Abstract
Classic views of innovation describe a relatively standard trajectory that an idea has to follow to become a profitable product. However, in Russia national policies to stimulate innovation are unpredictable and create a risky economy. This chapter, based on documents and interviews, discusses the experiences and strategies of hi-tech companies’ directors developing medical equipment in Russia. Four strategies are distinguished—smaller-scale tactics, conformist, reformist, and isolationist. While the latter is most creative, imaginary, and innovative, it is also rare. Most entrepreneurs respond to unpredictable policy agendas and rule setting by focussing on creating barely innovative products. This implies that the Russian devices market still mostly relies on copying, localising, and adapting foreign products.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
RUSNANO is corporation that ‘implements state policy for the development of the nano-industry in Russia, acting as a co-investor in nanotechnology projects that have substantial economic or social potential’. http://en.rusnano.com/about
- 2.
The state budget used for the unemployed individuals and for purchasing high-tech medical interventions.
- 3.
Federal Law ‘The circulation of medical products’ is devoted to control of the technical tests, clinical trials, efficacy, safety, production, manufacture, sale, storage, transportation, and importation of medical devices.
- 4.
Russian Federation Government Decree of February 2015, ‘On Restricting Access for Certain Types of Medical Products Originating From Foreign Countries for the Purposes of Procurement for State and Municipal Needs’. Known as ‘three’s a crowd’, it restricts competition in tenders to supply imported medical items to state-sector medical establishments. A reminder here that 80 per cent of Russian medicine is state-run.
- 5.
According to research on Russian politics, since 1993 (the adoption of the Constitution of the Russian Federation), the Parliament has not played any significant role as a public institution, or a significant role in the system of separation of powers (see e.g. Gelman 2015).
- 6.
The development institutes are a ‘government policy tool that stimulates innovation processes and infrastructure development using private–public partnership mechanisms. The main aim of the development institutes is to overcome so-called gaps in the market in order to solve problems that cannot be optimally realised through market mechanisms, for the purpose of securing steady economic growth and diversification of the economy’ (Economic Development Ministry, http://economy.gov.ru/minec/activity/sections/instdev/institute).
- 7.
Alexei Kudrin, the former Finance Minister, now heads a working group of the Russian Presidential Economic Council.
References
Abell, D. F. (1980). Defining the business: The starting point of strategic planning. Englewood Cliffs, NJ: Prentice Hall.
Aven, T., & Renn, O. (2010). Risk management and governance: Concepts, guidelines, applications. Heidelberg: Springer.
Balzer, H., & J. Askonas. (2016). The Triple Helix after communism: Russia and China compared. Triple Helix, 2, 13. Retrieved from http://triplehelixjournal.springeropen.com/articles/10.1186/s40604-015-0031-4
Barsukova, S. (2004). Informal economy: Economic and sociological analysis (Neformal’naya ekonomika: ekonomiko-sotsiologicheskii analiz) (p. 447). Moscow: SU HSE.
Block, F. (2011). Innovation and the invisible hand of government. In F. Block & M. R. Keller (Eds.), State of innovation: The U.S. government’s role in technology development (pp. 1–26). Boulder, CO and London: Paradigm Publishers.
Breznitz, D. (2007). Innovation and the state: Political choice and strategies for growth in Israel. New Haven and London: Yale University Press.
Bychkova, O., Chernysh, A., & Popova, E. (2015). Dirty dances: Academia-industry relations in Russia. Triple Helix, 2, 13. Retrieved from http://triplehelixjournal.springeropen.com/articles/10.1186/s40604-015-0019-0
Chrisman, J. J., Hofer, C. W., & Boulton, W. R. (1988). Toward a system of classifying business strategies. Academy of Management Review, 13(3), 413–428.
Dezhina, I., & Etzkowitz, H. (2016). Path dependence and novelties in Russian innovation. Triple Helix A Journal of University-Industry-Government Innovation and Entrepreneurship, 3, 11.
Etzkowitz, H. (2008). The Triple Helix: University-industry-government innovation in action. London: Routledge.
Etzkowitz, H., & Leydesdorff, L. (2000). The dynamics of innovation: From National Systems and ‘Mode 2’ to a Triple Helix of university-industry-government relations. Research Policy, 29(2), 109–123.
Foreign Trade. (1987). Foreign Trade of the USSR. The national economy of the USSR for 70 years. Anniversary statistical yearbook (Vneshnyaya torgovlya SSSR. Narodnoye khozyaystvo SSSR za 70 let. Yubileynyy statisticheskiy yezhegodnik). Retrieved from http://istmat.info/node/9321
Fujimura, J. H. (2003). Future imaginaries, genome scientists as sociocultural enterpreneurs. In A. H. Goodman, D. Heath, & S. M. Lindee (Eds.), Genetic nature/culture (pp. 176–199). Los Angeles, CA: University of California Press.
Funtowicz, S. O., & Ravetz, J. R. (1992). Three types of risk assessment and the emergence of post-normal science. In S. Krimsky & S. Golding (Eds.), Social theories of risk (pp. 251–274k). Westport, CT: Praeger.
Gel’man, V. (2015). Authoritarian Russia: Analyzing post-soviet regime changes (p. 208). Pittsburgh, PA: University of Pittsburgh Press (Pitt Series in Russian and East European Studies).
Gibbons, M., Limoges, C., Nowotny, H., Schwartzman, S., Seot, P., & Trow, M. (1994). The new production of knowledge: The dynamics of science and research in contemporary societies. London: Sage.
Goncharova, O., & Kruglikova, M. (2015). Kamyshovye KT. Vademecum. Retrieved June 5, 2015, from http://www.vademec.ru/article/kamyshovye_kt/
Grischenko, V. (2011). The advantages of localization of production of medical equipment in Russia is obvious (Preimuschestva lokalizatsii proizvodstva meditsinskogo oborudovaniya v Rossii ochevidny). Zdravookhranenie, 6. http://bujet.ru/article/138923.php
Health Systems. (2015). Health system in Russia. Official statistics, 2015. (Zdravookhranenie v Rossii. Ofitsial’nyi ezhegodnik), Moscow: Rosstat.
Irwin, A. (2008). STS perspectives on scientific governance. In E. Hackett, O. Amsterdamska, M. Lynch, & J. Wajcman (Eds.), The handbook of science and technology studies (3rd ed., pp. 583–607). Cambridge, MA: MIT Press.
Jasanoff, S. (1991). Acceptable evidence in a pluralistic society. In D. G. Mayo & R. D. Hollander (Eds.), Acceptable evidence: Science and values in risk management. New York: Oxford University Press.
Jasanoff, S. (Ed.). (2004). States of knowledge: The co-production of science and social order. London: Routledge.
Kalininskaya, A. A., & Kovalev, V. A. (2012). Organizational bases of state regulation and quality control of medical products (Organizatsionnyye osnovy gosudarstvennogo regulirovaniya i upravleniya kachestvom meditsinskoy produktsii). Health of Russian Federation, 3, 6–11.
Kamensky, A. (2014). V belom venchure iz roz (Venture capital rides to the rescue). Vademecum. Retrieved August 28, 2014, from http://www.vademec.ru/article/v_belom_venchure_iz_roz/
Kossals, L., & Ryvkina, T. (2002). Stanovlenie institute tenevoi ekonomiki v postsovetskoi Rossii (Making of shadow economy institutions in post-soviet Russia). Socis, 4, 13–21.
Makarova, E. (2015). Proizvoditeli iskusstvennykh klapanov serdtsa poprosili ob importozameshchenii (Manufacturers of artificial heart valves were asked about import substitution). Vademecum. Retrieved June, 25, 2015, from vademec.ru/news/2015/07/25/proizvoditeli_iskusstvennykh_klapanov_serdtsa_poprosili_ob_importozameshchenii/
Mazzucato, M. (2013). The entrepreneurial state: Debunking public vs private sector myths. London: Anthem Press.
Medical Industry. (1980). Great medical encyclopedia. In B. V. Petrovskiy (Ed.), M.: Soviet encyclopedia, 1974–1989 (Vol. 14, 3rd ed.). Medicine – Melanosis.
Medical Industry. (2013). Medical Industry of the Russian Federation’s development strategy for the period up to 2020. Retrieved from http://www.garant.ru/products/ipo/prime/doc/70239972/
Medicine Is Powerless. (2014). Medicine is powerless (Meditsina bessil’na). Expert-Ural Online, 26(606). Retrieved from http://expert.ru/ural/2014/26/meditsina-bessilna/
Medvedev, D. (2014). Speech at the plenary session of the forum ‘Open innovations’. Moscow. Retrieved from http://government.ru/news/15217/
Miles, R. E., & Snow, C. C. (1978). Organizational strategy, structure, and process. New York: McGraw-Hil.
Miller, D., & Friesen, P. H. (1984). Organizations: A quantum view. Englewood Cliffs, NJ: Prentice Hall.
Nevinnaya, I. (2007). Svoi tomograph blizhe k telu (Our own CT scanner counts for more). Rossiyskaya Gazeta, 5343(264).
Page, S. E. (2007). The difference: How the power of diversity creates better groups, firms, schools and societies. Princeton: Princeton University Press.
Paneyakh, E. (2008). The rules for the Russian businessman (Pravila igry dlya rossiiskogo predprinimatelya). Moscow: Kolibry.
Parker, J. N., Vermeulen, N., & Penders, B. (2010). Collaboration in the new life sciences. Farnham: Ashgate.
Radaev, V. (2009). Ekonomicheskaya bor’ba i sotsial’nyye svyazi: struktura konkurentnykh otnosheniy v novom rossiyskom riteyle (The economic struggle and social cohesion: Competitive relations in the new structure of Russian retail). Ekonomicheskaya Sotsiologiya, 10(1), 19–56.
Renn, O. (2008). Risk governance: Coping with uncertainty in a complex world. London: Earthscan.
Russell, D., & Russell, C. J. (1992). An examination of the effect of organizational norms, organizational structure, and environmental uncertainty on entrepreneurial strategy. Journal of Management, 18(4), 639–647.
Sazhin, S. (2015). Pochemu vash meditsinsky start-up ne vzletit? (Why won’t your medical start-up get off the ground?). Retrieved from http://rusbase.com/opinion/med-startups/
Segev, E. (1989). A systematic comparative analysis and synthesis of two business-level strategic types. Strategic Management Journal, 10, 487–505.
Simachev, I., Kuzyk, M., & Friginna, V. (2014). Vzaimodeistvie rossiiskikh kompanii i issledovaetlskikh organizatysii v provedenii NIOKR: tretii ne lishnii? (Cooperation between Russian Companies and Research Organizations in organizing and conducting R&D: Is the Third Spiral Superfluous? Vopr Ekon, 7, 4–34.
Smith, K. (1995). Interactions in knowledge systems: Foundations, policy implications and empirical methods. OECD STI Review, 16, Paris.
Stathakopoulos, V. (1998). Enhancing the performance of marketing managers—Aligning strategy, structure and evaluation systems. European Journal of Marketing, 23(5/6), 536–558.
Stirling, A. (2010). Keep it complex. Nature, 468, 1029–1031.
Stirling, A. (2014). Emancipating transformations: From controlling ‘the transition’ to culturing plural radical progress. Retrieved from http://stepscentre.org/wp-content/uploads/Transformations.pdf
Suchman, L., & Bishop, L. (2000). Problematizing “innovation” as a critical project. Technology Analysis & Strategic Management, 12(3), 327–333.
Sunder, R. K. (2005). Biocapital: The constitution of postgenomic life. Durham, NC: Duke University Press.
Thompson, M., & Warburton, M. (1985). Decision making under contradictory certainties: How to save the Himalayas when you can’t find what’s wrong with them. Journal of Applied System Analysis, 12, 3–33.
Volkov, V. (Ed.). (2000). Competition for the taxpayer: A study on fiscal sociology (Konkurentsiya za nalogoplatel’shchika: issledovaniya po fiskal’noy sotsiologii). Moscow: MONF.
Walport, M. (Ed.). (2014). Innovation: Managing risk, not avoiding it – evidence and case studies. Retrieved from https://www.gov.uk/government/publications/innovation-managing-risk-not-avoiding-it
Zomer, A. H., Jongbloed, B. W. A., & Enders, J. (2010). Do spin-offs make the academics’ heads spin? The impacts of spin-off companies on their parent research organisation. Minerva, 48, 331–353.
Acknowledgement
This chapter is supported by the European University at St. Petersburg. I thank the members of research project ‘Individual Strategies of Russian Hi-tech Entrepreneurs’ from European University at St. Petersburg, supported by RUSNANO, for sharing all data gathered during the project. I wish to thank the heads of Russian med-tech companies who were willing to tell me their stories and the experts on innovation policy in Russian regions who were willing to give an interview. I am also immensely grateful to Olga Bychkova, professor at the European University at St. Petersburg, and Ivan Tchakakov, professor at the University of Plovdiv, for their comments on an earlier version of the manuscript. I would also like to acknowledge the other editors of this volume, Klasien Horstman and Olga Zvonareva, for their comments that greatly improved the manuscript.
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2018 The Author(s)
About this chapter
Cite this chapter
Popova, E. (2018). Risky Economies: Innovation of Medical Devices in Russia. In: Zvonareva, O., Popova, E., Horstman, K. (eds) Health, Technologies, and Politics in Post-Soviet Settings. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-64149-2_4
Download citation
DOI: https://doi.org/10.1007/978-3-319-64149-2_4
Published:
Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-319-64148-5
Online ISBN: 978-3-319-64149-2
eBook Packages: Social SciencesSocial Sciences (R0)