The Rich Get Richer and the Poor Get Poorer: Social Media and the Post-IPO Behavior of Investors in Biotechnology Firms: The Relationship with Twitter Volume

This paper analyzes stock returns for biotechnology firms after initial public offering (IPO) and explores the effect of social media—specifically, Twitter—on these returns. The results indicate positive yet insignificant cumulative average abnormal returns (CAARs) of 1.97% in the first 25 days post-IPO and a decline of tens of percentage points over the following three years. However, after dividing the sample firms into two subsamples according to size, either under or over USD 500 million in market value, the overall results change dramatically. Firms with a market value lower than USD 500 million yield negative CAARs immediately following the IPO; however, this negative CAAR becomes significant only from day 50 onward. Firms with a market value over USD 500 million yield positive CAARs immediately following the IPO, which become significant from day 50, remaining so throughout the following year. These findings can be attributed to the limited duration of investors’ attention, which increases until the end of quiet period and, with small-sized firms, diminishes during the post-IPO years. An examination of Twitter activity and share returns demonstrates a robust correlation between the two, suggesting that investors’ attention to firms may be reflected in their Twitter usage.

Effect of private and public investment in R&D on innovation in Mexico’s biotechnology firms

Purpose In light of the controversy between the theoretical importance of financing biotechnology firms’ research and development (R&D), and the firms’ contradictory and ambivalent empirical results, this paper aims to contribute to the debate by providing empirical evidence from Mexico’s case. Design/methodology/approach The authors use the probit model to determine if firms’ achievements in innovations are related to both private and public financing, and if so, to calculate their marginal effect on the firms’ innovation (n = 40 from 53 firms: 75.5% response). The survey was applied in 2015. Findings Although a large proportion of the firms innovate and dedicate resources to R&D activities, neither private financing (different from the R&D portion of sales) nor public financing has an impact on innovation activity. Research limitations/implications It is necessary to increase the number of studies that corroborate the type of link established between innovations in biotechnology firms and financing. Analyzing the financing/innovation links at various stages of the innovation process would also be relevant. Originality/value The research results support the perspective that the theoretical relationship between the financing and achievements of innovation is not conclusive and point to relevant considerations for the public policy agenda of the case study.

Enhancing Firm Performance Through Adoption of Innovation: an Empirical Evidence from Indian Biotechnological Firms

This paper explores the influence of innovation approaches on innovation performance and firm performance among Indian biotechnology firms. Further, it aims to discuss the interceding role of innovation performance between innovation practices and firm performance. A criteria-based snowball sampling method was adopted for data collection. The collection of data was carried out using a web survey from 200 biotechnology firms located across India. The data is analysed using a covariance-based structural equation modelling (SEM) technique. The results indicate that the adoption of innovation practices positively influences the firms’ innovation and overall performance. Furthermore, the results confirm the mediating role of innovation performance between innovation approach adoption and firm performance. Firms, particularly from the biotechnology industry, can use these results to assess their performance and formulate or modify their strategy to improve their innovation and overall performance.

Asymmetric effects of alliance intensity on absorptive capacity: the differences between potential and realized capacities

PurposePrior research suggests that organizational alliances' contribution to innovation performance is conditional to absorptive capacity (AC). Instead of an antecedent of alliances, in this study, the authors conceptualize and evaluate AC as an outcome of alliance intensity.Design/methodology/approachThe authors tested their theoretical framework using multivariate statistical analysis on data collected from a survey applied to dedicated biotechnology firms (DBFs) from three countries: Brazil, Portugal and Spain.FindingsFirst, the results show that whereas the high alliance intensity effect is positive and stronger on RAC, it is negative and weaker on PAC. Second, the alliance intensity effect on RAC is strengthened when firms have alliances only in their home country and the top manager does not have both academic and managerial experiences.Practical implicationsThe authors’ study suggests as implications for DBFs: (1) firms should form alliances to develop AC, (2) firms should consider alliances for improving AC when top managers' expertise is not diverse, and (3) firms should consider only alliances with national partners as a differential for AC development.Originality/valueThis research contributes to the literature of dynamic capabilities, AC, alliances and innovation management by providing empirical validation for key contingencies surrounding the benefits of alliances as an antecedent of AC.

Innovation performance of biotechnology firms in Bulgaria: opportunities for enhancing

This paper deals with the investigation of the possibilities to improve the innovation performance in Bulgarian biotechnology firms. The main research purpose is to analyze Bulgaria's position concerning the innovative development of bio-based production. Methodological tools of the research methods were processing quantitative data, content analysis, and comparative situational analysis in combination with dynamic graphic analysis. The results of the research showed that there is a significant deficit in Bulgaria in the innovative development of biotechnology firms. The enhancement of the innovative biotechnological state of Bulgarian firms is a matter of great importance to their successful production and market performance on both the local and international markets. A small number of firms manage to find an adequate solution to creating stable market advantages and face insurmountable difficulties in trying to make it on the global market. Furthermore, Bulgaria's membership in the EU creates additional formal demands for providing a high quality of the production process, putting the local biotechnology firms in an even more challenging position. It suggests that companies need to focus their attention on producing goods with high added value (which is the basis of innovation) and applying and perfecting successful market-oriented approaches. In that relation, the arguments were summarized for the practical benefits of designing a complete model focused on biotechnology firms' market orientation, which is of crucial importance for their long-term innovative development. The study presents an author's conceptual model for measuring innovation performance of biotechnology firms which contains three constructs: market orientation, knowledge integration orientation, R&D effectiveness. The results from the conducted research could be helpful to research and practice R&D developers of firms with an established presence and long market history and upstart enterprises that cannot rely on income from their market activity, market or production experience.

Relative Versus Fundamental Valuation: An Empirical Study of US Biotechnology Firms Around the 2000 High-Tech Bubble

This study is related to the issue of whether the stock market reflects the fundamental value of high-tech firms around the 2000 high-tech bubble. We extend the literature on firm valuation by exploiting the conceptual difference between intrinsic and relative values. We apply the residual income model and valuation multiples to estimate these two values respectively and make a comparison for a sample of biotechnology firms. Under realistic assumptions, it seems that estimated fundamental values of these firms fail to be reflected by the stock market. Their market valuation is rather based on relative value for both periods before and after the fall of high-tech stocks.

Risk Assessment of Genetically Modified Plants: A Review

The health of genetically engineered foods/plants, which is one of the significant issues has been raised in recent years. Various non-governmental organizations and customers recommended that all GM foods before authorization for human consumption should be subject to long-term animal feed studies. The fundamental purpose of this review is to assess the new potential harmful impact/safety assessment of genetically engineered plants for the use of humans. A balance in the number of research groups, depending on their research, a variety of GM crops (maize and soybeans in particular) are varied as for traditional non-genetically modified plants. It is worth remembering that most of the experiments were carried out in biotechnology firms that sell these GM plants. In this review, we discussed in detail the risk assessment of genetically modified plants.

A new model for investigating the role of IT-based innovation in the pharmaceutical knowledge-sharing attitude

Purpose The creation of partnerships among companies, governments and universities can improve innovation and the technological development of institutions. As innovation is a multidimensional concept, more nuanced research is needed to identify, which dimensions of innovation firms should focus on them. This paper aims to investigate the influence of attitude to knowledge sharing (KS) factors, learning organization and creativity on the innovation in marketing biotechnology firms. So, the purpose of this paper is to examine the influence of learning organization, attitude to KS, creativity, information technology (IT) acceptance, KS culture and trust on the innovation by presenting a new framework and a model. Design/methodology/approach The structural equation modeling technique is used to examine the reliability and validity of the measurement of the provided model. Data were collected by questionnaires. A case study was carried out in 100 marketing biotechnology firms in the Tehran of Iran. In this paper, smart partial least squares 2.0 was used to evaluate the measurement. Findings The result showed that all hypotheses of this research are proved. Also, the results have shown that the attitude to KS, learning organization and creativity affect the innovation in marketing biotechnology firms. As an overall result, the managers should create an enhanced knowledge bank to increase and encourage the KS among employees, thus creating and enhancing innovation in organizations. Also, the results have shown that marketing shortages were mostly connected to access to human resources with related management and marketing experiences and were mainly felt by firms introducing discontinuous novelties. Research limitations/implications The main limitation of this paper is that the sample was retrieved from 384 employees in 100 marketing biotechnology institutions. The larger number of samples can yield better results. Next, even though the respondents’ profiles indicated a high probability of them being cognizant of their organization’s efforts in inter-firm KS, learning, creativity and innovation with three or four respondent from each organization answering all questions for such complicated issues always poses the risk of measurement bias and inaccuracy. An ideal situation for future studies would be to pool and compare multiple respondents from the same organization to obtain a more comprehensive firm-level measurement. In addition, this study only surveyed and sampled biotech marketing companies in Iran. Therefore, the model should be examined using samples from other countries because the varieties of culture could have an impact on employee apprehensions. So, future researchers can test the measurement instrument in different countries and/or conduct large multi-national comparisons. Practical implications Successful marketing strategies depend very much on an organization’s ability to implement them. This paper provides an excellent study about the future of pharmaceutical KS and shows that innovation paths are linked with local and temporary occasions. Also, the results of this study provide valuable information in formulating marketing biotechnology programs. It is essential to study both economics and innovation for students and academics. The results also suggested that policies to increase economic research will also increase innovation. They could contain the consolidation of the legal framework and institutional resources for public organizations to protect intellectual properties. In general, for successful implementation of strategies an organization has to integrate KS, processes and IT. Social implications The paper identifies the most critical factors in the innovation process of enterprizes in marketing biotechnology institutions. The implications derived from this study can shed new light upon policy-making both at the level of governance and in the management practice in Iran’s marketing biotechnology industry. Also, the paper increases understanding of the innovation process in Iran marketing biotechnology companies. This study contributes to innovating management research by offering a set of legal and dependable operational measures. These measures can help academics in theory analysis. Originality/value This is the first attempt examining the role of the learning organization, creativity and attitude to KS as a key contingency factor in innovation in Iran marketing biotechnology firms, an issue whose understanding is still developing in the literature. The paper adds to the body of knowledge by allowing better understanding the attitude toward KS and the influence of KS, learning and creativity on innovation. Previous studies did not investigate the KS in marketing biotechnology firms deeply, but, the present paper permits a more complete view on this topic. The guidelines are provided for the top directors to promote KS and innovation according to the research results. From a managerial point of view some critical elements, which are important for the success of KS and application of these elements for progressing institutional guidelines to develop KS, are considered. Theoretical foundations can be extracted from this study, and these foundations can be implemented to investigate connection in KS elements such as feasibilities processes and institution initiative abilities. So, the results could be suitable to managers when arranging an organization and shaping its culture to improve knowledge management.