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Open Innovation in Pharmaceutical Industry: A Case Study by Eli Lilly


Interest on Open Innovation paradigm has seen a phenomenal increase since last two decades, especially when Henry Chesbrough coined this term in 2003, triggering the creation of a new whole body of knowledge. However, all of his research work could not come up with a standardized, all-in-one theory. Instead, we find a heterogeneous series of models that cope up with different aspects and fit into specific contexts and industries. Among these empirical experiences of Open Innovation, we found it in the pharmaceutical industry. The shift to Open Innovation in Pharmaceutical industry presents several particularities, like the need to overcome the current productivity crisis as driver for change, or the R&D-intensive nature of the industry. In this scenario of urgency, the lack of a well-established theoretical model on Open Innovation makes difficult for the task of implementing this paradigm.

In this research, we explore in detail the process of adoption of Open Innovation in the pharmaceutical industry through a case study, and analyze the empirical findings by framing it inside the current theoretical framework. Through this analysis, we aim to highlight generalizing patterns, and specific elements from the current body of knowledge. These highlights might serve as input for the creation of a unified model of Open Innovation.


Pharmaceutical industry is a highly innovation driven, which throughout its history has contributed to the well-being of the humans by providing new medicines to address various diseases and have grown into one of the major business sectors in the world. The global pharmaceutical industry is touted to be worth US$ 300 billion with few drug companies controlling almost one third of the market (World Health Organization, 2015). These few companies are termed as the “Big pharma” have been thriving in the market by pouring investments in R&D and commercialize high value “popular drugs”. A pharmaceutical company can categorized as a Big Pharma based upon four criteria, namely the combined sales per year which should be all above 2 billion USD, vast global presence which includes advanced countries like USA, UK, France, Germany and Japan, involvement in several therapeutic areas with R&D and marketing in at least five different therapeutic areas and an establishment of fully integrated pharmaceutical operations including internal R&D, manufacturing, clinical trials, regulatory, marketing and sales.

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