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The Shape of Things to Come: A Global Perspective on Regional Innovation Indicators

In the pursuit to assess high-tech regions' performance in and capability for innovation and entrepreneurship, a bewildering variety of data is published, including:

  • employment
  • total corporate sales
  • wages
  • venture capital funding
  • new company formation and growth of small firms
  • R&D spending
  • patents, and many more

However, on the basis of such heterogeneous indicators, it can be difficult or even impossible to compare regions. Some of this is inevitable given different perceived data needs in each region. However, perhaps a common core of data might be supplied.

To this end, the Stanford Program on Regions of Innovation and Entrepreneurship is bringing together scholars and researchers from the United States, Europe and Asia to present data from their own regions that would help with comparisons between regions and linkages among them, and to make the case for what they consider the most useful set of indicators.

There will be four workshop sessions: the first will be devoted to discussing a framework for looking at entrepreneurship and innovation regional indicators, and the remaining three will take a regional focus, proposing indicators closely related to innovative regions in the United States, Europe and Asia.

This event is part of the "The Shape of Things to Come" conference at the Fisher Conference Center at Stanford University, January 17-18, 2007.

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Frances C. Arrillaga Alumni Center

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Early-Stage Valuation in the Biotechnology Industry

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Biotechnology (or biotech) has impacted almost every aspect of human life. It has reorganized industries, drastically changed healthcare, helped to improve the environment, and led to important changes in laws and ethical norms.

Among the various biotech fields, medical biotech has been by far the most influential, beneficial, and controversial. It has generated not only superlative discoveries to improve the lifespan and quality of human life, but also the greatest amount of wealth for all the players involved, and the greatest volume of public debate.

Several important trends are shaping the future of the pharmaceutical (or pharma) and biotech industries. The biotech industry is characterized by the presence of strong clusters in all countries. The pharma and biotech industries are experiencing an outsourcing phenomenon, mainly due to a lack of in-house expertise and efficiencies. Diagnostics and therapeutics are increasingly converging, a trend that will lead to predictive and precise diagnostics and personalized and preventive medicine. The first few years of the twenty-first century have witnessed significant changes in the pharma/biotech alliance landscape. Today we are seeing the “omic”-ization of the biotech industry: most of the emerging technologies are genomics, proteomics, cellomics, and pharmacogenomics. In addition, the biotech industry faces uphill ethical issues, including excessive marketing, third-world drug availability, genetic engineering, stem cells, and cloning.

The medical biotech industry faces several challenges. First, science, the human body, and disease are, essentially, complex. Second, unlike other high-technology industries, the biotech product development cycle is very long, even after proof of concept. Biotech projects take between ten and twenty years to become successful and cost over $200–300 million before a product reaches the market. Third, delivery of most biotech products and therapies is complex and can be painful, often involving intravenous delivery. Fourth, the preceding three factors pose significant challenges for research and development (R&D) financing. In addition, there are certain outside determinants that influence the biotech industry, including regulation, demography, reimbursement climate, and big pharma companies.

Stem cell research is one of the most fascinating areas of biology, but it raises questions as rapidly as it generates new discoveries. The greatest potential application of this research is the generation of cells and tissues that can be used for cell-based therapies. A stem cell is a special kind of cell that has a unique capacity to renew itself and to give rise to specialized cell types. Through the process of differentiation, stem cells form various tissues and organs, and the combination of these differentiated materials develops into the whole human body. This class of human stem cell holds the promise of being able to repair or replace cells or tissues that are damaged or destroyed by many of our most devastating diseases.

Diabetes mellitus is a group of diseases characterized by high levels of blood glucose resulting from defects in insulin production, insulin action, or both. Diabetes mellitus is a type I diabetes—also called juvenile-onset diabetes or insulin-dependent diabetes—and develops when the body’s immune system destroys pancreatic beta cells, the only cells in the body that make the insulin that regulates blood glucose. Type II diabetes, also called adult-onset diabetes or noninsulin-dependent diabetes, may account for 90–95 percent of all diagnosed cases of diabetes. There are more than 194 million diabetics worldwide, with this number expected to exceed 333 million by 2025.

Insulin is currently the most effective drug for controlling hyperglycemia and is widely accepted as the gold standard for treating type I diabetes and even late-stage type II diabetes. However, physicians and patients are reluctant to use insulin until other less effective drugs have been attempted. This is mainly because insulin therapy is invasive and painful: patients must take insulin intravenously.

One of the most promising ways to cure diabetes is to restore the function of islet cells biologically, either through islet cell transplantation or by engineering cells to restore the insulin secreting function. Islet transplantation, a procedure that can restore insulin production in patients, is a highly promising area of research.

Based on analysis of stem cell research, diabetes market opportunities, and the development of stem cell therapies, it is possible to place a value on a company in the early (preclinical) development stage of a stem cell therapy for diabetes. Such an exercise involves valuing a company based on three different approaches—(1) the discounted cashflow model, (2) the royalty or licensing model, and (3) the comparables valuation model. Sensitivity analysis based on market, pricing, costing, R&D, and development stage can further lead to precise valuation range for a given company.

For biotechnology companies, various drivers play a critical role in company valuation, including people (management team), alliances and partnerships, intellectual property rights, R&D and technology, funding and financing, market opportunity, and therapeutic area.

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Conference on Healthcare Payment Incentives in the Asia Pacific

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Karen Eggleston
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The Asian health policy program is pleased to announce that a conference on "Provider Payment Incentives in the Asia Pacific" will be held November 7-8, 2008, at the China Center for Economic Research at Peking University in Beijing, P.R. China.

Organizers of the conference include health economists at the Shorenstein Asia-Pacific Research Center at Stanford University; the China Center for Economic Research at Peking University; Tsinghua University School of Economics and Management Department of Economics; and Seoul National University School of Public Health.

We welcome empirical and theoretical research analyzing how reimbursement incentives shape health and healthcare behavior in the economies of the Asia Pacific. We especially welcome evaluations of policy reforms and natural experiments impacting health service provider incentives. The papers can examine payment incentives in one country, region, or healthcare setting, or include comparative analysis of two or more regions in the Asia Pacific.

Please email papers or extended abstracts (about 500 words) to Karen Eggleston. The submissions deadline is June 1, 2008. The selection committee will notify authors by July 1, 2008.

We also encourage inquiries from researchers that may have access to relevant payment reform data but are interested in support regarding their research design or analytic methods. We will work with you to identify appropriate collaborators and possible financial support for completing the research.

Authors of papers selected for presentation will receive partial subsidy for their participation in the conference as well as opportunity to publish their research in a special volume through the Shorenstein Asia-Pacific Research Center at Stanford University or in a special issue of an English-language health policy journal.

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John Hagel and Henry Chesbrough deliver keynote addresses at "The Shape of Things to Come" conference

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George Krompacky
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"The Shape of Things to Come," a conference presented by the Stanford Program on Regions of Innovation and Entrepreneurship on January 17-18, 2008, featured keynotes by John Hagel, co-author of The Only Sustainable Edge and Co-Chairman of the Deloitte Center for Edge Innovation, and Dr. Henry Chesbrough, Executive Director of the Center for Open Innovation at the Haas School of Business at UC Berkeley and author of Open Innovation.

The keynotes bookended Thursday's forum, "New Patterns and Paradigms in Global Innovation Networks," and were a prelude to Friday's academic workshop, "A Global Perspective on Regional Innovation Indicators." Hagel's talk focused on the need for a more explicit taxonomy of innovative collaboration and discussed the "huge need to define pragmatic migration paths"--routes that the average manager and company can take to reach the opportunities that normally are only accessible to cutting-edge companies.

The forum closed with a presentation by Dr. Henry Chesbrough, who provided an overview on the globalization of innovation in the Chinese semiconductor industry, which he sees as split into a "globally oriented, globally competitive" industry segment and a domestically-oriented segment with "backward technologies" and lacking access to capital. The question, he explained, is how China will shift its resources, now entrenched in the latter, to the former, competitive segment.

Chesbrough finished with a discussion of intellectual property rights (IPR) in China, looking at flows of knowledge and current IPR challenges; he mentioned some surprising developments--the rise of businesses to "promote the legal exchange of IP" and the growth of a domestic constituency for stronger IPR--and discussed future implications for IPR in China.

In between the keynotes, the forum featured sessions on innovation in internet services in China, the role of venture capital as a network builder, and discussions on two rapidly moving industries: cleantech and thin film transistor LCD displays.

Conference materials, including presentations and audio files, will be made available on the SPRIE website.

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Center invites applications for newly established post-doctoral fellowship in comparative health policy

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Karen Eggleston
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Stanford University's Walter H. Shorenstein Asia-Pacific Research Center is pleased to announce the establishment of a postdoctoral fellowship in comparative health policy for the 2008-09 academic year. The fellowship will support a junior scholar who will conduct research and writing on contemporary health or healthcare in two or more countries of the Asia-Pacific. We welcome applications from scholars from a variety of disciplines, such as sociology, political science, economics, anthropology, public policy, law, health services research and related fields.
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The Shape of Things to Come: New Patterns and Paradigms in Global Innovation Networks

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Patterns and paradigms for innovation are fundamentally changing--they are becoming more global, multidisciplinary, collaborative and complex. At the same time, innovation is extending far beyond disruptive technologies which lead to new products. Increasingly, innovation is being found in services, processes, business models and policies. At the center of these changes are global innovation networks.

The Stanford Program on Regions of Innovation and Entrepreneurship (SPRIE) is bringing together thinkers, investigators and practitioners from the U.S., Asia and Europe for a two-day international, cross-disciplinary discussion and debate on the understanding of innovation networks.

You are invited to attend the first day of this conference, a forum entitled, "The Shape of Things to Come: New Patterns and Paradigms in Global Innovation Networks." It will take place at the Arrillaga Alumni Center at Stanford University on Thursday, January 17.

The event will feature two keynote speakers:

John Hagel, Co-Chairman of the Deloitte Center for Strategy and Technology, co-author of The Only Sustainable Edge: Why Business Strategy Depends on Productive Friction and Dynamic Specialization (with John Seely Brown)

Dr. Henry Chesbrough, Executive Director of the Center for Open Innovation, Haas School of Business, University of California at Berkeley and author of Open Innovation: The New Imperative for Creating and Profiting from Technology.

Planned forum sessions include:

"Shifting Innovation Networks in China" with a focus on Internet services;

"Venture Capital as Network Builder," how venture capital enables innovation networks;

"Perspectives on Rapidly Moving Technologies," like cleantech and flat panels.

A continental breakfast and lunch will be served, and the day will conclude with a networking reception.

» Presentations/Papers from the event

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Frances C. Arrillaga Alumni Center

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Health Service Delivery in China: A Literature Review

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We report the results of a review of the Chinese- and English-language literatures on service delivery in China, asking how well China's health-care providers perform and what determines their performance. Although data and methodological limitations suggest caution in drawing conclusions, a critical reading of the available evidence suggests that current health service delivery in China leaves room for improvement, in terms of quality, responsiveness to patients, efficiency, cost escalation, and equity. The literature suggests that these problems will not be solved by simply shifting ownership to the private sector or by simply encouraging providers - public and private - to compete with one another for individual patients. By contrast, substantial improvements could be (and in some places have already been) made by changing the way providers are paid - shifting away from fee-for-service and the distorted price schedule. Other elements of active purchasing by insurers could further improve outcomes. Rigorous evaluations, based on richer micro-level data, could considerably strengthen the evidence base for service delivery policy in China.

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China's Harmonious Society: Political Cross Currents in China's Corporate Restructuring

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China's Harmonious Society colloquium series is co-sponsored by the Stanford China Program and the Center for East Asian Studies

Since 2006, the official doctrine of China's Communist Party calls for the creation of a "harmonious society" (HeXieSheHui). This policy, identified with the Hu Jintao leadership, acknowledges the new problems that have emerged as China continues its amazing economic growth. The economy is booming but so are tensions from rising inequality, environmental damage, health problems, diverse ethnicities, and attempts to break the "iron rice bowl." In this series of colloquia, leading authorities will discuss the causes of these tensions, their seriousness, and China's ability to solve these challenges.

Depending on where one stands, China's state-owned enterprises have reformed too slowly or too fast. Some lament the incompleteness of China's efforts to break the "iron rice bowl," to free firms from inefficient industrial practices, to rid firms of non-production expenses. Yet, as incomplete and slow as the reforms seem to some, New Left critics charge that China's reforms have gone too far, that SOEs have been subject to asset stripping, that firms have been "given away," and that the privileged few, particularly factory managers, have become rich capitalists overnight, through corruption and collusion with local officials. The losers in this view are the workers, who have been left unemployed, subject to layoffs, without health care, and sometimes without even their promised pensions-the very problems that prompted Hu Jintao's call for fixes to create a new "harmonious society." These two views of SOE reform, while seeming to convey different realities, reflect the political cross currents that have shaped China's corporate restructuring. Based on recent research in China, Jean Oi will discuss how those charged with reforming SOEs have tried to walk the tightrope between too slow and too fast reform, and the consequences.

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Jean C. Oi

Department of Political Science
Stanford University
616 Serra Street
Stanford, CA 94305-26044

(650) 723-2843 (650) 725-9401
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Senior Fellow at the Freeman Spogli Institute for International Studies
William Haas Professor in Chinese Politics
jean_oi_headshot.jpg PhD

Jean C. Oi is the William Haas Professor of Chinese Politics in the department of political science and a Senior Fellow of the Freeman Spogli Institute for International Studies at Stanford University. She is the founding director of the Stanford China Program at the Walter H. Shorenstein Asia-Pacific Research Center. Professor Oi is also the founding Lee Shau Kee Director of the Stanford Center at Peking University.

A PhD in political science from the University of Michigan, Oi first taught at Lehigh University and later in the Department of Government at Harvard University before joining the Stanford faculty in 1997.

Her work focuses on comparative politics, with special expertise on political economy and the process of reform in transitional systems. Oi has written extensively on China's rural politics and political economy. Her State and Peasant in Contemporary China (University of California Press, 1989) examined the core of rural politics in the Mao period—the struggle over the distribution of the grain harvest—and the clientelistic politics that ensued. Her Rural China Takes Off (University of California Press, 1999 and Choice Outstanding Academic Title, 1999) examines the property rights necessary for growth and coined the term “local state corporatism" to describe local-state-led growth that has been the cornerstone of China’s development model. 

She has edited a number of conference volumes on key issues in China’s reforms. The first was Growing Pains: Tensions and Opportunity in China's Transformation (Brookings Institution Press, 2010), co-edited with Scott Rozelle and Xueguang Zhou, which examined the earlier phases of reform. Most recently, she co-edited with Thomas Fingar, Fateful Decisions: Choices That Will Shape China’s Future (Stanford University Press, 2020). The volume examines the difficult choices and tradeoffs that China leaders face after forty years of reform, when the economy has slowed and the population is aging, and with increasing demand for and costs of education, healthcare, elder care, and other social benefits.

Oi also works on the politics of corporate restructuring, with a focus on the incentives and institutional constraints of state actors. She has published three edited volumes related to this topic: one on China, Going Private in China: The Politics of Corporate Restructuring and System Reform (Shorenstein APARC, 2011); one on Korea, co-edited with Byung-Kook Kim and Eun Mee Kim, Adapt, Fragment, Transform: Corporate Restructuring and System Reform in Korea (Shorenstein APARC, 2012); and a third on Japan, Syncretism: The Politics of Economic Restructuring and System Reform in Japan, co-edited with Kenji E. Kushida and Kay Shimizu (Brookings Institution, 2013). Other more recent articles include “Creating Corporate Groups to Strengthen China’s State-Owned Enterprises,” with Zhang Xiaowen, in Kjeld Erik Brodsgard, ed., Globalization and Public Sector Reform in China (Routledge, 2014) and "Unpacking the Patterns of Corporate Restructuring during China's SOE Reform," co-authored with Xiaojun Li, Economic and Political Studies, Vol. 6, No. 2, 2018.

Oi continues her research on rural finance and local governance in China. She has done collaborative work with scholars in China, including conducting fieldwork on the organization of rural communities, the provision of public goods, and the fiscal pressures of rapid urbanization. This research is brought together in a co-edited volume, Challenges in the Process of China’s Urbanization (Brookings Institution Shorenstein APARC Series, 2017), with Karen Eggleston and Wang Yiming. Included in this volume is her “Institutional Challenges in Providing Affordable Housing in the People’s Republic of China,” with Niny Khor. 

As a member of the research team who began studying in the late 1980s one county in China, Oi with Steven Goldstein provides a window on China’s dramatic change over the decades in Zouping Revisited: Adaptive Governance in a Chinese County (Stanford University Press, 2018). This volume assesses the later phases of reform and asks how this rural county has been able to manage governance with seemingly unchanged political institutions when the economy and society have transformed beyond recognition. The findings reveal a process of adaptive governance and institutional agility in the way that institutions actually operate, even as their outward appearances remain seemingly unchanged.

China’s Belt and Road Initiative

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Fiscal Politics and Central-Local Relations in China

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Structural Change in China

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Director, China Program at the Walter H. Shorenstein Asia-Pacific Research Center
Lee Shau Kee Director of the Stanford Center at Peking University
Faculty Affiliate at the Stanford Center on China's Economy and Institutions
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Jean C. Oi William Haas Professor in Chinese Politics, Professor of Political Science, Senior Fellow at FSI, and Director, Stanford China Program Speaker Stanford University
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Why Pyongyang Invited the New York Philharmonic

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Some people said North Korea would not survive the end of the USSR and dissolution of the Soviet bloc. Some people said Kim Jong Il's likely tenure could be measured in months. Some people said that North Korea was on the verge of collapse in 1997; some people, in fact, proclaimed that the economy had already collapsed.

What sorts of myths and misperceptions do we entertain and perpetuate that make it difficult for us to deal with North Korea coherently?

Robert Carlin is a 2007 Pantech Fellow at Shorenstein Asia-Pacific Research Center and has been a visiting fellow at the Center for International Security and Cooperation at Stanford University since 2005. After receiving an A.M degree from Harvard University's East Asian Regional Studies program, he joined the Central Intelligence Agency in 1971. From 1974 to 1988, he was a senior North Korea media analyst in the Foreign Broadcast Information Service (FBIS), where he received the director of the CIA's Exceptional Analyst Award. From 1989 to 2002, he was the chief of the Northeast Asia Division in the State Department's Bureau of Intelligence and Research. Concurrently, from 1993 to 2002, Mr. Carlin served as senior policy advisor to the U.S. special envoy for talks with North Korea, taking part in every significant set of U.S.-DPRK negotiations of which there were many--during those years. He was on the delegation accompanying Secretary of State Madeline Albright to Pyongyang in October 2000. From 2003 to 2005, Mr. Carlin was senior political advisor to the executive director of the Korean Peninsula Energy Development Organization (KEDO), leading numerous KEDO negotiating teams to the DPRK. Altogether, he has made 25 trips to North Korea.

Much of Mr. Carlin's analysis on North Korea from his years at FBIS has been declassified and is available either in the "Trends in Communist Propaganda" or "Trends in Communist Media". Over the years, he has written chapters for several books on the Korean issue including, most recently, "Talk to Me, Later," appearing in North Korea: 2005 and Beyond. In 2006, he co-authored an IISS Adelphi paper "North Korean Reform: Politics, Economics and Security." His essay on negotiating with North Korea will appear in Korea 2007 - Politics, Economy, Society. Over his career, Mr. Carlin has lectured at the Harry S. Truman Presidential Library, the State Department's Foreign Service Institute, foreign ministries and intelligence organizations abroad, and numerous universities.

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