Measuring Competence? Exploring Firm Effects in Drug Discovery

Rebecca Henderson and Iain Cockburn

in The Nature and Dynamics of Organizational Capabilities

Published in print November 2001 | ISBN: 9780199248544
Published online November 2003 | e-ISBN: 9780191596155 | DOI:
 Measuring Competence? Exploring Firm Effects in Drug Discovery

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The chapter explores the role of ‘competence’ in pharmaceutical research. It provides support for the existence of sources of heterogeneity highlighted by the resource‐based view of the firm by showing that the large proportion of the variance in research productivity across firms could be attributed to firm‐specific effects. Drawing on detailed qualitative data about the history of research at each of the firm in the sample, a variety of measures of ‘competence’ was constructed. The result of the analysis suggests that ‘architectural competence’, as captured by indicators of the firm's ability to knowledge integrativity, is positively associated with research productivity. Besides that, it is shown that firms that maintain links to the wider scientific community through the use of publication in the open literature as a criterion of promotion, and firms that manage the allocation of key research resources through collaborative rather than dictatorial processes are significantly more productive in drug discovery.

Keywords: collaboration; competencies; drug discovery; heterogeneity of firms; pharmaceutical industry; productivity; publication; research; scientific community

Chapter.  13554 words. 

Subjects: Microeconomics

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