Taxonomy of Innovation: Learnings from Biocon

Biocon has a focused strategy for innovation in new drug discovery. Established in 1978, it has focused on
innovation in new drug discovery. Biocon has focused on innovation to develop cutting edge intellectual
property, which makes a biotech firm relevant in a dynamic and competitive scenario

Biocon’s strength lies in its Research & Development which are mainly in the areas of managing and curing
three diseases – a) Immunology, comprising of cancer and autoimmune diseases, b) diabetes and c)
cardiovascular and human growth hormones. Dr. Kiran Mazumdar Shaw, in her 2011 annual address
mentioned that Biocon’s patent portfolio stands at about 1075 applications; about 245 are granted patents.
These cover areas such as fermentation, protein purification, drug delivery systems and biotherapeutic
molecules.

Innovation in biotechnology demands a long development cycle – hence requires considerable patience and
the ability to tolerate risks of failure. However, the rewards can be greater – financially. For Biocon,
innovation means exploring both existing and non-existing expertise where either technology is known or
unknown. Creativity and R & D leadership are the instruments to achieve innovations in four modes
A] Incremental Innovation is meant for known and currently existing areas of competencies and aimed at
building and retaining market leadership in innovation. Biocon started as an enzymes company; it changed
its business model and aimed at incremental innovation in bio-pharmaceuticals area for existing products
such as insulin and processes. Innovation in a proprietary insulin process technology led to development of
a low cost insulin for patients suffering from diabetes

B] Evolutionary innovation is meant for known but non-existing areas of competencies and aimed at
expanding market leadership in innovation. Dr. Shaw discussed the attempts of Biocon in developing
Glargine and other insulin analogues for the treatment of diabetes. These innovations were carried out in
the known area of diabetes research with an aim to create new values and expand the diabetes business
Foundation for UNKNOWN Creating market
leadership leadership

Experimental Breakthrough
Innovation Innovation

EXISTS CREATIVITY DOES NOT

EXIST

Incremental Evolutionary
Innovation Innovation

Expanding market
Building market
leadership
leadership
KNOWN

C] Experimental Innovation is meant for unknown, yet currently existing areas of competencies and aimed
at creating foundation for leadership in innovation. Biocon has developed an oral insulin tablet to treat
diabetes which gives freedom from the use of pricking needles to inject insulin. To enable this, Biocon bought
the technology from a small company in USA.
D] Transformational (break-through) innovation is meant for unknown, currently non-existing areas of
competencies and aimed at creating market leadership in innovation. In this direction Biocon is investing in
research to prevent the onset of diabetes. The approach is to develop monoclonal antibodies with capability
to prevent the destruction of insulin producing beta cells in the pancreas. This may improve the auto-
immune system to manage diabetes.