Worlds Apart? a Comparison of the Npd Strategies of Biopharmaceutical Firms in Europe and the Us

Internationally, the biopharmaceutical industry is characterized by strong competition, research-intensive and protracted new product development (NPD) processes, intensive regulation and extensive alliance activity. Based on new comparative survey data, we compare the NPD strategies of US and European biopharmaceutical firms. Our data suggests four key empirical findings. First, while levels of R&D intensity and continuity are broadly similar in the two areas, US firms have notably stronger patent profiles and are significantly more active in technology licensing than their European counterparts. Second, product development cycles are significantly longer in the US than in European firms. Third, the nature of the product pipeline is very different in the US and Europe, with US firms conducting early stage development of more compounds than European firms but taking only a similar number to market. Fourth, we see broadly similar levels of alliance activity in the US and Europe at both the early and late stages of the NPD process. Our results suggest a greater substitution of „market‟ for „hierarchy‟ in the US industry, related perhaps to the availability and structure of government support in Europe.