Revolutionary advances in basic science have generated radical shifts in the technology base of commercial activity: chemistry biology Dis-integration of the industry into specialized layers Emergence of new organizational forms (science-based entrepreneurship, AMCs), and supporting “infrastructure” (VCs, patent lawyers, university TLOs, etc.) Adaptation of incumbent firms, federal agencies, universities
FINDING THE ENDLESS FRONTIER: LESSONS FROM LIFE SCIENCES FOR ENERGY INNOVATION IAIN COCKBURN, BU AND NBER SCOTT STERN, NORTHWESTERN AND NBER JACK ZAUSNER, MCKINSEY & CO NBER ACCELERATING ENERGY INNOVATION CONFERENCE WASHINGTON, DC OCTOBER 2009
“ I will also ask for an appropriation of an extra $100 million to launch an intensive campaign to find a cure for cancer” (1971 SOTU)
The 1971 National Cancer Act provided budget for National Cancer Institute, ushering in a sustained and substantial Federal commitment to life sciences research
Let this be our national goal: At the end of this decade, in the year 1980, the United States will not be dependent on any other country for the energy we need to provide our jobs, to heat our homes, and to keep our transportation moving… to spur energy research and development, we plan to spend $10 billion in Federal funds over the next 5 years. (1974 SOTU)
The War on Cancer
During the 1970s, Federal programs directed significant attention and resources towards both energy and life sciences innovation….
Why have the experiences of the life sciences and energy innovation systems been so different?
The Power of Life Sciences Innovation Despite the complex nature of HIV/AIDS and high transmission potential, AIDS combination therapies developed in the early 1990s have dramatically reduced the AIDS death rate in the developed world
Incumbent firms have adapted to changes in industry structure, effectively accommodating new entrants and new technologies
Big Pharma appears not to have suffered from the structural rigidity and organizational inertia seen in other sectors
Commercialization grounded in flexible co-operative relationships across a wide variety of institutions
The Innovation Network may have hidden costs, but supports specialization, division of innovative labor, and exploitation of complementarities between public science, science-based entrepreneurship and traditional pharmaceutical companies
A tolerance for diversity and a willingness to adapt have been hallmarks of the life sciences innovation system. Effective institutions and infrastructure for life sciences research have emerged from an extraordinary amount of organizational and institutional experimentation—within which most initiatives fail.
Life Sciences innovation has distinct, perhaps unique features, that limit generalization
But this history suggests there is rarely a single “magic bullet” or “quantum leap” to address an issue as complex as climate change—innovation is a cumulative process and builds on multiple technologies and platforms
Faced with pressing social, human, and technological challenges the experience of the Life Sciences sector points to a powerful role for
sustained public investments in general-purpose platform technologies
support for diversity, experimentation and competition across a wide range of organizations and technologies