American Journal of Industrial and Business Management, 2013, 3, 565-572
http://dx.doi.org/10.4236/ajibm.2013.36065 Published Online October 2013 (http://www.scirp.org/journal/ajibm) 565
Strategy of Innovation’s Management in the
Pharmaceutical Industry Holds Intellectual Property
Cássia Rita Pereira da Veiga, Claudimar Pereira da Veiga, Jansen Maia Del Corso,
Anderson Catapan
Business School, Pontifical Catholic University of Paraná, Curitiba, Brazil.
Received August 2nd, 2013; revised September 2nd, 2013; accepted October 5th, 2013
Copyright © 2013 Cássia Rita Pereira da Veiga et al. This is an open access article distributed under the Creative Commons Attribu-
tion License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly
cited.
ABSTRACT
In the management of innovation, intellectual property rights assume the primary role. In this sense, this paper aims to
describe, with examples, the various strategies used by the pharmaceutical industry in the preservation of their legiti-
mate rights of the intellectu al property system. This is an explor atory study by using do cumentary research and longitu-
dinal time. Even with the difference in laws between countries, the pharmaceutical anti-competitive practices gain more
space in the glob al economy. For patents become political too ls that foster innovation and diffusion of knowledge, it is
suggested that revisions in the legislation, homogeneous international regulation and supervision of health authorities
ensure quality of product and control of pharmaceutical marketing. This work also addresses political and social con-
siderations on the subject while exploring some suggestions of ideal patent system.
Keywords: Management of Innovation; Intellectual Property; Patent; Pharmaceutical Industry
1. Introduction
In current information society, the management of inno-
vation is seen as a key factor to the survival of the or-
ganizations that function in high global competition and
fast technological advances. The market competition to-
day encompasses not only the excellence in the perfor-
mance or the technical efficiency, but also the capacity of
developing systematic processes through the production
and application of knowledge.
In the pharmaceutical field, in special, the companies
recognize that the available technologies and the pieces
of knowledge may come from the internal and external
organization limits. The absorptive capacity is funda-
mentally important for the creation of new medicines [1].
From this perspective, as much the internal actors as the
external can influence the investments of the company in
R & D, pushing the limits of the combination opportuni-
ties and competences previously disconnected.
To promote the continuous science progress, the gov-
ernments authorize, for a limited period of time, the ex-
clusive right for the creator in the form of patent con-
cession. However, on the one hand, there is the increase
of the pattern that the right of intellectual property
provides an incentive for the production of new knowl-
edge through heavy investments in R & D [2], on the
other hand, the legislation in force makes that the patent
expiration does not coincide necessarily with the loss of
market exclusivity [3]. Although it is necessary for any
company to recoup the costs of an innovation, it does not
happen only during the period of the patent effect. The
costs are often recovered after the patent expires if the
market strategies of the pharmaceutical industry are well
planned [4].
Also, the knowledge disseminated by the patent allows
the “invention around of” [5] or “invention among pat-
ents” [6], when the strategic benefit is not given to the
production of knowledge anymore, but to the adoption
and dissemination of the knowledge produced in other
companies. In this case, generic versions or incremental
innovations can be introduced in the Market by rival
companies, which undermines substantially the market
share of the medicine in the registered brand.
There are innumerous ways for the pharmaceutical
companies holders of patents to extend the market mo-
nopoly privileges besides the period determined by law
and processes that are usually called “evergreening” [7]
or “term of the patent restoration” [8]. The majority of

Strategy of Innovation’s Management in the Pharmaceutical Industry Holds Intellectual Property 566
these strategies are in compliance with the legislation rul-
ing, although sometimes they weaken the competitive-
ness of the market [7]. In order to prolong the profits, the
industry tries to extend the validity of the patent, tries to
guarantee new therapeutics indications for the product,
tries the medicine’s own drug and, finally, tries to in-
crease the portfolio of new products through the proc-
esses of merging and acquisition. Meanwhile, in an at-
tempt to obtain part of an extremely profitable market,
the rival companies launch innovations for the original
product, or try to anticipate the commercialization of
generics.
The current work has its goal to describe, through
examples, the diverse strategies used by the pharmaceu-
tical industry in the preservation of its legit rights and
from the imperatives of the intellectual property’s system.
This work is divided into three parts besides this intro-
ductory phase. The following describes the methodology
of the work and the development theoretical-documental
that contemplate the management model of innovation in
the pharmaceutical industry and the six strategies used on
the market protected by intellectual property’s rights.
The final part approaches the political and social consid-
erations of these strategies.
2. The Innovation’s Management in the
Pharmaceutical Industry
On the first half of the 19th century it was already no-
ticeable the commercialization of medicines in Europe
and in the New World. “This way, even before the
emergence of effective medicine, the pharmaceutical
business (…) didn’t market products, but promises of
cure. In another words, the pharmaceutical industry was
born before the medicines” [9] and since the beginning
was promis ing i nn ovat i ve solutions.
The global pharmaceutical industry appeared only
during the decades of 1940 and 1950 with the develop-
ment of a higher scale of new products. Despite the im-
portance of the innovation for the improvement in the
quality of life of a man and for the survival of the phar-
maceutical segments, launching a new chemic identity on
the market is a hard work, long and full of risks. The
development of a new drug takes approximately 11,5
years and consumes 800 million dollars until its approval
throughout all the clinical p hases [10]. Furthermore, only
one on each five thousand candidates for medicine make
it to the market and only one on each one thousand sur-
vives the clinical tests and generate the register of a pat-
ent. For the assurance of a patent, the government pro-
vides exclusive rights for the innovation’s owner during
a limited time of 20 years.
The concession of a new patent, however, makes pub-
lic the information about the invention, and these can be
shared by a big number of rival companies. That allow
the “invention around of” [5], or “invention among pat0
ents” [6] where the strategy advantage is not given to the
knowledge production anymore, but to the adoption and
dissemination of the knowledge produced in another
companies. The knowledge and competence dissemina-
tion can occur also on the researchers technical meetings,
chats between employees from rival companies, contrac-
tion new employees from competitor companies [11] by
the reverse engineering od products with the use of
technological platforms or by the analysis of the patents
data, scientific articles and the use of specific software
[12]. The systemic nature of the innovation process must
consider the interactions, cooperation, and exchange in-
volving producers, suppliers, and users of the technol-
ogy.
In addition to these incremental innovations, by the
end of the validity for exclusivity con ced ed by th e pa tent,
the rival companies can produce chemically identical
copies and bioequivalent to the original product, what is
called generic medicine. Either through incremental in-
novations or generic medicines, the introduction of simi-
lar products by rival companies erodes substantially the
original medicine’s market share. For this reason, the
pharmaceutical industry uses many regulatory ways to
extend the patent’s period of application, using legal
factors that vary from country to country.
In Brazil, the legislation about the expiration of the
patent period passed through changes after 1995, when
the country joined the World Trade Organization (WTO)
and signed the TRIP agreement. Today, the protection of
the medicine’s patent is guaranteed by a further maxi-
mum of 20 years since the register date in the country
where it was the first patent’s deposit. Once the deposit is
made in Brazil, eventual subsequent modifications in the
patent’s original country don’t apply in Brazilian terri-
tory. For this reason, the validity term of the patent in
Brazil is not the same as its correspondent abroad. Nev-
ertheless, in Brazil, Argentina, Canada, China, Colombia,
Ecuador, Hungary, India, Malaysia, Peru, South Africa,
and Venezuela, there isn’t a tool of extension for the term
of validity, as regulated by the American legislation [7].
Besides, due to the globalization, every country is af-
fected direct or indirectly by the economic and social
challenges facing other nations.
Currently, for the pharmaceutical industry as important
as a new medicine is the innovation’s management and
the right of Intellectual Property (IP) of the products in
place. These practices of management are known as the
drugs cycle of life management [10], “evergreening” [7]
or “term of patent’s restoration” [8]. Within this process,
after the achievement of a patent, a consecutive number
of patents for new combinations, use, formulations, and
processes of production or molecules are also requested
to the regulatory body.

Strategy of Innovation’s Management in the Pharmaceutical Industry Holds Intellectual Property 567
3. Methodological Procedures
This study is a research of historical nature, descriptive
and documental that used books, periodic, and websites
from regulatory entities of intellectual property from
many countries. The research problem was approached in
a qualitative way justified by the nature of the study ob-
ject as well as the procedure used for the data collection.
The strategy of both pharmaceutical companies involved
with the system of intellectual pro perty were classified in
proportion to the risk for the development of a medicine
[13], as detailed in Figure 1 and explained on the next
section.
4. Data’s Analysis and Description
After the Following, the inn ovation’s management in the
pharmaceutical industry is exemplified and described.
This is a study theme of big importance once the legisla-
tion needs to be constan tly reviewed in order to keep the
fragile balance between the legit rights and the impera-
tives of the intellectual’s property system [7].
4.1. Delay or Limit the Generic Competition
Generic medicines are bioequivalent to the brand prod-
ucts, in other words, they are chemically identical and
generate the same therapeutics actio n. The generic medi-
cines are available by the competition only after they
receive the approval of bioequivalence by the competent
organ and the expiration of the original patent. They re-
late to the low risk of development of pharmaceutical
products (Figure 1). Delaying the introduction of a ge-
Incremental
Innovation
New
Chemical
Entity
Current
Situation Supergeneric
Evergreen
Supergenérico
Low
Low
High
High
Mechanism/Activity
Chemical Structure
Risck
Generic
F&A
Figure 1. Development of a medicine on the basis of risk.
Source: adapted from Grau and Serbedzjia [13].
neric product in one day could mean millions of dollars
in profits for a pharmaceutical brand monopoly holder.
On average, a patent-off generates a loss of US$2.6 mil-
lion a day [14]. This way, the main strategic approach of
the patent holders companies includes practices to delay
or limit the generics competition in a specific market.
The generics industry, on the other hand, seeks defi-
ciency on medicine patents of brand such as mistakes,
false statements, omissions or inconsistency, in order to
truncate the life of the patent and anticipate the access to
a potential profit market.
The delay of the generics entrance on the market after
the patent expiration can occur for many reasons. First of
all, there is a necessary time for the medicine to get an
approval from the regulating organ. Second, the entrance
of generics can be staggered due to the uncertainly
around the market opportunities, the real time of the pat-
ent validity [4,8 ,14,15] and the reaction of the marketing
from the patent holder company, mainly through the re-
duction of price of the original brands [4,16]. The delay
in the diffusion of generics can also occur because many
buyers remain reluctant to adopt a new product until
there is enough evidence about the security and quality
for the exchange [7,15,16]. Although less frequent, this
strategy of defamation is still explored in markets sensi-
tive to the perceived quality [3 ,16].
In 2011, in Brazil, according to the National Health
Surveillance Agency, before the expiration of the Via-
gra’s patent there were already five register registration
requests to produce generic medication. By the end of
2013, the pharmaceutical industry of generics will be
able to launch products that treat cancer (everolimus,
rituximab, imatinibe, capecitabina), migraine (almotrip-
tano), psychological distress (ziprasidona), malaria (ato-
vaquona), ulvers (famotidine, aprepitante) and trans-
plants (sirolimus).
4.2. Preventive Launching of a Generic
The model of business of the multinational pharmaceuti-
cal companies is highly dependent of the protection of
the patent and the rigidity of the rights of intellectual
protection. The big pharmaceutical companies are con-
stantly treated by the entrance of generic versions of their
medicines, making the price of the product increase one
fifth of the original price [7]. In order to fight th e loss of
receipts, a pharmaceutical company tries to prolong the
cycle of life of its drug as much as possible. An alterna-
tive is the introduction of its own generic, what is called
“authorized generic” [14]. The authorized generic is
launched in the same they as the first competitor generic.
The titular plan of the patent is to change its profits of
short term to net gain in long term.
The rational basis for the authorized generic strategy is
illustrated on Figure 2. The area OABD represents the

Strategy of Innovation’s Management in the Pharmaceutical Industry Holds Intellectual Property 568
A
O DY
XC
B
W
Z
Drug obsolence
Patent expiration
Typical generic introdu ction
Patent pre-expiration
Generic introduction
Profits
TIME
Figure 2. Evaluation of merits relating to the generic introduction. Source: Pearce [14].
profit obtained by the brand company during the period
of protection of the patent. When the patent expires, the
profits drop drastically until reduced to zero (DCZ).
However, if the company plans on introducing a new
generic of its medicine before the patent expiration (time
Y, point X), the profits of the company on long term will
be represented as area OAWXZ. This way, if the receipts
with the protected patent of YWBD are estimated to be
lower than the receipts of generic YXZ, the company of
brand will introduce a generic form of the drug. The
strategy of generic substitution allows the patent holder
to increase the total profits and to dissuade the generic
manufactures to join a specific market [14].
It’s worth highlighting that the fabrication and disclo-
sure of the authorized generic can be done by the original
patent holder company or by an outsourced organization
[4]. The patent holder company preserves its market
power for the high margin medicines and avoids the du-
plication of costs, especially those associated with the
manufacturing, marketing and distribution of a generic
brand. The generic manufacturers, on the other hand re-
duce the excess of productive capacity when commer-
cializing a medicine that holds pharmaceutical market
guarant eed [1 4].
In order to fight this competition in the Brazilian mar-
ket, in April of 2010, Pfizer set an agreement with the
national Eurofarma [17]. Also in 2010, Pfizer bought
40% of the national laboratory Teuto, with the possibility
to acquire the full control of the company starting in
2014. Since September from 2010, Teuto started com-
mercializing generic versions of Viagra® and Lipitor®
[18]. Besides Pfizer, the French laboratory Sanofi-Aventis
also entered in the generic market for the acquisition of
the national company Medley, process that happened in
2010 [19].
4.3. Supergenerics Strategy
In the decade of 2000, some scientific works started to
report a strategic change in the pharmaceutical industry
related to the “barrier for generic products”. Against to
the commodities generics, which are copies of the origi-
nal drugs, the new strategy covers the production of su-
pergenerics. These are different from the original product
relating to the formula or to the method of administration
and, many times, related to the effectiveness.
The supergenerics offer a price alternative of high
value for the generics because the products are eligible
for the protection of the patent and three years of exclu-
sivity of the market in the United States [20]. As such,
the supergenetics represent better therapeutics entities of
fast development, less risks (Figure 1) and, mainly, prof-
itable for the pharmaceutical companies [21,22].
Examples of supergenetics involve inhaled versions of
capreomicina to treat tuberculosis [22]; nifedipina with
slow liberation that reduces the side effects of dizziness,
flushing, headache, and edema; fluvastatina that reduces
the risk of myopathy and predinisona modified, that re-
duces the morning stiffness for patients with rheumatoid
arthritis [21]. The performed in an generic to make it a
supergeneric can also be performed in original drugs in
order to increase the cycle of useful life, strategies really
used by the pharmaceutical industry holder of intellectual
property, as described below.
4.4. Stratification of Innovation
The pharmaceutical companies perform the stratification
of their innovations to guarantee a new patenting from a
basis product [8,7,14,23]. The goal is submit many pat-
ents for the new drug with the purpose of extend its
market monopoly and to protect it in many ways against
the production of generic medicines. This process is
called stockpiling, in another words, the companies store
protection for their prod ucts when patenting many attrib-
utes of a single innovation and obtain the extension of
the exclusivity term for each new patent submitted [7,8,
23].

Strategy of Innovation’s Management in the Pharmaceutical Industry Holds Intellectual Property 569
Through this strategy, the patent holders companies
also take advantage of the consumer confidence on the
original product brand to “patent a patent” and to con-
tinue the innovations [24]. This way, before the original
product’s patent expire, the company presents a version
supposedly better of the medicine in order to generate a
patients commutation. When most of the consumers have
already replaced on product by other, the entrance of
generic medicines doesn’t generate meaningful loss of
market [7,14,23,25].
Many innovations of successor drugs are, in practice,
more superficial than the radicals [25]. They depend
more on detail accumulation than big technological find-
ings and offer low or none advantage about the original
medicine. In a general way, it could be aid that a new life
cycle of the product can be initiated by the development
of a new therapeutics indication, through the administra-
tion or use conditions [4]. Other possible types of secon-
dary patents are: 1) composition patents, 2) patents of
new polymorphs, 3) patents of new formulas, 4) patents
of synthesis, 5) patents for new therapeutics regimen, 6
patents of metabolites or pro-drugs and 7) patents for
stereoisomers [7,8].
Examples of the use of stereoisomers for new patent-
ing are the amoxicillin in 1980 (antibacterial drug), iso-
flurane and desflurane in 1992 (inhaled anesthetics), ibu-
profen in 1976 (no n-steroidal anti-inflammatory), fluoxe-
tine in 1997 (anti-depressive), and omeprazole in 1998
(against hearthburn) [26-28]. An example of the “me-
tabolite defense” evolves omeprazole in the decade of
1990. A generic version of Prilosec® (omeprazol, medi-
cine for heartburn) was only provided on the market in
2002 despite the expiration of the primary patent antici-
pated for 200 1 [25].
In relation to the patents for new therapeutics regimes,
it could be mentioned sildenafil (Viagra®), approved by
FDA in July 3rd, 2005 for the adjunct treatment of pul-
monary hypertension [29]. Pfizer Laboratory continues
with diverse studies using the active principle of silde-
nafil, it can be to achieve a new therap eutics indication or
to an approval of a new pharmacological presentation.
Extending the expiration date of a patent through the
stratification of the innovation, the innovator company
blocks the introduction of generic medicines and extends
its exclusivity and profits in the pharmaceutical market
[7,8,23].
4.5. Incremental Innovation
In a world where innovations are duplicated quickly, the
patenting process is a relatively effective answer to the
vulnerability inherent to the product information. The
patent doesn’t guarantee full protection to the innovation
because itself already reveals the information that, on the
other hand, could be protected by a con fidentiality agree-
ment. In this contest, the rival companies can use the
successor drug strategy to create their own version of
innovation, and to enter a new market demonstrably pro-
fitable and expandable. Besides this, the companies pro-
ducing incremental findings use the advantage of lower
costs and risks in relation to the original research [10].
The most known Family of incremental innovations is
estantinas, medicines used to reduce the cholesterol level
[25]. Estatinas are used to prevent ischemic heart dis-
eases and brain vascular diseases, and they are response-
ble for the biggest pharmaceutical market in history [1].
The development of estatinas started in 1973 and th e first
product of this class was launched on the market in 1987
by the name of Mevacor® (lovastatine) by Merck Sharp
& Dohme. In 1991 Pravacol® (pravastatine) by Bristol-
Myers Squibb and Zocor® (sinvastatina) by Merk arrived.
In 1991, Lípitor® (atorvastatina) by Pfizer was launched
and in 2000 Crestor® (rosuvastatina) by AstraZeneca [1].
Currently all estatatinas are already offered as a generic
medicine. With the present patent there is only a new
class of medicine that has a centered action in the bowel,
exetimibe.
Other pharmaceutical Market that should be pointed
out in relation to the incremental innovation is the seg-
ment related to the male sexual impotence. In the d ecade
of 1990 researches of Pfizer Laboratory showed that the
inhibition of the phosphodiesterase enzyme 5 (PDE-5)
increased the volume of blood in the penis. Until now,
besides Viagra®, three other inhibiting substances of
PDE-5 received the approval of FDA for the male sexual
impotence, Levitra® (vardanafil) by Bayer and Cialis®
(tadalafil) by Eli Lilly in 2003 and Stendra ® (avanafil) by
Vivus Laboratory in 2012. Recently, though still without
international expression and without license by FDA, it
was launched three other incremental innovation s for the
erectile dysfunction: Zydena® (udenafil) by Dong A
Farmacêutica Co. Ltda approved in Corea and in the
Russian Federation [30], Helleva® (lodenafil) by Cristália
Laboratory, approv ed in Brazil in October of 2007 and o
Mvix® (mirodenafil) recently licensed in South Korea
[30]. Among the diverse PDE-5 inhibitors, the scientific
works published until now don’t support differences in
the effectiveness profile and security between the prod-
ucts. The incremental innovation must prove superiority
to the original model or the pharmaceutical company
must invest big resources in marketing so the product be-
came commercially well succeed.
4.6. Merges and Acquisitions between
Pharmaceutical Companies
The pharmaceutical industry has been becoming ex-
tremely concentrated on the past 15 years due to the high
taxes of merges and acquisitions (R & D) from the past
two decades. Many of the big pharmaceutical companies

Strategy of Innovation’s Management in the Pharmaceutical Industry Holds Intellectual Property 570
are today the result of some big merges, including the
transnationals processes. Many scientific words demon-
strate the existence of mergers waves on the pharmaceu-
tical sector, but there isn’t a consensus about the deter-
minants of the process. In the neoclassic explanation, the
merges waves happen as an answer to regulatory, eco-
nomics or technological industrial shocks that require
relocation of capital assets on a large scale. In general,
the reasons usually used are: the existence of scale
economy in R & D, sales, and marketing, reach of global
competitiveness, pipeline and products enrichment ac-
quisition of new technologies and expansion of corpora-
tive control [31].
In the 21st century, in special, the mergers and acquisi-
tions were intensified due to the scarcity of pipeline,
creation stagnation of new drugs and patent expiration of
high sales products [32]. According to IBM Business
Consulting Service [33], between 2002 and 2007, the
patents of 35 blockbusters expired generating a billing
loss of US$73 billion for the pharmaceutical companies
and the loss of more than 200 .000 job s in the pa st 5 years
[32]. On this occasion, Pfizer became the biggest phar-
maceutical company in the world by using a notable se-
quence of acquisitions. These results, however, didn’t
show strength, instead, they are deriving from a threat:
the patent expiration of some medicines of high sales,
such as Lipitor® and Viagra® [34]. Using this same strat-
egy, in 2009, Pfizer bought Wyeth and created a new
structure of 71 billion dollars on annual sales and the
reduction of operational costs of 4 billion dollars [34].
Besides Pfizer, other big companies of the pharmaceu-
tical sector such as GlaxoSmithKline, AstraZeneca, San-
ofi-Aventis and MSD are result of the union of compa-
nies that kept their last names in the same time as they
add others.
5. Final Considerations
In the management of innovations, the rights of intellec-
tual property assume a primary role. The intellectual
property is based on the idea that the exclusivity of mar-
ket is necessary to create motivation to the innovation,
but the expiration of the patent, and specially the compe-
tition created by it, is also necessary to guarantee the
diffusion of innovations and their social benefits [2,3,35].
There were big changes in the patents system during the
past two decades, and the majority of them on the same
direction: the expansion and the reinforcement of the in-
vention’s protection. In the same way, recent tendencies
in the system of patents indicate a weakness in pat-
entability requirements [35].
Medicines aren’t any commodities, but an element
necessity to keep the health of the population. At this
point the conflict of interest starts, sin ce there is the right
of the pharmaceutical industry in obtaining benefits that
incentive the investments in research, while on the other
hand there is the right of health, on which all human be-
ings should enjoy. Questions about the cost of research,
price practiced by the pharmaceutical companies and
ideal level of protection of the patent system are in the
forefront of ongoing politic debates. In every case, the
central question spines around of the achievement of
appropriate balance between the IP and the access of
health treatment.
In order to benefit this delicate balance, the innovator
companies use many strategies to protect and apply their
rights of intellectual property. The preference for the
generic product launching by the patent holder shows
particular promise, since it guarantees a considerable flux
of income, keeping the costs of production low, and dis-
suade the generic companies to enter market. The strati-
fication of the innovations generally involves low risks
of failure of the product and the rejection of the market.
However, it’s also used to bring less financial return it
it’s not made a good marketing with the doctor’s class.
This strategy is advisable when the market niches iden-
tify themselves with the adapted version of the product,
or when the number of clients is enough in size and fi-
nancial capacity, to support the additional costs. The
mergers and acquisitions can generate scale economy,
global competitiveness reach, enrichment of pipeline,
acquisition of new technologies and expansion of corpo-
rative control, although can also generate the destruction
of values for the shareholders and overestimation of effi-
ciency gains. Generics, in turn, represent the new phar-
maceutical market reality. With the decline of efficiency
of R & D activities in the past 15 years, the models of
traditional business are giving place to the management
of the life cycle. Besides every strategy used by the
companies to prolong the validity of their patents, the
generics will occupy the high profitable pharmaceutical
market of blockbusters. However, even the generic com-
panies need to worry about future profits. Soon, many
products will be supplied as generics, what will generate
competition in prices and lower return abou t inve stments.
On this situation, the supergenerics can represent an al-
ternative strategy. These strategies are summarized in
Table 1.
The majority of the strategies used by the patent holder
companies are clearly in conflict with the purpose of the
intellectual property system, which isn’t to protect the
inventor, but to promote the development through crea-
tivity. These strategies eliminate the noble intention of
the patent law when using the existent gaps in the regula-
tion. These practices, although according to the law, are
anti-competitive and against the interest of the consu mer.
The pharmaceutical industry is aware of its importance
as a strategic sector in the national economy, that’s why
it puts strong political and economic pressure in the

Strategy of Innovation’s Management in the Pharmaceutical Industry Holds Intellectual Property 571
Table 1. Strategy of Inovation.
Strategy Feature
Delay or limit the generic
competition Markets sensitive to perceived quality.
Preventive launching of a
generic Change its profits of short term to net gain in long term.
Supergenerics Strategy Offer a price alternative of high value
for the generics because the products
are eligible for the protection of the
patent and three years of exclusivity of
the market in the United States [20].
Stratification of
innovation Guarantee a new patenting from a basis product [7,8,14,23].
Incremental Innovation The rival companies can use the suc-
cessor drug strategy to create their
own version of innovation, and to
enter a new market demonstrably
profitable and expandable.
Merges and acquisitions
between pharmaceutical
companies
The existence of scale economy in R
& D, sales, and marketing, reach of
global competitiveness, pipeline and
products enrichment acquisition of
new technologies and expansion of
corporative control [31].
management of its own interests. To combat the anti-
competitive strategy diffusion used by the pharmaceuti-
cal industry, constant reviews of the existing regula-
tions are necessary in order to verify the failures that
could be explored. The legal system should also be aware
of these strategies so the courts can be faster on their
decisions to avoid the extension of the patent’s validity
only because of the delays in justice [7].
The health authorities could guarantee the security
about the therapeutics equivalence between brand prod-
ucts and generics and, in the same time, reduce the per-
suasive advertisements of the brand medicines, not
through bureaucratic imposition, but limiting the ex-
penses of the companies with pharmaceutical marketing.
Finally, there is also the necessity of international ho-
mogeneous regulation about the intellectual property
right, mainly due to the market globalization. The dis-
crepancy of regulation among the countries creates dis-
parity of treatment among inventors of different regions
and complicates the work of examiners, what leaves open
space for the dispute.
Therefore, to become a political instrument that aim
encourage the innovation and diffusion of knowledge,
the patents should maybe present a menu of different
degrees of protection [35], with the selected evaluation
and compensation due to the inventive value and to the
effort destined to the R & D pro cess. The pa tenting crite-
rion, as novelty and not obviousness, should be strict
enough to avoid the concession of patents for the inven-
tions with low social value, which only increase the sys-
tem’s costs. At the same time, the protection force of the
intellectual property system should provide enough in-
centives for the unique development of high social value
inventions.
Even though this theme was already explored in an-
other scientific works, it treats about a complex subject
that requires new investigations, mainly because the pat-
ent system does not represent an incentive for all kinds of
inventions, as well as the great level of patent protection
may differ between the different technological fields [35].
Finally so the system of ideal system became true, the
legislation needs to be constantly reviewed to keep the
fragile balance between legit rights and the imperatives
of the intellectual property [7]. To build a fair society,
it’s urgent a new innovation order in the health manage-
ment, based in the rupture of ruling systems and with
new and real opportunities of economic growth.
6. Conclusion
In the academic literature there are many examples of
strategies used by the pharmaceutical industry in the
postponement of its patents, but many of the research
questions aren’t answered yet. The realization of other
studies may contribute to the validation of the necessity
of improvement of technical guidelines of the patents and,
consequently, of the innovations management.
REFERENCES
[1] Y. Baba and J. Walsh “Embeddedness, Social Episte-
mology and Breakthrough Innovation: The Case of the
Development of Stations,” Research Policy, Vol. 39, No.
4, 2010, pp. 511-522.
http://dx.doi.org/10.1016/j.respol.2010.01.016
[2] G. Dosi, L. Marengo and C. Pasquali, “Ho w Much Should
Society Fuel the Greed of Innovators? On the Relations
between Appropriability, Opportunities and Rates of In-
novation,” Re search Policy, Vol. 35, No. 8, 2006, pp. 1110-
1121. http://dx.doi.org/10.1016/j.respol.2006.09.003
[3] G. Duflos and F. R. Lichtenberg, “Does Competition
Stimulate Drug Utilization? The Impact of Changes in
Market Structure on US Drug Prices, Marketing and
Utilization,” International Review of Law and Economics,
Vol. 32, No. 1, 2012, pp. 95-109.
http://dx.doi.org/10.1016/j.irle.2011.08.003
[4] M. Agrawal and N. Thankkar, “Surviving Patent Ex-
piration: Strategies for Marketing Pharmaceutical Prod-
ucts,” Journal of Product & Brand Management, Vol. 6,
No. 5, 1997, pp. 305-314.
http://dx.doi.org/10.1108/10610429710179471
[5] S. G. Winter. “Conhecimento e Competência Como Ati-
vos Estratégicos,” In: D. A. Klein, Ed., A Gestão Estraté-
gica do Capital Intellectual, Qualitymark Editora, Rio de
Janeiro, 1998, pp. 251-286.
[6] F. R. Lichtenberg and T. J. PhilipsoNo. “The Dual Effects
of Intellectual Property Regulations: Within- and Be-
tween- Patent Competition in the US Pharmaceuticals
Industry,” NBER Working Paper Series, 2002.
http://www.nber.org/papers
[7] G. Dwivedi, S. Hallihosur and L. RangaNo, “Evergreen-
ing: A Deceptive Device in Patent Rights,” Technology in

Strategy of Innovation’s Management in the Pharmaceutical Industry Holds Intellectual Property 572
Society, Vol. 32, No. 4, 2010, pp. 324-330.
http://dx.doi.org/10.1016/j.techsoc.2010.10.009
[8] D. S. Fernandez and J. T. Huie, “Balancing US Patent and
FDA Approval Processes: Strategically Optimizing Mar-
ket Exclusivity,” Drug Discovery Today, Vol. 9, No. 12,
2004, pp. 509-512.
[9] J. C. Gerez, “Indústria Farmacêutica: Histórico, Mercado
e Competição,” Ciência Hoje, Vol. 15, No. 89, 1993. pp.
21-30.
[10] C. Sternitzke, “Knowledge Sources, Patent Protection,
and Commercialization of Pharmaceutical Innovations,”
Research Policy, Vol. 39, No. 6, 2010, pp. 810-821.
http://dx.doi.org/10.1016/j.respol.2010.03.001
[11] D. M. Carolis, “Competencies and Imitability in the
Pharmaceutical Industry: An Analysis of Their Relation-
ship with Firm Performance,” Journal of Management,
Vol. 29, No. 1, 2003 pp. 27-50.
http://dx.doi.org/10.1177/014920630302900103
[12] S. Gupta, “Diffusing Knowledge-Based Core Competen-
cies for Leveraging Innovation Strategies: Modeling
Outsourcing to Knowledge Process Organization (KPOs)
in Pharmaceutical Networks,” Industrial Marketing Man-
agement, Vol. 38, No. 2, 2009, pp. 219-227.
http://dx.doi.org/10.1016/j.indmarmaNo.2008.12.010
[13] D. Grau and G. Serbedzjia, “Innovative Strategies for
Drug Repurposing,” Drug Discovery & Development, 2007.
http://www.dddmag.com/articles/2007/09/innovative-strat
egies-drug-repurposing.
[14] J. A. Pearce, “How Companies Can Preserve Market
Dominance after Patents Expire,” Long Range Planning,
Vol. 39, No. 1, 2006, pp. 71-87.
http://dx.doi.org/10.1016/j.lrpp.2005.04.006
[15] A. T. Ching, “Consumer Learning and Heterogeneity:
Dynamics of Demand for Prescription Drugs after Patent
Expiration,” International Journal of Industrial Organi-
zation, Vol. 28, No. 6, 2010, pp. 619-638.
http://dx.doi.org/10.1016/j.ijindorg.2010.02.004
[16] J. Hudson, “Generic Take-Up in the Pharmaceutical
Market Following Patent Expiry: A Multi-Contry Study,”
International Review of Law and Economics, Vol. 20, No.
2, pp. 205-221, 2000.
http://dx.doi.org/10.1016/S0144-8188(00)00030-2
[17] A. Vieira, “Pfizer Fecha Parceria com a Eurofarma,”
Desenvolva, 2010.
http://www.treinamentosparafarmacia.com/2010/04.
[18] Valor Econômico, “Teuto Investe para Duplicar a Pro-
dução de genÉrico,” 2011.
http://www.dignow.org/post.
[19] M. Scaramuzzo, “Pfizer e Sanofi vão Exportar Genéricos
do Brasil para a AL,” Valor Econômico, 2012.
http://clippingmpp.planejamento.goVol.br/cadastros/notic
ias/2012/4/26/pfizer-e-sanofi-vao-exportar-genericos-do-
brasil-para-al.
[20] S. A. Charles, “Supergenerics: A Better Alternative for
Biogenerics,” Drug Discovery Today, Vol. 10, No. 8,
2005, pp. 533-535.
http://dx.doi.org/10.1016/S1359-6446(05)03410-0
[21] S. Stegemann, “Improved Therapeutic Entities Derived
from Known Generics as an Unexplored Source of Inno-
vative Drug Product,” European Journal of Pharmaceu-
tical Science, Vol. 44, No. 4, 2011, pp. 447-454.
http://dx.doi.org/10.1016/j.ejps.2011.09.012
[22] A. Schoubben, “Capreomicin Supergenerics for Pulmo-
nary Tuberculosis Treatment: Preparation in Vitro, and in
Vivo Characterizati on,” European Journal of Pharmaceu-
tics and Biopharmaceutics, Vol. 83, No. 3, 2013, pp.
388-395. http://dx.doi.org/10.1016/j.ejpb.2012.11.005
[23] D. I. Gorlin, “Staving off Death: A Case Study of the
Pharmaceutical Industry’s Strategies to Protect Block-
buster Franchise,” The Food and Drug Law Journal, Vol.
63, 2005, pp. 1-51.
[24] T. X. Witkowski, “Intellectual Property and Other Legal
Aspects of Drug Repurposing,” Drug Discovery Today:
Therapeutic Strategies, Vol. 8, No. 3-4, pp. 131-137.
http://dx.doi.org/10.1016/j.ddstr.2011.06.008
[25] M. Angell, “A Verdade Sobre os Laboratórios Far-
macêuticos: Como Somos Enganados e o que Podemos
Fazer a Respeito,” 3rd Edition, Editora Record, Rio de
Janeiro, 2008.
[26] I. Agranat and H. Caner, “Intellectual Property and
Chirality of Drugs,” Drug Discovery Today, Vol. 4, No. 7,
1999, pp. 313-321.
http://dx.doi.org/10.1016/S1359-6446(99)01363-X
[27] H. Caner, “Trends in the Development of Chiral Drugs,”
Drug Discovery Today, Vol. 9, No. 3, 2004, pp. 105-110.
http://dx.doi.org/10.1016/S1359-6446(03)02904-0
[28] I. Agranat and S. R. Wainschtein, “Th e Strategy of Enan-
tiomer Patents of Drugs,” Drug Discovery Today, Vol. 15,
No. 5-6, 2010, pp. 163-170.
http://dx.doi.org/10.1016/j.drudis.2010.01.007
[29] B. Cremers and M. Bohm. “Non Erectile Dysfunction
Application of Sildenafil,” Herz, Vol. 28, No. 4, 2003, pp.
325-333. http://dx.doi.org/10.1007/s00059-003-2473-0
[30] E. R. MacNamara and C. F. Donatucci, “Newer Phos-
phodiesterase Inhibitors: Comparison with Established
Agentes,” Urologic Clinics of North America, Vol. 38,
2011, pp. 155-163.
[31] S. Shibayama, “Effect of Mergers and Acquisitions on
Drug Discovery: Perspective from a Case Study of a Ja-
panese Pharmaceutical Company,” Drug Discovery To-
day, Vol. 13, No. 1-2, 2008, pp. 86-93.
http://dx.doi.org/10.1016/j.drudis.2007.10.015
[32] I. Khana, “Drug Discovery in Pharmaceutical Industry:
Productivity Challenges and Trends,” Drug Discovery
Today, Vol. 17, No. 19-20, 2012, pp. 1088-1102.
http://dx.doi.org/10.1016/j.drudis.2012.05.007
[33] IBM Business Consulting Service.
http://www-935.ibm.com.
[34] Revista Exame, “Setor Farmacêutico Mantém Ritmo de
Fusões e Aquisições,” 2010.
http://www.consultaremedios.com.br/noticia.php?
[35] D. Encaoua, D. Guellec and C. Martínez, “Patent Systems
for Encouraging Innovation: Lessons from Economic
Analysis,” Research Policy, Vol. 35, 2006, pp. 1423-1440.
http://dx.doi.org/10.1016/j.respol.2006.07.004