Keywords: appropriability, diffusion, biotechnology, R&, D
New knowledge: production v. diffusion; the case of UK biotechnology
This paper looks at issues of appropriability and diffusion in UK biotechnology. It contrasts the various solutions to appropriability problems facing the production of R&D with the more intractable problems of diffusion, in particular across the university-industry divide. It focuses on issues of ownership of new knowledge between university and industry and argues that these, in practice, are relatively straightforward to solve. Issues of diffusion, on the other hand, depend on ease of movement between university and industrial careers, choice of project that scientists work on, ease of collaboration between universities and industry and the existence of networks of contacts between the two environments. With regard to such issues it is harder in the UK than in the USA for scientists to move between the two environments, to combine dual careers in academia and industry, for academic scientists to find industrial collaborators and for fluid networks to exist between the two environments. It is argued, however, that these difficulties in diffusion vary between different industrial sectors in their relations with the science base; certain sectors such as pharmaceuticals, diagnostics or instrumentation, are more receptive to ideas originating in the science base than are sectors such as food, or energy or to some extent chemicals. This may be due to different sources of innovation for the different sectors of biotechnology. If innovation originates in research as in pharmaceuticals or diagnostics, or with science base users, as with scientific instruments, companies are more receptive to links with the science base. If, on the other hand, more downstream processes or marketing innovations are more important, as in chemicals, food or energy, the large companies which dominate these sectors are less responsive to new knowledge occurring outside their own industrial sector and in the science base.