Commercializing knowledge involves transfer from discovering scientists to those who will develop it commercially. New codes and formulae describing discoveries develop slowly - with little incentive if value is low and many competing opportunities if high. Hence new knowledge remains naturally...

We study a firm that justifies its novel use of equity derivatives as a cash-flow hedging strategy. Our purpose is to understand the challenge of translating risk management theory into managerial action. Cephalon Inc., a biotech firm, bought a large block of call options on its own stock. If...

While the variability of public equity financing has been long recognized, its impact on firms has attracted little empirical scrutiny. This paper examines one setting where theory suggests that variations in financing conditions should matter, alliances between small R&D firms and major...

Population ecology models are elegant in form and adequate in describing aggregate data, but poor in telling stories and predicting the location of growth. Fundamentals models emphasizing the variables central to resource mobilization, such as intellectual human capital, can predict where and...

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...

Advance of science and its commercial applications are in a close, symbiotic relationship in the U.S. biotechnology industry. Comparing Japan and the U.S., the structure of the science appears broadly similar, but the organization of the biotechnology industry is quite dissimilar. In the U.S.,...

We examine how two highly successful new biotechnology firms (NBFs) source their most critical input -- scientific knowledge. We find that scientists at the two NBFs enter into large numbers of collaborative research efforts with scientists at other organizations, especially universities. Formal...

We examine the relationship between the intellectual capital of scientists making frontier discoveries, the presence of great university bioscience programs, the presence of venture capital firms, other economic variables, and the founding of U.S. biotechnology enterprises during 1976-1989....

Managers of private entrepreneurial firms face obstacles in raising capital both in placing a value on a firm and conveying value to investors. These problems are exacerbated when the firm is small, has limited assets (except for human capital) and has yet to have a lead product. In such cases...

In the current paper we examine this industry along a number of dimensions and estimate its average financial risk. Specifically, we use Compustat and Center for Research in Securities Prices (CRSP) data from 1982 to 2005 for firms defined by the North American Industry Classification System...