When it comes to collaboration on research and development (R&D), the pharmaceutical industry isn’t known for sharing knowledge among companies. However, the high cost of developing new drugs combined with declining R&D productivity over the past 20 years have transformed the industry to one that is embracing the notion of collaboration in order to create innovations.
Under a recently funded National Science Foundation (NSF) grant, Paul Olk, senior associate dean at the Daniels College of Business will join Joel West, professor of innovation, intellectual property and technology entrepreneurship at the Keck Graduate Institute to conduct the first large-scale study of open R&D consortia. Such consortia allow members and nonmembers to share pre-competitive R&D—and Dr. Olk says that many of the world’s leading pharmaceutical companies have joined multiple groups.
“Collaboration has historically been a challenge for this industry, so our goal is to understand what pharmaceutical cooperation—the open R&D consortia—looks like and how pharma companies are managing their own propensity to protect their intellectual property,” says Dr. Olk, who is the co-principal investigator of the NSF grant. Dr. Olk has an extensive research background in the formation, management and performance of strategic alliances, studying R&D collaborations in a variety of industries, including semiconductors, computers and telecommunications while Dr. West’s research focuses on how firms use openness to grow their market and gain competitive advantage.
In their three-year study, the professors will focus on building a database of the consortia that currently exist for pharmaceutical companies, conducting interviews of managers in corporations and consortia to understand the attributes and goals of the consortia, and surveying key stakeholders (i.e. pharmaceutical company representatives) in their database. When finished, they plan to make the database available to practitioners and researchers. Dr. Olk says that the team also plans to create case studies that delve into key consortia attributes. “Overall, we want to answer the question of why pharmaceutical companies are now doing this and how they can overcome some of the challenges inherent with open innovation to result in best practices going forward.”
Dr. Olk explains that in answering this question, the research will provide deeper insights into the dynamics of multi-party collaborations and a better understanding of the role that open R&D consortia play in the pharmaceutical innovation process. If successful, these consortia might benefit the pharmaceutical firms through faster or better innovations and impact the ultimate goal of improving health outcomes.
This is the third NSF grant that Dr. Olk has received. The research, titled “Open R&D Consortia: Open Innovation Alliances in the Pharmaceutical Industry,” was funded under the NSF’s Science of Science and Innovation Policy Program.
Dr. Olk will present his work at the August 2016 Academy of Management Meetings.