| Author: | Loch, C. H. Bode-Greuel, K. |
| Title: | Evaluating growth options as sources of value for pharmaceutical research projects |
| Journal: | R. and D. Management
2001 : VOL. 31:2, p. 231-248 |
| Index terms: | EVALUATION GROWTH PHARMACEUTICAL INDUSTRY R&D |
| Language: | eng |
| Abstract: | Using decision trees, the authors demonstrate a quantitative evaluation of compound growth options from research at BestPharma, a large international pharmaceutical company. A growth option is a future opportunity that may arise from a current R&D investment. The growth option may not be related to the primary purpose of the R&D project, or not even be directly foreseeable. Kester (1984) has argued that growth options may account for a large part of project value. BestPharma faced the problem of choosing among several strategic research initiatives. They developed a decision tree representation of the projects, which helped to provide transparency about project value and strategic options. |
SCIMA