Beyond the Blockbuster Model? Personalised Medicine as Driver for New Business Models in the Pharmaceutical Industry
Proceedings of the R&D Management Conference: Value Creation and Value Capture, Genoble, France, 23-25 May 2012
13 Pages Posted: 5 Oct 2012
Date Written: 2012
The pharmaceutical industry stands at a turning point: As pipelines for new blockbuster candidates are dry and patents for old blockbusters are running out, how can pharmaceutical activity remain profitable? The choice is either between holding on to the blockbuster model, which was profitable in the past, but won’t be sustainable in the future or going with the new trend of developing medicines for smaller patient groups (personalised medicine), where return on R&D activity is not as profitable as for blockbuster drugs, but is likely to continue into the future? In this article we argue that the reason why the pharmaceutical industry has not responded to this trend in the industry yet is because of its dominant industry logic, which impedes the realisation and action against threats as well as opportunities. We identify and categorise the barriers and drivers of change related to the dominant industry logic, but most importantly, give recommendations of how these barriers can be overcome by pharmaceutical firms.
Keywords: Business Model Innovation, Personalised Medicine, Pharmaceutical Industry, Sector innovation, Dominant Industry Logic
JEL Classification: L65, O3, I11
Suggested Citation: Suggested Citation