Value Creation through Orphan Innovations; A case study of AstraZeneca

Abstract

It can be assumed that within all industries, it does occasionally happen that innovations occur that are not in line with the company’s business strategy. This master thesis focuses on these innovations that throughout this paper are called Orphan Innovations, as they do not belong to the company’s core business. The concept of orphan innovations is examined through the lens of the pharmaceutical industry, and with focus on the pharmaceutical company AstraZeneca. To look into what possibilities that could exist related to orphan innovation, the existing management process as well as the potential business value of orphan innovations is examined. It can through this research be concluded that Orphan Innovations are present at AstraZeneca, and that there are four different ways for how orphan innovations could be managed at at the company; through a sale of the innovation, through realization through open innovation, through publication of research, or it is dismissed. Additionally, what happens with the orphan innovation depends heavily on local circumstances such as the individuals, hence the employees and the management attitude, but also on whether and how much data that is accessible. It can further be concluded that both tangible and intangible business value can be extracted through orphan innovations. These values are capital, increased employee motivation, improved reputation, as well as access to new knowledge.