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Title
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Towards a more nuanced understanding of the firm-level determinants of radical drug innovations
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Author
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Abstract
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| Radical drug innovations have contributed to an important increase in life expectancy globally during the past 100 years. One well-known example of a radically innovative drug is the first antibiotic Penicillin, which was discovered in 1928. Since then, millions of lives have been and are still saved by antibiotics. However, there are currently still many diseases, such as Alzheimer’s disease and various types of cancer, that have a high prevalence and an enormous unmet medical need because there are neither disease-modifying nor preventive pharmaceutical drugs available for them, despite massive investments in relevant research and development (R&D) areas. Thus, more radically innovative drugs are needed. However, the rate of radical drug innovation has been declining since the second half of the 20th century, despite increasing investments in pharmaceutical R&D. Understanding the firm-level determinants involved in successful radical drug innovations is key to increasing this type of output in the future. Research to date has not provided a solid understanding of why so few firms succeed in developing radical drug innovations while many others do. In addition, research results have not offered any conclusive evidence about which factors are critical for the successful development of radical drug innovations (versus incremental ones). The current research takes up this challenge by focusing on the following four research gaps identified in the current literature on radical drug innovation: 1) definitional ambiguity, 2) unvalidated measures, 3) limited understanding of firm-level determinants, and 4) oversimplified conceptualization of the relationship between some firm-level determinants and radical drug innovation. More specifically, a definition of radical drug innovation based on novelty and therapeutic impact is introduced. Moreover, empirical evidence of the limitations currently associated with radical drug innovation measurement is provided and discussed. Given the identified limitations with the current measures of radical drug innovation, a new method based on the German health technology assessment (HTA) approach is offered. We argue that this validated measure will enhance our ability to understand radical drug innovation and its firm-level determinants, to compare results across studies, and to stimulate additional research on the topic. Second, in Chapter 3, we present the results from our search of the literature for key firm-level determinants of radical drug innovation. Following a systematic literature review approach, we considered more than 4,100 peer-reviewed journal articles and PhD theses, 38 of which were included in the narrative synthesis. From this review, we offer a conceptual framework of critical determinants of radical drug innovation and highlight managerial and research implications. Third, in Chapter 4, through semi-structured interviews with pharmaceutical R&D experts from the United States, Switzerland, the United Kingdom, and Germany, the current knowledge about firm-level determinants of radical drug innovation, at a more granular level, is further extended. |
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Language
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English
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Publication
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Antwerp
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University of Antwerp, Faculty of Business and Economics
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2021
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Volume/pages
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179 p.
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Note
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Cambré, Bart [Supervisor]
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van Witteloostuijn, Arjen [Supervisor]
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Full text (open access)
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