Myth of market needs and technology seeds as a source of product innovation — an analysis of pharmaceutical new product development in an anti-hypertensive product innovation

Abstract

We generally believe that product innovation frequently occurs by a strong actor who knows the market and technology. For this reason, the market leader has a stronger position to make an innovative product because of its marketing and technological competence to know market needs and technology seeds. This paper studies what kind of product inhibits product innovation. For this purpose, very recent pharmaceutical product changes are studied. In pharmaceutical products, we have selected an anti-hypertensive product to focus on the mature stage of market needs and technology seeds for product innovation. In this mature stage, all the companies recognize the research target for the existing innovative product since market needs and technology seeds are commonly shared among all firms. By analyzing the characteristics of the behavior of the pharmaceutical companies for product change in an anti-hypertensive market, it is demonstrated how strongly an existing product inhibits product change when a new product has a differentiated point and will create a new market. In conclusion, product innovation to create a new market by differentiation is inhibited by strongly existing products and the market knowledge that is acquired to gain or accumulate the expertise through marketing the existing product. We have shown the existence of a paradox between product strength in a market and product innovation by new technology.