Asymmetrical
alliances are particularly interesting due to the imbalance
of power between the partners, sometimes leading to the
acquisition of the smaller firm by its larger partner. The
pharmaceutical sector has a natural tendency for deals between
very large and very small companies. In this fast-paced,
technology-driven industry, small biotechnology companies
have proliferated rapidly in the last decade, leveraging
the fact that research for new biotechnology-based drugs
does not require large infrastructure. Recently thebiotech
firms have been responsible for a large portion of the research
and development in the industry, attracting the interest
of the large pharmaceutical companies. Through the so-called
“pharma-biotech” alliances, pharmaceutical giants
have found a way to supplement their drug development pipelines,
whereas small biotech firms have been able to multiply the
potential of their discoveries, leveraging the pharmaceutical
companies’ regulatory experience and marketing strength.
Nevertheless,
the differences between large pharma companies and smaller
biotech firms pose significant threats to the success of
deals.
This
paper analyzes the dynamics of asymmetrical alliances in
the health industry sector, where deals between large pharmaceutical
companies and small biotechnology firms have become extremely
common.
