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Creative Disruption in Life Science Industries

This policy brief is based on: Joyce Tait, (2007) 'Systemic Interactions in Life Science Innovation', Technology Analysis and Strategic Management, Vol. 19, Issue 3, pp. 257-277

Outcomes of the Innogen Centre's research programme are relevant to policy makers, industry, stakeholder and public groups with interests in life sciences. This is one of a series of policy briefs designed for such audiences, based on our research publications but presented in a style that is accessible to non-academic audiences.

For more than ten years, analysts have been claiming that, despite a series of life science-based innovations, the overall drug discovery and development model of the pharmaceutical industry sector is fundamentally unsustainable. Explanations have included failure of innovative capacity, too great a focus on incremental rather than radical innovation, excessive regulation, and lack of venture capital investment.

However, from an alternative perspective, one could say that the innovation model that has evolved in the life science industry sector has been remarkably robust compared, for example, to those in information and communication technologies. Despite difficulties in markets, the emergence of a series of potentially disruptive innovations, the steady build-up of an onerous regulatory system, development costs approaching $1 billion per product and a product development life span of up to 12 years, the underlying business model of the industry sector has remained remarkably constant, and indeed has been reinforced, over the past fifty years. The dominance of the multinational corporations (MNCs) and their prevailing block-buster drug model of innovation has until now been unassailable.