Pursuing a biotechnology system of innovation in Lithuania: a conceptual framework for effective policy intervention

The focus of this paper is on Lithuania, whose government released an ambitious innovation strategy which states that by 2015 it would become an innovative services hub for Northern Europe and an innovation hub by 2020. Biotechnology has been identified as a strategic sector, and whether Lithuania will be able to achieve its ambition of a fully-functioning biotechnology sectoral system of innovation will be explored. Lithuania is a green field site for innovation policy with the potential for development, but equally faces many challenges such as limited entrepreneurial culture and inexperienced investors. With the Lithuanian government declaring that they will intervene to achieve their innovation goals, this paper argues that sound policy intervention is possible and can be done in a way that avoids the limitations of past systemic approaches (Uyarra, 2010; and Uyarra et al, 2010). The policy approach presented is based on a modified Extended Industry Life Cycle (Avnimelech and Teubal 2006) and the movement of system structures and behaviours through life cycle phases – background, pre-emergence, and emergence – and explains how each phase of the Lithuanian experience lays the groundwork for development to the next phase.