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GESTS423 Intellectual Property Management &

Technology Transfer Part I: Innovation: sources, drivers and models

Azèle Mathieu, PhD

February - June 2015

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RESEARCH BUSINESS

GESTS423 – Technology Transfer – © Azèle Mathieu

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RESEARCH BUSINESS

GESTS423 – Technology Transfer – © Azèle Mathieu

Innovation

• … is everywhere…on every mouth…

• Is it a buzzword?

• What does it cover?

• Why is it important?

• What is the place and the role of business developers in new systems of innovations?

• …

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GESTS423 – Technology Transfer – © Azèle Mathieu

Agenda

1) Definition

2) Sources

3) Models

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GESTS423 – Technology Transfer – © Azèle Mathieu

Sources of innovation

If innovation needs to be encouraged, what are the different sources of innovation?

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GESTS423 – Technology Transfer – © Azèle Mathieu

Sources of innovation

• Public sector:

– Higher education

• Education

• Research: fundamental and applied

– Public labs

• Business sector:

– The firm itself but also:

– Firms in the vertical chain, i.e. the CUSTOMER

– Firms in other industries

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Importance of looking beyond what is already known

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Source: Arthur D. Little, Prism 01/2011

GESTS423 – Technology Transfer – © Azèle Mathieu

New source of innovations: collective intelligence

• Crowdsourcing, e.g.:

– X-Prize: ask people to come up with technological solutions to a problem

http://www.xprize.org/

– Marblar: ask people to come up with problems that a given technology could solve http://marblar.com/ (ex.: http://marblar.com/challenge/Energy-Harvester)

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GESTS423 – Technology Transfer – © Azèle Mathieu

Agenda

1) Definition

2) Sources

3) Models

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What all these products have in common?

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From a “closed” innovation model towards…

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…a new model of innovation:

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Source: Chesborough, 2004

GESTS423 – Technology Transfer – © Azèle Mathieu

Comparison of both models of innovation based on knowledge transfer

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Source: Arthur D. Little, Prism 01/2010

GESTS423 – Technology Transfer – © Azèle Mathieu

The “open innovation” mindset:

• Importance of developing a network with bright people not working directly for us

• External R&D may be feed in internal R&D, synergies may be identified

• Building a better business model is better than getting to the market first

• Optimization of the IP rights (in/out-license non-core applications/areas)

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Source: Chesbrough (2003)

GESTS423 – Technology Transfer – © Azèle Mathieu

Final product Partner Type of partnerships

University In-licensing + R&D partnerships

Existing company + creation of a

company

Joint Venture

BASF

Butler Home Products

Purchase of the

technology Trademark licensing

Knowledge transfer: different types of interactions, different partners (1/2)

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Source: Procter and Gamble, Connect + Develop

GESTS423 – Technology Transfer – © Azèle Mathieu

Final product Partner Type of partnerships

oneCARE Out-licensing for manufacturing, distribution &

marketing activities

Marcolin

Trademark licensing

Knowledge transfer: different types of interactions, different partners (2/2)

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Source: Procter and Gamble, Connect + Develop

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GESTS423 – Technology Transfer – © Azèle Mathieu

Closed Innovation Principles Open Innovation Principles

The smart people in the field work for us. Not all the smart people work for us, so owe must find and tap into the knowledge and expertise of bright individuals outside our company.

To profit from R&D, we must discover it, develop it, and ship it ourselves.

External R&D can create significant value: internal R&D is needed to claim some portion of that value.

If we discover it ourselves, we will get it to the market first.

We don’t have to originate the research to profit from it.

The company that gets an innovation to the market first will win.

Building a better business model is better than getting to the market first.

If we create the most and the best ideas in the industry, we will win.

If we make the best use of internal and external ideas, we will win.

We should control our intellectual property (IP) so that our competitors don't profit from our ideas.

We should profit from others’ use of our IP, and we should buy others’ IP whenever it advances our business model.

Source: Chesbrough (2003)

The case of the pharmaceutical industry

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Source: Wyman (2011)

Fifth-year sales generated per $1 Billion spent on R&D

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Source: Oliver Wyman (2011)

Industry productivity has dropped more than 70%

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Source: Oliver Wyman (2011)

Issues facing the pharma industry

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Decrease in productivity:

Increase of R&D expenditure

Decrease of approved NMEs

Decrease of sales/ NMEs

Major patents falling in the public domain

Need to reconsider its business model

Need to find new sources of innovation

GESTS423 – Technology Transfer – © Azèle Mathieu

Towards a new value chain

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Source: IMAP

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References (1/3)

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(2013). Big Bang Disruptions, Harvard Business Review

Chasm Institute. http://www.chasminstitute.com/METHODOLOGY/TechnologyAdoptionLifeCycle/tabid/89/Default.aspx

Chesbrough, H.W. (2003). Open Innovation: The New Imperative for Creating and Profiting from Technology. Harvard Business School Press.

Chesbrough, H.W. (2006). Open innovation: a new paradigm for understanding industrial innovation. In Chesbrough, H.W., Vanhaverbeke, W. and J. West (eds), Open Innovation:Researching a New Paradigm. Oxford University Press.

Christensen, C. (03/11/2012). A Capitalist’s Dilemma, Whoever Wins on Tuesday. The New York Times.

Cohen, W.M. and D.A. Levinthal (1990). Absorptive Capacity: A New Perspective on Learning and Innovation. Administrative Science Quarterly, 35(1), pp.128-152.

Europe Enterpise Network, http://een.ec.europa.eu/

GESTS423 – Technology Transfer – © Azèle Mathieu

References (2/3)

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Etzkowitz, H. and L. Leydesdorff (2000). The dynamics of innovation: from National Systems and “Mode 2” to a Triple Helix of university–industry–government relations, Research Policy, 29 (2), pp. 109-123.

European Communities – Gate 2 Growth (2002). A Guide to Financing Innovation.

Geuna, A. (2001). The Changing Rationale for European University Research Funding: Are There Negative Unintended Consequences? Journal of Economic Issues, 35 (3), 607-632.

McKinsey Global Institute (2013). Disruptive technologies: advances that will transform life, business and the global economy.

Mowery D.C., Nelson R.R., Sampat B.N. and A.A. Ziedonis (2001). The growth of patenting and licensing by U.S. universities: an assessment of the effects of the Bayh–Dole act of 1980. Research Policy, 30 (1), 99–119.

OECD - Oslo Manual: Guidelines for Collecting and Interpreting Innovation Data, 3rd Edition.

GESTS423 – Technology Transfer – © Azèle Mathieu

References (3/3)

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Pavitt, K. (1980). Industrial R&D and the British economic problem. R&D Management, 10, 149.

Perkmann M. and K. Walsh (2008). Engaging the scholar: Three types of academic consulting and their impact on universities and industry. Research Policy, 37, 1884–1891.

Perkmann M. and K. Walsh (2009). The two faces of collaboration: impacts of university-industry relations on public research. Industrial and Corporate Change, 1-33.

Procter and Gamble, Connect + Develop http://www.pgconnectdevelop.com/home/pg_open_innovation.html

GESTS423 – Technology Transfer – © Azèle Mathieu