To What Extent and in What Manner Do Chinese and Indian Contract Research Organisation Learn and Upgrade with the Unbundling the Global Pharmaceutical R&D Value Chain?
The focus of this paper is on the outsourcing of R&D activities to Chinese and Indian independently-owned contract research organisations (CROs) and the way these firms are becoming integrated as service providers into the global R&D function (or R&D value chain) of pharmaceutical MNCs. Above all the paper is concerned with the development of capabilities of CROs from these two countries and the dynamics of upgrading in GVCs in knowledge-intensive functions. The paper therefore discusses the role of both knowledge flows within global pharmaceutical R&D value chains as well as national innovation systems on the development of capabilities of Chinese and Indian CROs. Our analysis is based on data from semi-structured interviews collected from senior R&D managers from a sample of ten US and European pharmaceutical MNCs and owners and senior R&D managers from five Chinese and five Indian CROs who are providing research services to MNCs in this industry. We discuss the emergence of R&D outsourcing in this industry and the nature and mechanisms of knowledge flows within R&D value chains. The embeddedness of CROS in the national innovation systems of their home countries is also discussed.
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