Abstract: State and Innovative Enterprises: The Case of the Cuban Biopharmaceutical Industry

Andres Cardenas O'Farrill


Innovative business enterprises are part of complex and interrelated sets of heterogeneous elements deeply rooted in specific historic contexts. This is particularly true when we analyze the peculiar case of the Cuban biopharmaceutical industry. Although the pervasive lack of data makes it difficult to establish an accurate picture of the innovative outcomes of Cuba's biopharmaceutical industry, the available evidence of its achievements seems to be unequivocal. For instance, nearly 80 percent of finished pharmaceutical products used in the country are locally made, and several of the products manufactured and exported by the industry are not just generics, but include a significant number of innovative drugs and vaccines, some of them recipients of international awards. The first question that arises is: how did a country like Cuba managed to achieve these results? By ''country like Cuba'' it is meant an essentially non-market, almost absurdly state-controlled (and mostly inefficient) economy, virtually detached from world technology networks by the U.S. embargo. A close examination shows, however, that many of these handicaps might have become the very strength of the Cuban biopharmaceutical industry. In this contribution we will trace a causal chain showing how various variables interacted over time to produce this historical outcome. It will be argued that the long-term government efforts to finance and integrate all these institutions around a common organizational culture have been critical to the innovative outcomes achieved by the industry. Far from being an exceptional tropical rarity, this case might be the confirmation of a—hitherto ignored—robust body of cross-country historicsl evidence, which shows that to assume the government away is not part of the solution but actually part of the problem that most of the world faces today.

BEH On-Line Paper