Re-organizing R&D for innovation – latest trends in biotech and chemicals

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Talking to people in chemical and biotech-pharma  is painting a new picture of re-organizing the research work-force for invention and discovery in biological,pharmaceutical, agro-chemical and chemical industry in the US.

Increasingly, organizations with large PhD scientist forces are realizing that they are not entrepreneurial enough when compared to the smaller, more entrepreneurial,  say bio-tech firm. In other words, keeping with established new product development theory large organizations are realizing that they are not able to really deal with the fuzzy front-end of innovation. Bigger organizations have just too much of bureaucracy and politics to allow entrepreneurial action in-house that is absolutely required for the fuzzy front end.

When it comes to product design- organizations have used product design firms like IDEO for products from tooth brushes to electronic gadgets.In contrast,advanced chemical and pharmaceutical discovery involves huge domain knowledge gathered over years of meticulous lab work that are  proven through scholarly publications.

Bigger organizations in the US are deciding to stay with their basic managerial skills like say supply chain and marketing ,distribution that are highly embedded and relational ( eg. you know the doctors and pharmacies where you will sell the pharmaceutical  product, you have the processes and people in place) but are going in for simply buying a promising drug from a smaller biotech firm that employs say 5 scientists. It's far more cheaper to buy a relatively more developed idea than try to do it from scratch in the large organization employing 150 scientists.The biotech firm that succeeds in finding a buyer for its invention experiences a similar windfall like the Internet boom-time of the late 1990's.

How exactly, the post-doctoral employment of scientists will pan out in the future, is not yet clear. In the past, many PhD's in the sciences could find employment in large firms that would afford a long "no-marketable discovery" career. This is changing….

We wonder if  smaller biotechs would be able to afford fresh PhD's….. and yet keep up scientific work at Universities that contribute to theory and not put too much pressure on immediate market application. Interesting to watch as we go forward and innovation accelerates in the biological,chemical and pharmaceutical space.