Access to Financing and the Institutional Environment: Does the Type of Capitalism Model Matter for Biotech Firms?[Accès au financement et environnement institutionnel : le modèle de capitalisme importe-t-il pour les entreprises biotechnologiques ?]

A key factor for economic growth is the financial access available to innovative firms and the creation of favorable conditions to ease this financing. Using a sample of over 1,000 international biomedical firms, we investigate whether structural, social, and economic factors influence the ability of these firms to issue stocks and enhance stockholders' equity. Hence, we classify our sample by the type of capitalism model (bank-oriented vs market-oriented financial systems) and control the determinants of stock issue and stockholders' equity with individual and cyclical characteristics. Interestingly, neither stock issues nor stockholders' equity are strongly driven by the type of capitalism model, and have many similar individual determinants. Consequently, the market fund-raising of listed biotech firms and their choice of capital structure is not fully dependent on the general, social, and economic conditions in their countries. Pairwise Wald tests of cross-sub-sample coefficient equality reveal a sharper structure than a coefficient-by-coefficient comparison would suggest. Approximately 36–43 % of SI determinants display statistically distinct coefficients across MOM and BOM sub-samples, whereas only about 14–21 % of SE determinants do so. The institutional context shapes the firm-level response of equity issuance flows more than the firm-level response of equity stocks. We interpret this through a flow-versus-stock proposition: institutional persistence operates predominantly through (i) the coefficients of flow variables and (ii) the intercepts of stock variables, but only weakly through the coefficients of stocks themselves. The country effect on SE documented through an Ordered Logit specification (Section 5) is therefore consistent with a level effect (different intercepts across countries) combined with response homogeneity (similar slopes across countries) for the equity-stock variable.