After 30 years since the introduction of the concept of innovation in Japan, we are now talking about "open innovation", a step to stimulate innovation in the society as a whole by disclosing corporate innovation processes. It is, however, still questionable to what extent private enterprises in Japan can disclose their knowledge beyond the limit for their own profits. Experiences in the recent 20 years in which the Japanese industries reached an international level seem insufficient for them to free themselves from the habit acquired in the postwar years in which a number of companies had been competing in single industrial branches. While enterprises, particularly those in the electric/electronic field, which had acquired the foremost position in technology in this country through public purchase by the then national or semi-national communication, railway and electricity sectors until about 20 years ago, had to face a drastic change of competition conditions brought about by the internationalization of the procurement process, the "introvert mentality" of people in the business world remains obstinate. For example, the chemical industry, which has never enjoyed the benefit of public purchase, has just begun showing its originality, and not yet ready to step into open innovation. It is expected that quest for uniqueness of individual enterprises through the "selection and concentration" strategy will prompt the openness of innovation processes.

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An introductory and short explanation is summarized here for following five papers from the U.S.A., Germany, India, China, and Japan. Main topics include the reason of attention to biopharmaceutical industry, the global trend of commercialization of life science, the characteristics of advanced countries as the U.S.A. and Europe and of emerging countries as India and China, and Japan's trend of number of biotech start-ups, business areas, and venture capital.

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This paper summarizes thirty-five years of experience managing research--the practical aspects, as well as advanced decision-making methods for managing large research projects. Practical aspects are common sense. Hire and provide incentives and the right working environment for the best minds. However, the decision-making method introduced here is new. Called real options, it is a method superior to discounted cash flows because it accounts for the ability of a manager to make decisions that are contingent on the arrival of information at a future point in time. The value of abandonment and expansion are discussed with a numerical example.

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Prior research has devoted much effort to examine the role of environmental factors during the early phase of entrepreneurship. However, there is little research on the influences of certain factors on entrepreneurship during the development of an industry sector. Therefore, the aim of this article is to explore entrepreneurship in biotechnology from a more evolutionary perspective. In doing so, the focus is on two important environmental factors, public and private funding, since financing issues are critical for entrepreneurial development. Basically, this exploratory study shows that public and private funding have an important influence on entrepreneurship not only at its emergence but also to the point of its maturation. In addition, it provides preliminary support that public funding have an important impact in the early phase of the industry but play a minor role during the maturation phase. If confirmed by a larger study, our observations have considerable implications for researchers as well as for policy makers.

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Emerging industries such as biotechnology can be growth engines and promised to transform the troubled healthcare. Even after three decades, vast gap between the promise of biotech and reality, hint at some structural challenges. The industry faces dilemma on organizational, knowledge and strategy fronts as reflected in its financial performance. An attempt is being made in this exploratory paper to evolve the context of cooperative strategies for innovation taking case of biopharmaceutical firms. We explore if the inter-firm cooperative strategies in large capable countries such as India and Japan can be evolved for innovation to address the dilemma. For the purpose, a framework of metanational approach was selected to address issue of domestic or international cooperation.

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This paper analyzes the development of China's biotechnology industry from the perspective of sectoral innovation system. The elements, which include institutions, demand, technology, industry structure, finance and firms, are discussed in detail. The finding is that the interactions, learning, and capability building are not strong in China's biotechnology industry: (1) the separation of public inputs and firms' development; (2) the separation of large firms and SMEs; (3) the challenge of globalization of biotechnology industry. This paper contributes more in the problem findings than in the solution for this industry.

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About a quarter of recent new approved medicines are biopharmaceuticals. The increase of this ratio is expected in the future. Large pharmaceutical companies are making more R & D resources concentrate on clinical development rather than basic research, while the weight of basic research investment to life science is very high by the governments of Japan, the U.S.A., and Western Europe. In the meantime, the drug-discovery biotech start-ups are expected to fill this gap by more rapid commercialization than large pharmaceutical companies. But start-ups' bankruptcy rates are very high from resources limitation. Why, as first of research questions, can there be a lot of deficit biotech start-ups in biotech clusters as San Francisco bay area, even if the basic premise is the scrap and build? Why is it basically possible to repeatedly invest the irreversible and huge amount of sunk cost and time in the long term and high risky projects? Otherwise, why is there relatively a less number of biotech start-ups in Japan than in the U.S.A. where a more large number of companies are continuously founded, even the majority are deficits? In addition, can Japan transplant it into the country, if the U.S.A. model of biotech start-up has an economic rationality for a breakthrough? As a methodology, the timing option is focused on as an option to defer investing until the uncertainty declines, among the real options expected for its evaluation function on the economic validity of an innovative, promising, but high risky project. Thus, in this article, we examine the relationship between the symbiotic modeling of biotech start-ups and the useful possibility of real options, the application of real options to a process as the proof of concept, a basic model of the timing option enabling intermittent investment decisions to new projects, and the characteristics and functions of each model under the deterministic and stochastic models of underlying assets. In particular, the optimal timing was forecasted by simulation, when the behavior of the underlying assets was modeled by the stochastic theory.

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The one of most important policy in Japan is to develop the regional innovation system. So not only government, but also local authorities have conducted many policy measures. But these policies have no posture of endogenous development to urge initiatives such as the small and medium-sized enterprises peculiar to the region because of the centralization intention and the administrative initiation. On the other hand, there are many traditional craft industries based on various characteristics and a long history in our country, and some advanced science and technology have been developed from the traditional craft industry. In this article, we analyzed good practices of the cooperation between the traditional craft industry and academia in Kyoto and Ishikawa region. As a result, we introduce new concept of the industry-academia-government cooperation with traditional craft industry and propose some measures for local revitalization and regional innovation.

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It is supposed that large deregulation to be changed of a market rule has an influence on R & D activity of a company, but there are few studies that described the relations. In this research, concerning with energy sector firms, influences of the deregulation on the R & D activities of the electricity/gas companies will be analyzed. The structure change of the R & D activity is formulated by the "routine" of the company. If the R & D activity is based on the Markov process, the routine of the company is quantified by a transition probability matrix, and the change of the routine can be visualized by a limit probability distribution. The change of the R & D routine is compared between before and after the deregulation, also between the electricity and gas companies, with using the method of the Markov process applied to the R & D expenses and the patent number which seemed to be a substitute variable of the R & D activities in those companies. The analysis said that, after the deregulation, although a tendency to decrease was seen in the R & D expenses in both the electricity and gas companies, a decline tendency in the gas companies was more remarkable than the electricity companies concerning about the patent number. From analysis with the patent IPC, the electricity companies could be said to have the strategy of diversification with their technologies, on the other hand, the gas companies made their technologies intensive. Those results show the influence of deregulation was different between the R & D routine of the electricity and gas companies.

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