This report introduces the concept of knowledge networks and markets (KNMs), and discusses the new organisations and mechanisms that are emerging to share and to trade an increasing variety of knowledge-intensive assets. It describes numerous case studies of such initiatives in order to illustrate the variety of open knowledge management approaches. The report discusses the technological, economic and industrial environments that have led to the rise of KNMs, and in particular delves into advances in both computer science and knowledge valuation that could further facilitate the representation and exchange of knowledge assets. The report argues that the creation of such exchange mechanisms is an important new trend in the life sciences, and particularly in the health sector, with potentially profound influence on the innovation process. Despite the novelty of KNMs, this report identifies some early policy lessons about the role of governments in the creation and maintenance of KNMs.

There is a proliferation of initiatives in the life sciences to bring together dispersed and diverse elements of the research infrastructure and simplify the process for learning about, accessing and utilising sometimes dispersed knowledge and intellectual assets. The common goal of these initiatives is to leverage innovative capacity by creating interconnected webs of knowledge that exploit external expertise. Recent advances in information technology make these initiatives possible: the storage capacity of data; its ease of transmissibility across the Internet; the development of software to access, make interoperable and analyse data, as has the creation of governance systems that regulate access and use of data. In this report, we refer to such initiatives as “knowledge networks and markets” (KNMs).

Within the past five years there has been an explosion in the development of knowledge networks and markets (KNMs) in the life sciences. This chapter sets out the context for the development of these phenomena, provides a rudimentary operational taxonomy, and sets out some overarching questions about their impact on innovation productivity as well as what governments might need to do to influence their success.

Knowledge is at the core of innovation and needs to flow effectively if productivity is to be efficient. But knowledge also has great value and is jealously guarded by innovators. This chapter explores how the “knowledge complex” – the flow and exchange of knowledge – in the biosciences is changing as the volume of knowledge increases and the numbers and variety of actors involved in knowledge creation and use grow. The functioning of knowledge networks and markets are set in the context of this new knowledge complex.

This chapter explains what specific economic, innovation, and health-related concerns are driving the widespread experimentation in the life sciences with novel knowledge networks and markets (KNMs) as well as how these motivate participants. Four major themes emerge. There is a common desire to: i) accelerate the health innovation cycle; ii) reduce the risk and costs of research and development; iii) translate scientific advances into products that better meet societal health needs; and iv) reduce health-care expenditures.

This chapter discusses.. how advances in information technologies are informing the design of knowledge networks and markets (KNMs), drawing heavily on experiences and insights from the ICT sector before applying some of the concepts from that sector to KNMs in biomedicine. The chapter first describes how, theoretically, knowledge markets are structured and function, and how some market failures could be overcome through better mechanism design. The chapter then discusses the importance of interoperability of separate data resources in biomedicine, and how to make these resources more interoperable and useful to many researchers. Finally, the chapter proposes how to apply these theoretical approaches to KNMs design, and to create a framework for understanding real-world examples of KNMs in biomedicine.

This chapter reviews several types of knowledge networks and markets (KNMs) that are currently in use in the life sciences and describes case study KNMs. For each case, the purpose, membership, the business model and type of knowledge exchanged in the KNMs in question is discussed.

This chapter discusses future trends in the valuation of biotechnology and pharmaceutical assets as well as the companies that hold them, the development of new forms of financing health research, and how these developments impact on and may be influenced by knowledge networks and markets (KNMs) and new models of knowledge management. Several open questions remain, including: will improved valuation of biomedical firms and their assets also entail a better understanding and use of such intellectual assets and, if so, how might KNMs facilitate progress? And, can KNMs be constructed and operated so that they successfully reduce financial risk to their participants as well as increasing efficiency of innovation through collective action?

This final chapter presents conclusions and policy recommendations. It identifies what are the common features of knowledge networks and markets (KNMs) and on what criteria they differ. It reiterates why KNMs matter for innovators in the biopharmaceutical sector, in particular because of their contribution to: addressing financial pressures, accelerating science and development, improving health outcomes, and improving the regulatory dialogue. The chapter concludes with a review of the support that KNMs currently enjoy from government and sets out proposals for possible future focus.