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Worlds Apart? A Comparison of the New Product Development Strategies of Biopharmaceutical Firms in Europe and the USA

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  • Tianjiao Xia
  • Stephen Roper

Abstract

Globally the biopharmaceutical industry is characterized by strong competition, research-intensive and protracted new product development (NPD) processes, intensive regulation and extensive alliance activity. Policy regimes and operating environments differ markedly, however. Here we examine how these differences impact on the NPD strategies of biopharmaceutical firms in the USA and three major EU economies (the UK, France and Germany). Our analysis suggests four key differences between firms' NPD strategies in the two areas. First, while levels of R&D intensity and continuity are broadly similar in the two areas, US firms have notably stronger patent profiles, and are significantly more active in technology licensing than their European counterparts. Second, product development cycles are significantly longer in the USA than among our European respondents. Third, the nature of the product development pipeline is very different in the USA and the major European economies covered by our study: US firms conduct early stage development of more compounds than European firms but take only a similar number to market. Fourth, we see broadly similar levels of alliance activity in our US and European respondents at both the early and late stages of the NPD process. These results suggest a greater substitution of “market” for “hierarchy” in US firms' NPD strategies, reflecting differences in the availability and structure of government support in the USA and Europe.

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File URL: http://www.tandfonline.com/doi/abs/10.1080/13662710903371108
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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Industry and Innovation.

Volume (Year): 16 (2009)
Issue (Month): 6 ()
Pages: 593-612

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Handle: RePEc:taf:indinn:v:16:y:2009:i:6:p:593-612

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Related research

Keywords: Biopharmaceutical; USA; Europe; comparative analysis;

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