolli, Fabio & Riccaboni, Massimo, 2000. "The Nature and the Extent of the Market for Technology in Biopharmaceuticals," MPRA Paper 15977, University Library of Munich, Germany.
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    Citations

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    Cited by:

    1. Beverly B. Tyler & Turanay Caner, 2016. "New product introductions below aspirations, slack and R&D alliances: A behavioral perspective," Strategic Management Journal, Wiley Blackwell, vol. 37(5), pages 896-910, May.
    2. Huber, Franz, 2013. "Knowledge-sourcing of R&D workers in different job positions: Contextualising external personal knowledge networks," Research Policy, Elsevier, vol. 42(1), pages 167-179.
    3. Archibugi, Daniele & Filippetti, Andrea, 2018. "The retreat of public research and its adverse consequences on innovation," Technological Forecasting and Social Change, Elsevier, vol. 127(C), pages 97-111.
    4. Arup K. Sen, 2009. "Outsourcing Of Research And Development Activities: Evidence From U.S. Biopharmaceutical Firms," Global Journal of Business Research, The Institute for Business and Finance Research, vol. 3(1), pages 73-82.
    5. Arup K. Sen & Kushnood Haq, 2011. "Product Innovation By Small And Medium-Sized Firms Through Outsourcing And Collaboration," International Journal of Management and Marketing Research, The Institute for Business and Finance Research, vol. 4(1), pages 61-73.
    6. Daniele Archibugi & Andrea Filippetti, 2016. "(English) The Retreat of Public Research and its Adverse Consequences on Innovation (Italiano) I cambiamenti nella ricerca pubblica e le conseguenze avverse sull’innovazione," IRPPS Working Papers 94:2016, National Research Council, Institute for Research on Population and Social Policies.
    7. Alistair R. Anderson & Jialin Hardwick, 2017. "Collaborating for innovation: the socialised management of knowledge," International Entrepreneurship and Management Journal, Springer, vol. 13(4), pages 1181-1197, December.
    8. Haugstetter, Hilary & Cahoon, Stephen, 2010. "Strategic intent: Guiding port authorities to their new world?," Research in Transportation Economics, Elsevier, vol. 27(1), pages 30-36.
    9. Federico Frattini & Mattia Bianchi & Simone Franzó, 2019. "Identifying Factors Influencing The Price Of Technology Licenses: A Framework Grounded In Negotiation Research," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 23(05), pages 1-34, June.
    10. Schön, Benjamin & Pyka, Andreas, 2013. "The success factors of technology-sourcing through mergers & acquisitions: An intuitive meta-analysis," FZID Discussion Papers 78-2013, University of Hohenheim, Center for Research on Innovation and Services (FZID).
    11. Su, Taoyong & Yu, Yuzhu & Chen, Yongheng & Hou, Wanrong, 2023. "On or off: The triggering effect of underperformance duration on cooperative innovation," Technovation, Elsevier, vol. 126(C).
    12. Franz Huber, 2012. "On the Sociospatial Dynamics of Personal Knowledge Networks: Formation, Maintenance, and Knowledge Interactions," Environment and Planning A, , vol. 44(2), pages 356-376, February.
    13. Feng Zhang & Guohua Jiang, 2019. "Combination of Complementary Technological Knowledge to Generate “Hard to Imitate” Technologies," Journal of Information & Knowledge Management (JIKM), World Scientific Publishing Co. Pte. Ltd., vol. 18(02), pages 1-24, June.

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