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Intangibles and the Market Value of Biopharmaceutical Startups

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  • Morales, Rosa
  • Radoniqi, Fatos

Abstract

his paper investigates the relationship between various measures of intangible capital and the market valuation of young biopharmaceutical firms. We employ a non-linear model to measure the impact of R&D, patents, alliances, organizational capital, and mergers on the value of 349 newly-incorporated firms between 1980 and 2006. We find that, with the exception of mergers, our measures of intangible capital havepositive and significant effects on market values; the impact of R&D declines as firms mature; and the omission of either alliances or organizational capital leads to a significant overstatement of the influence of R&D.

Suggested Citation

  • Morales, Rosa & Radoniqi, Fatos, 2017. "Intangibles and the Market Value of Biopharmaceutical Startups," MPRA Paper 88580, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:88580
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    More about this item

    Keywords

    Innovation; R&D; Intangible Assets; Market Valuation; Biopharmaceuticals;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology; Plastics
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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