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Technology, Cooperation And Stock Market Value : An Event Study Of New Partnership Announcements In The Biotechnology And Pharmaceutical Industries

Author

Listed:
  • Sandy Campart

    (CERENE - Centre d'Etude et de Recherche en économiE et gestioN LogistiquE - ULH - Université Le Havre Normandie - NU - Normandie Université)

  • Etienne Pfister

    (BETA - Bureau d'Économie Théorique et Appliquée - INRA - Institut National de la Recherche Agronomique - UNISTRA - Université de Strasbourg - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique)

Abstract

We use the event study methodology to investigate the share price responses to the formation of 281 partnerships inthe biotechnology/pharmaceutical industry over the years 1995–2000. The average stock price response is positive,more so than in previous empirical works, which could be interpreted as evidence that interfirm collaboration isparticularly valuable in high-technology industries. Research and development (R&D) partnerships also generatehigher abnormal returns (relative to production or marketing agreements). On average, smaller firms in the partnershipseem to appropriate a very significant share of the cooperative surplus, especially when they receive large technologypayments or when the partnership is concluded in the R&D stage. On the other hand, partnership announcements ofmore profitable firms tend to be associated with higher abnormal returns.

Suggested Citation

  • Sandy Campart & Etienne Pfister, 2007. "Technology, Cooperation And Stock Market Value : An Event Study Of New Partnership Announcements In The Biotechnology And Pharmaceutical Industries," Post-Print halshs-00337305, HAL.
    • Handle: RePEc:hal:journl:halshs-00337305
    DOI: 10.1080/10438590600661764
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    Cited by:

    1. Cristiano Antonelli & Morris Teubal, 2010. "Venture Capitalism as a Mechanism for Knowledge Governance," Chapters, in: Riccardo Viale & Henry Etzkowitz (ed.), The Capitalization of Knowledge, chapter 3, Edward Elgar Publishing.
    2. Antonelli, Cristiano & Teubal, Morris, 2008. "Venture Capital as a Mechanism for Knowledge Governance: New Markets and Innovation-Led Economic Growth," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 200805, University of Turin.

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