Dramatic advances in genomics and rapid progress in the Human Genome Project have resulted in a vast number of therapeutic targets available to researchers in traditional pharmaceutical and biotech companies that aim to join or serve the pharmaceutical industry. Consequently, the total number of new drug projects and the expenditure of research and development (R&D) worldwide have increased dramatically in this decade. However, despite the rising efforts (time and money) in the industry, the actual number of new drugs that reached the markets is declining year by year. To reveal the significance of strategic alliance to the value chain of biotech and pharmaceutical (bio/pharma) industry, this report reasons the demand of external R&D resources in the present circumstances through reviewing literature of bio/pharma R&D collaboration and recent news of the restructuring in this sector. This report further identifies the advantages and disadvantages of strategic alliances to bio/pharma firms by comparing with other transactions, such as mergers and acquisitions and licensing. In the circumstances of the globalizing drug market, Western bio/pharma firms are faced with strong challenges by confining their businesses to domestic markets. In addition, as many developing countries now have the honed skills and knowledge in drug discovery and development, intense competition now comes from all over the world. The later part of this report thus aims to discover whether Western bio/pharma companies could strengthen their competitiveness through the R&D collaboration with those in developing countries (the case of Asia). By detailing the biotech promoting policies and iv incentives, the development of human capital and the overall bio/pharma environment in China, India, Singapore and Taiwan, this report provides a comprehensive analysis of opportunities and threats to Western bio/pharma companies through the Western-Asian partnerships. Finally, in light of the complex value chain of drug development, this report presents the different specialties of these Asian countries and suggests the most functional and profitable types of collaboration for the Western bio/pharma companies.
Research Project (M.B.A.) - Simon Fraser University
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Thesis advisor: Soh, Pek-Hooi
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