Contracts for biopharmaceutical manufacturing based on production cost and capabilities

buir.contributor.authorLimon, Yasemin
buir.contributor.orcidLimon, Yasemin|0000-0001-6126-4016
dc.citation.epage2662en_US
dc.citation.issueNumber7
dc.citation.spage2640
dc.citation.volumeNumber62
dc.contributor.authorLimon, Yasemin
dc.contributor.authorMartagan, T.
dc.contributor.authorKrishnamurthy, A.
dc.date.accessioned2024-03-13T06:26:18Z
dc.date.available2024-03-13T06:26:18Z
dc.date.issued2023-06-09
dc.departmentDepartment of Management
dc.description.abstracttrategic collaborations are critical to the success of efforts aimed at discovering new drugs and therapies in the biopharmaceutical industry. These collaborations aim to leverage domain expertise, asymmetries in production costs and/or capabilities to improve efficiency. Despite increasing collaborations, the biopharmaceutical industry lacks a structured guideline for choosing contracts. We present contract models with effort-based formulations that capture the key characteristics of biopharmaceutical operations and analyse incentive mechanisms such as fixed payment, revenue-sharing, risk-sharing, and cost-sharing in biopharmaceutical collaborations. We show that traditional incentive schemes do not achieve supply chain coordination, although they are commonly used in the industry. We introduce a new contract model called fee-for-effort-and-output contract that encourages the parties to exert higher efforts by offering discounts on their operating costs, and show that this contract achieves coordination with an appropriate selection of contract parameters. We also investigate the efficiency of noncoordinating contracts with traditional incentive schemes and identify the capability and cost structures under which they achieve the highest efficiency possible, to both determine the next-best alternatives and explain their popularity in practice.
dc.description.provenanceMade available in DSpace on 2024-03-13T06:26:18Z (GMT). No. of bitstreams: 1 Contracts_for_biopharmaceutical_manufacturing_based_on_production_cost_andcapabilities.pdf: 2752656 bytes, checksum: f3ce705534ee674d9710249152b0a19a (MD5) Previous issue date: 2023-06-09en
dc.identifier.doi10.1080/00207543.2023.2222011
dc.identifier.eissn1366-588X
dc.identifier.issn0020-7543
dc.identifier.urihttps://hdl.handle.net/11693/114644
dc.language.isoen
dc.publisherTaylor & Francis
dc.relation.isversionofhttps://doi.org/10.1080/00207543.2023.2222011
dc.source.titleInternational Journal of Production Research
dc.subjectSupply chain coordination
dc.subjectBiopharmaceutical industry
dc.subjectDrug development
dc.subjectMultidimensional output
dc.subjectAsymmetric capabilities
dc.titleContracts for biopharmaceutical manufacturing based on production cost and capabilities
dc.typeArticle

Files

Original bundle

Now showing 1 - 1 of 1
Loading...
Thumbnail Image
Name:
Contracts_for_biopharmaceutical_manufacturing_based_on_production_cost_andcapabilities.pdf
Size:
2.63 MB
Format:
Adobe Portable Document Format

License bundle

Now showing 1 - 1 of 1
No Thumbnail Available
Name:
license.txt
Size:
2.01 KB
Format:
Item-specific license agreed upon to submission
Description: