Faculty of Economics and Business Administration Publications Database

Post-merger integration of international biotechnology start-ups – The relationship between entrepreneurial strategy, culture and human resources

Authors:
Source:
Volume: 61
Number: 1
Pages: 133 - 153
ISSN-Print: 0044-2372
ISSN-Online: 1861-8928
Year: 2009
Abstract:

International M&A activities of biotech firms can support the entrepreneurial firms’ growth strategy. Based on four in-depth case studies, this paper analyzes the consequences for the culture and human resources of biotechnology firms as a result of the chosen strategy. Although the selected strategy helps to realize the motives (survival, growth, bringing a drug to the market) linked with the merger, there are also negative effects associated with it. This study reveals that there is a need to distinguish between both national and organizational cultural differences and that national cultural differences are less important for a successful post-merger integration of international biotechnology start-ups. The entrepreneurial culture and mindset of the biotechnology firm is replaced by a culture focusing on research and discovery so that the biotechnology firm is less attractive for entrepreneurial and high-risk-taking managers, but more attractive for research-oriented and low-risk-taking managers. This is also reflected in the adaptation of the prevailing incentive systems to the new context by replacing the stock option programs by more traditional incentive and bonus plans. Moreover, this study comes to the conclusion that entrepreneurs are ready to give up part of their independence and entrepreneurial culture in order to realize the long-term survival and growth of their venture.

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