The commercialisation of bioinformatics and the threat of open-source software

Abstract

This study investigates the commercialisation process of a select group of bioinformatics companies and the impact of open-source software. Using the research–development–application translation model provides a framework for managers as an iterative mechanism. A Value Creation Pipeline is then introduced with five phases of the commercialisation process that provide specific financial benchmarks that can guide the firm through to successful commercialisation. Using trend and financial ratio analyses relative to returns, profitability and liquidity, the study finds that the surge in open-source licenses between 2003 and 2005 limited the sales for some firms. As for the claim that open-source software negatively impacts the success of bioinformatics commercialisation, there was little evidence to suggest a direct cause-and-effect relationship. Losses in returns, profitability and liquidity were just as common before the rise of open source as after its emergence. When firms report an overall record over a nine-year period of poor return on investment, assets and equity, there is little to attract potential investors. The lesson that can be drawn is that the innovation process and financial tracking must be integrated to ensure efficient and profitable use of investor funds.