Externally Sourcing Research through Acquisition: Should it Supplement or Substitute for Internal Research?

Karen Ruckman

Industry and Innovation, 2008, vol. 15, issue 6, 627-645

Abstract: A technology motivated acquirer can use a target's technology to supplement or substitute for its own internal research. The impact of the extent of integration on post-acquisition performance is further complicated by the effects of pre-acquisition research relatedness between the target and acquirer. This study determines the integration and research relatedness of acquisitions in the US biopharmaceutical industry during the 1990s and then examines their impact on profitability. The results indicate that related research that supplements (or is integrated into) internal research increases post-acquisition profits as does unrelated research which substitutes for (or is kept separate from) internal research.

Keywords: Acquisitions; research and development; resource-based view; performance; pharmaceuticals; technology sourcing (search for similar items in EconPapers)
Date: 2008
References: View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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DOI: 10.1080/13662710802550976

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