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The evolution of the pharmaceutical-biotechnology industry


  • Hans-Werner Gottinger
  • Celia Umali


This paper presents an application of network economics to the formation of alliances in the biotechnology-pharmaceutical industry. The framework analysis provides insights under which firms create hybrid governance forms, integrate strategy and economics into a more holistic perspective on network strategy. Firm network types link network economies, competencies and market structure, creating integration between participants and change as additional dimensions. 'Change' introduces a dynamic, evolutionary aspect. The resulting contructs involve the network dimension as a mechanism design for investigating the evolution and life cycles of firm networks. An analysis of alliances within the pharmaceutical and biotechnology industries develops the framework, including a historical tracing, and an empirical examination of the relationship between collaboration rate (CR) and market performance of major globally operating pharmaceutical firms. Case examples, supported quantitatively and qualitatively, provide evidence for the efficacy and implications of the network dimension.

Suggested Citation

  • Hans-Werner Gottinger & Celia Umali, 2008. "The evolution of the pharmaceutical-biotechnology industry," Business History, Taylor & Francis Journals, vol. 50(5), pages 583-601.
  • Handle: RePEc:taf:bushst:v:50:y:2008:i:5:p:583-601
    DOI: 10.1080/00076790802246020

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    Cited by:

    1. Krogmann, Yin & Riedel, Nadine & Schwalbe, Ulrich, 2013. "Inter-firm R&D networks in pharmaceutical biotechnology: What determines firm's centrality-based partnering capability," FZID Discussion Papers 75-2013, University of Hohenheim, Center for Research on Innovation and Services (FZID).
    2. Jackie Krafft & Francesco Quatraro & Pier Saviotti, 2014. "Knowledge characteristics and the dynamics of technological alliances in pharmaceuticals: empirical evidence from Europe, US and Japan," Journal of Evolutionary Economics, Springer, vol. 24(3), pages 587-622, July.


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