This thesis investigates the 25-year transitional process of the Korean pharmaceutical industry from its initial focus on the imitative production of generic drugs to the development of new drugs. The catch-up dynamics of latecomer countries in science-intensive industries, such as the pharmaceutical industry, is an overlooked research topic in existing literature on innovation studies. This thesis provides an in-depth analysis of Korea's science-intensive catch-up and applies an ‘exploration and exploitation' framework to a latecomer setting and in a novel institutional and market context of the transitional phase. This thesis argues that the rate of change in the transition from imitating drugs to developing new drugs depends on the institutional and organisational mechanisms that enable a new form of technological learning, termed ‘exploratory learning'. This form of learning is often unfamiliar to firms in latecomer countries, whereas it is necessary for producing innovative drugs. That is, latecomers' institutional and organisational promotion of exploratory learning is related to a ‘pattern change' in the previously established institutional and organisational routines associated with imitative learning. The findings show that the rate of industrial transition in this sector was constrained by the problematic operation of S&T policies promoting key characteristics of exploratory learning, such as high-risk long-term learning as well as dense interactions between a diverse number of innovation actors. The findings also illuminate some latecomer firms' initial difficulties in managing the new mode of technological learning, and in strategically applying that mode of learning to overcome the barriers to moving through the transitional phase towards producing competitive innovation. The thesis also suggests that the nature of drugs as integral products, deeply grounded in science, makes it difficult to effectively promote institutional and organisational transformations in favour of exploratory learning.

From the 1980s onwards pharmaceutical manufacture evolved from a fragmented industry to a global oligopoly. In the ecology literature coevolution theory proposes that V competing species (incumbent firms) interact and shape each others’ development, and V that this in turn potentially shapes the community (industry) structure. This suggests that when exploring how firms’ strategies changed during a period of significant industry change it is important to understand processes of both strategy evolution and coevolution in order to understand the dynamics of strategic change. This led to the research question ‘How did the realised strategies of a heterogeneous set of firms coevolve during the period of pharmaceutical industry consolidation from 1992-2002?’ In order to answer this a categorisation of strategic actions realised by firms in the pharmaceutical industry was developed. This was used as the basis of a methodological framework which used qualitative document analysis to longitudinally analyse how the grand strategies and strategic actions of a set of six pharmaceutical firms evolved and coevolved. These firms had arrived at different strategic outcomes and were selected using purposive sampling and replication logic. For the period 1992-2002 it was found that each firm realised unique patterns of grand strategy evolution. Further, the strategic actions that formed realised strategies coevolved both with the strategic actions of other firms and with the structure of the pharmaceutical industry as it became increasingly consolidated and globalised. Contributions to theories surrounding the environmental determinism versus strategic choice debate have been made with the findings supporting theories of coevolution, incremental and emergent strategy, and temporal patterns in strategy development. New contributions to knowledge were the development of a theory of pharmaceutical industry coevolution, development of a methodological framework for understanding strategic change in the pharmaceutical industry, and the creation of techniques to aid strategic decision making

No description available.