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NovDec2012

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research Biotechs Must Learn To 'Swim with Sharks' RAMPANT MISTRUST between biotech and pharmaceutical firms may hinder innova- tion in the biotech industry, say Nandini Rajagopalan of the University of Southern California Marshall School of Business in Los Angeles and Luis Diestre of Instituto de Empresa Business School in Madrid, Spain. More new drugs could come to market if firms collaborated, but fear of idea theft leaves many medical discoveries undeveloped, the authors say. In the industry, biotech firms refer to R&D collabo- rations with big pharmaceuticals as "swimming with sharks." Patents and contracts can help prevent idea appropriation, but small biotechs have little chance to win infringement suits against wealthy pharmaceutical companies, the authors note. Rajagopolan and Diestre advise new biotech firms to partner with pharmaceutical firms involved in the fewest areas of medicine, which decreases the pharmaceutical firm's incentive to steal new ideas. In addition, they note UPCOMING & ONGOING n POINT-OF-SALE CRIME Researchers at the University of Arkansas' Walton College of Business in Fayetteville will work with the Retail Indus- try Leaders Association to address the potential for crim- inals to exploit retail technolo- gies such as mobile coupons and touchless payment. The goal is to create strategies to curtail potential crime before such emerging point-of-sale technologies become more widely used. 50 n BOOST FOR AFRICAN REAL ESTATE Henley Business School in South Africa, which is affiliated with the University of Reading's Henley Busi- ness School in the U.K., has opened its Centre for Advanced Studies in Real Estate in Africa (CASREA). CASREA's programs, initia- tives, and events will be dedi- cated to promoting effective and socially responsible practices in government and commercial real estate, as November/December 2012 BizEd well as urban and rural prop- erties. Dineo Molomo will direct the center. n FIGHTING ALZHEIMER'S The University of Western Ontario's Ivey School of Busi- ness in London, Ontario, has received funding from the Canadian government to cre- ate the Centre of Innovation Excellence for Alzheimer's Care, marking a new partner- ship between the federal gov- ernment, the Ivey International Centre for Health Innovation, and B'nai Brith Canada. The center will act as a lab where industry, academia, govern- ment, medical providers, and patients will work together to develop, test, and com- mercialize innovations related to the care and prevention of Alzheimer's disease. that biotech firms should realize that the more applicable the active ingredient of a drug is, the more money a partner could make from it—for that reason, working with an active ingredient with a narrow range of uses gives a partner less incen- tive to break the trust of the agreement. Finally, biotechs should seek the guidance of venture capitalists familiar with the industry. Even with the risks, culti- vating trusting relationships is necessary for innovation, the authors emphasize. In the 1990s, they note, 70 per- cent of blockbuster drugs were the result of collaborations between the biotech firms that made the discoveries and the pharma- ceutical firms with the funds to move those ideas forward. "Are All Sharks Dangerous? New Bio- technology Ventures and Partner Selection in R&D Alliances" was published in the October 2012 issue of the Strategic Man- agement Journal. Luis Diestre Nandini Rajagopalan

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