What Makes Novartis a Persistent Innovator?

Innovation Answered

How do big companies stay innovative across many decades, and in different industries? That’s been the driving question of our Persistent Innovators miniseries. In the fourth and final episode we turn to company in a very different kind of business: discovering and developing new drugs. And we focus on the global pharmaceutical giant Novartis, formed in 1996 from the merger of the venerable Swiss companies Sandoz and CIBA-Geigy. At its Novartis Institutes for BioMedical Research, opened in 2002, Novartis invented a new style of biology-centric drug discovery that has changed practices across the industry—and sparked a local biopharma boom that has utterly transformed the Kendall Square neighborhood of Cambridge.

Compared to the other industries we’ve covered in the miniseries, namely digital devices (Apple), entertainment (Disney), and toys (LEGO), the pharmaceutical business is downright cutthroat. Product development is risky, time-consuming, and expensive; competition is incredibly fierce; and even a blockbuster drug can become a flop once the patent expires and a generic drug makers jumps in. On top of all that, drug makers have to operate outside the traditional world of consumer marketing: You take a Novartis medicine not out of any brand loyalty to Novartis, but because your doctor tells you to.

The net effect is that to stay successful, a big drug company must keep their product pipelines full and churn out hit after hit—which, when you think about it, is the very definition of a persistent innovator. In this episode, former Novartis executive and drug hunter Tom Hughes explains how Novartis’s first CEO decided to rebuild the company’s drug discovery effort around a genomic and molecular understanding of disease. And current NIBR president Jay Bradner talks about the structures Novartis has set up to protect and promote high-output innovation. Finally, we speak with Sam Wiley, head of thought leadership and customer advocacy at PatSnap—our sponsor throughout the miniseries—about a few more companies he sees as persistent innovators.

Special thanks to our friends at PatSnap and Innovation Academy for sponsoring this miniseries.