Henry Chesbrough

Open innovation, a strategy popularized by Henry Chesbrough, has taken the business world by storm. In his 2003 breakout book, Chesbrough argued — based largely on observations of the computer industry — that companies need to look beyond their walls to thrive. Gone are the days when in-house research and development (R&D) muscle alone could dominate markets . The future's giants will get the best bang for their research buck by bringing external ideas in and by letting internal ideas out. For drug discoverers, who have been battered by poor R&D returns, the promise of open innovation is appealing, even if differences between the biopharma and computer industries pose challenges. Drug companies, as a result, are increasingly talking the talk of open innovation and experimenting with academic collaborations, licensing deals, spin-outs and acquisitions. Chesbrough, a professor at the University of California in Berkeley, tells Asher Mullard about the trends and limitations of open innovation in life sciences.