MorphoSys AG: The Evolution of a Biotechnology Business Model

Abstract

In the biotech world, the 18-year-old Munich-based company MorphoSys was a rarity: it was profitable. The company achieved this profitability not by developing and selling its own drugs, but by licensing access to its proprietary library of human antibodies. Recently, the company decided to deviate from this model, and attempt to develop its own proprietary products. The case allows analysis of "license vs. vertically integrate" business model decisions, and can be used to teach principles of business model design and the functioning of markets for know-how.

Learning Objective: The case can be used to explore issues surrounding business model design for your companies. Specifically, it enables students to analyze a decision whether to move from a platform technology/licensor model to a proprietary product company. Related issues for analysis include the appropriate way to manage the risk of such a transition and shareholder expectations.