Correspondence: Ken Malone, The Trent Lott National Center of Excellence for Economic Development & Entrepreneurship, The University of Southern Mississippi, 118 College Drive, Hattiesburg, MS 39406, USA. Tel: +1 601 266 4736; E-mail: ken.malone@usm.edu

¹is Director of the Trent Lott National Center of Excellence for Economic Development & Entrepreneurship at the University of Southern Mississippi. He holds a PhD in Polymer Science and has 15 years of business management experience with global specialty chemical companies.

²is an assistant professor of the Trent Lott National Center of Excellence for Economic Development & Entrepreneurship at the University of Southern Mississippi and holds a PhD in rural sociology and has published on technology councils and entrepreneurship.

³is a PhD candidate in the Department of Polymer Science at the University of Southern Mississippi.

⁴is a PhD candidate in the Department of Medicinal Chemistry at the University of Mississippi.

⁵is a graduate student working for the Trent Lott National Center of Excellence for Economic Development & Entrepreneurship.

Received 7 September 2007; Revised 7 September 2007; Published online 27 November 2007.

Abstract

Insight into the development of the medicinal biotechnology sector of China is provided through interviews of 19 Shanghai-based companies. Two commonly accepted strategy typologies are used to provide a predictive frame towards understanding their potential in the market. Most of the companies interviewed use the Miles & Snow Analyser Strategy. Two companies were clearly Prospectors, with founders of both discovering their technologies in laboratories of developed countries. The Porter Generic Strategy typology indicated that most are using Cost Leadership strategies. The strategic choice of these companies is problematic given the dynamics of the global market in which they could participate but are more sensible within the context of a protected market. For example, it appears that government-sponsored monopoly policies are driving low-cost strategies rather than innovation-based differentiation strategies.