Governance, policy, and industry strategies: pharmaceuticals and agro-biotechnology

The emergence of new fundamental knowledge in life sciences is leading to new, "breakthrough" technologies, completely new product ranges, and new innovation trajectories. Some breakthrough technologies are potentially disruptive (Spinardi and Williams, 2005), in the sense that they step outside existing paradigms, requiring a major shift in product types and in their place in the market. Examples include GM crops in agro-biotechnology, and stem cells and pharmaco-genetics in the pharmaceutical industry. The shift of emphasis from innovation based on chemical knowledge to biotechnology-based pathways creates turbulence in companies' internal product development strategies, changes the balance of competitiveness among companies, and opens up new areas of regulatory uncertainty. At the same time, governance processes are becoming more complex and are placing greater constraints and uncertainties on companies that have made major investments in the development of new types of product over long periods of time. This chapter is based on a series of research projects we have conducted to study innovation in pharmaceutical and agro-biotechnology companies and the interactions between: science, technology, and innovation strategies in multinational companies (MNCs); policy development, risk regulation, and governance; and public and stakeholder attitudes and concerns. The background for this research has been the emergence of new governance structures and policy processes in Europe and North America (Giddens, 1999; Cabinet Office, 1999a; Commission of the European Communities, 2001).