Technology strategies for innovation race: a simulation model for pharmaceutics

Abstract

In this article we will analyze a knowledge–based model of the firm that makes it possible to analyze how the firms can build up their technology strategies to capture profits from innovation race. The importance of different knowledge–based determinants will be analyzed in the context of pharmaceutical industry. We will look at the relevance of different value creating and value protecting determinants of firms and show how different technology strategies (offensive and defensive) affect the net value derived from knowledge assets in different competitive settings. The dynamics behind different strategies will be analyzed using stochastic simulation models.