How Japanese Companies Access Emerging Technology

By P Reed Maurer

During the 1980s, Japanese pharmaceutical researchers came out of nowhere to lead the world in the discovery and launch of New Chemical Entities. Their NCEs were typically second and third generation innovations that were highly regarded in Japan but rarely marketed in the USA and Europe.

Now, the economic rewards for small step innovations in Japan are history. Government-regulated reimbursement policies will not bestow high prices on minor modifications of older drugs. NCEs must be attractive outside Japan to justify research expenditures. Insurance societies preach a new message of more research and less promotion. These factors are forcing Japanese executives to restructure the focus of their research efforts away from a follow-the-leader strategy toward innovative or breakthrough drug discovery research.