The Control of Strategic Alliances: An Empirical Analysis of Biotechnology Collaborations
Robert P. Merges
University of California, Berkeley - School of Law
Harvard Business School - Finance Unit; Harvard University - Entrepreneurial Management Unit; National Bureau of Economic Research (NBER)
In this paper, we examine the determinants of control rights in technology strategic alliances between biotechnology firms and pharmaceutical corporations, as well as with other biotechnology firms. We undertake three clinical studies and an empirical analysis of 200 contracts. Consistent with the framework developed by Aghion and Tirole (1994), the allocation of control rights to the smaller party increases with its financial health. The empirical evidence regarding the relationship between control rights and the stage of the project at the time the contract is signed is less consistent with theoretical frameworks.
working papers series
Date posted: September 15, 1997
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