Business models and Open innovation the case study of an open

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					               Business models and open innovation: the case study of an open
                           technology platform in the European biotechnology




Business models and Open innovation: the
case study of an open technology platform
in the European Biotechnology sector
                                       Valérie Sabatier, PhD candidate,
                                 Grenoble Applied Economic Laboratory,
                                            Univ. Pierre Mendès France,
                                                          Protein’eXpert
                                     valeriesabatier@proteinexpert.com




                           Valérie Sabatier
          Workshop Open Innovation -Cambridge, UK, May 2008.
                                     Business models and open innovation: the case study of an open
                                                 technology platform in the European biotechnology



What is a Business Model?

  We define business models as pictures of firms
  showing their position on the value chain
  (Schweizer 2005), the way they create and capture
  value (Chesbrough 2007).
  Chesbrough H.W. (2007). "Why companies should have open Business Models " MIT Sloan Management Review 48(2)

  Schweizer L. (2005). "Concept and evolution of business models " Journal of General Management 31(2): 37-56.


  The value chain of drugs


      Research &           Preclinical
                                                Phase I           Phase II         Phase III          Market
     Drug Discovery         studies


                                                Valérie Sabatier
                               Workshop Open Innovation -Cambridge, UK, May 2008.                                1/8
                            Business models and open innovation: the case study of an open
                                        technology platform in the European biotechnology



Protein’eXpert: Identity card
Protein’eXpert : incorporated in 2000
Spin off from CEA-CNRS, located in Grenoble
R&D services for recombinant protein production


           The service business model
        PX’Pharma : integrated subsidiary created in 2004
        Unique French site for GMP biomanufacturing in bacteria & yeast

                       The production business model
PX’Monoclonals: subsidiary created in 2007
Technology platform dedicated to murine and humanized
 monoclonal antibodies development. Located in Lyon.

              The service business model
                                        Valérie Sabatier
                       Workshop Open Innovation -Cambridge, UK, May 2008.              2/8
                             Business models and open innovation: the case study of an open
                                         technology platform in the European biotechnology



The open technology platform business model
  Position on the value chain:
                   Open Techno PF


             Research &      Preclinical
                                           Phase I       Phase II      Phase III   Market
            Drug Discovery    studies



  The open technology platform offers critical technological
  developments to drug developers.
     High value-added services;
     Highly skilled people team: major influence of know-how;
     But requires a special agreement regarding IP.


                                       Valérie Sabatier
                      Workshop Open Innovation -Cambridge, UK, May 2008.                    3/8
                         Business models and open innovation: the case study of an open
                                     technology platform in the European biotechnology



Protein’eXpert: a picture


                              Transfer
       Protein’eXpert
                                                      Manufacturer




                           Client: a drug developer
   Research & Preclinical
                                Phase I          Phase II       Phase III   Market
  Drug Discovery studies



                                     Valérie Sabatier
                    Workshop Open Innovation -Cambridge, UK, May 2008.               4/8
                      Business models and open innovation: the case study of an open
                                  technology platform in the European biotechnology



What does ‘open’ mean for PX?
  No patent:
    Neither for licensing-in,
    Nor for licensing-out.
  The client does not possess the rights on the
  technology (he has got a right on the product): no
  exclusivity.
  The client does not pay for an access to a
  patented technology.
  PX can re-use everything that have been
  developed for any specific project.
                                  Valérie Sabatier
                 Workshop Open Innovation -Cambridge, UK, May 2008.              5/8
                     Business models and open innovation: the case study of an open
                                 technology platform in the European biotechnology



Intellectual Property and Innovation

  Innovation comes from :
    Expired patents
    Programs of technological R&D previously developed
    from client projects.
    Scientific publications
  Internal know-how: a core competence, necessary
  to have access to public technology and being able
  to develop it. It also « protects » what the open
  platform creates.

                                 Valérie Sabatier
                Workshop Open Innovation -Cambridge, UK, May 2008.              6/8
                           Business models and open innovation: the case study of an open
                                       technology platform in the European biotechnology



Value creation and value capture
        Value creation                                         Value capture


 • A critical technological                       • Price of the service, milestones,
   development for a client                         royalties
 • Exploiting loose knowledge                     • Time savings
 • Improvement/combination                        • Cost savings
   of knowledge
                                                  • New basis for a possible new
 • Re-use of technology development
                                                  activity



                                       Valérie Sabatier
                      Workshop Open Innovation -Cambridge, UK, May 2008.                7/8
                    Business models and open innovation: the case study of an open
                                technology platform in the European biotechnology



Conclusion

  Most important features:
    Know-how
    Network
    Complementary with other business models
  Open innovation in a choice for upstream process
  and an obligation for downstream process.
  A world of IP rights: cost of access
  « The product depends on the process »


                                Valérie Sabatier
               Workshop Open Innovation -Cambridge, UK, May 2008.             8/8