The Effect of Longer Development Times on Product Pipeline Management Performance
Main Article Content
Abstract
In the pharmaceutical industry, value is being destroyed through longer product development times. Given that patent lives are (normally) fixed at 20 years, the double hit of increasing time to market is evident - higher R & D costs and less time at market before generic competitors are able to be released into the marketplace. The Policy implications are massive: A huge and permanent shift away from internal R & D towards partnerships, licensing deals and acquisitions of more innovative biotechnology companies. In this study, we build a system dynamics model of the product development pipeline for a single company operating in the pharmaceutical market. The study shows that in the presence of loss of value due to longer lead times, it is more advantageous to: (a) work faster to reduce the backlog of projects; (b) increase the number of projects started whenever it is possible reduce complexity in the pipeline; and also (c) the optimal decision on resource allocation is independent of the loss of value due to longer lead times.
Downloads
Download data is not yet available.
Download data is not yet available.
Article Details
How to Cite
Figueiredo, P. S., Travassos, X. L., & Loiola, E. (1). The Effect of Longer Development Times on Product Pipeline Management Performance. Journal of Contemporary Administration, 19(4), 461-485. https://doi.org/10.1590/1982-7849rac20151430
Section
Articles
This journal remains the copyright holder of articles published. In order to be published, authors must sign the Transfer of Copyrights Document, which is sent to the authors by e-mail, thus granting rights, including on translation, to the Journal of Contemporary Administration. The journal grants third parties the right to use, reproduce, and share the article according to the Creative Commons license agreement (CC-BY 4.0), as stated in the article’s PDF documents.