INNOVATION MODELS IN THE BIOPHARMACEUTICAL SECTOR - Innovation in the Biopharmaceutical Industry - page 8

(1994) characterised the evolution of biotechnology as a process involving three
successive waves of such changes, as shown in Fig. 2.
Although research within the third bio-molecular wave has been underway for
over two decades (Sharpe et al. , 1994), experience of long waves of industrial devel-
opment suggests that this massive new knowledge base will translate slowly and
unevenly into practical innovations. Many people are frustrated by the slow rate at
which new knowledge translates into innovations, especially in the face of social and
economic pressures for better treatments of serious diseases, such as cancer, rheuma-
toid arthritis, Alzheimer's and AIDS. (Nightingale and Martin, 2004) Simple cou-
pling models, though useful as a starting point, offer no guarantees of timely success.
We are faced by a paradoxical situation. The long-term potential at the “front
end” of the innovative process appears to be bright, but the short-term innovative
output of new products at the “back end”, as measured by NME licenses granted,
continues to decline (Charles River Associates, 2004).
Systems and boundaries
Systemic models offer a valuable way to order and structure innovative processes.
A key feature of the definition of any system is its boundaries. What is within the
system as an interactive component, and what is outside and hence part of its external
environment? Differing concepts regarding the identification of the component parts
of the innovation process and how widely the boundaries are set can lead to quite
different conclusions.
The word innovation offers considerable scope for alternative interpretations.
Consider the following three definitions:
1. Innovation is the process of discovering something that is both new and poten-
tially useful.
2. Innovation is the process of discovering something new and developing it into a
saleable product or service.
3. Innovation is a cyclical economic process, whereby innovators discover, develop
and commercialise new products or services and gain sufficient returns on their
investments to re-invest in continued R&D.
In the public policy debate on bioscience, the first definition above, which, strictly
speaking, refers to “invention”, is commonly used to define “innovation”. This can
lead to the erroneous view that all that is needed to promote innovation is to stimu-
late more basic scientific and technological inventions; this is a commonly shared
view within the EU context. Even in the specialist literature, the innovation pro-
cess is often limited to the discovery, development and manufacturing processes
as in the second definition above, with marketing activities and competences seen