Diversity management of patents in M&A - a case of Japanese pharmaceutical firms

Abstract

The purpose of this study is to propose an analysis of pharmaceutical effect areas of patent data as output of research and development (R&D) activities and as resources of the firm in mergers and acquisitions (M&A). We used two M&A cases of Japanese pharmaceutical firms of the partners with different technology relatedness. It is demonstrated that M&A had a negative effect on the R&D activities of the consolidated firm of technologically heterogeneous partners. The results also show that there are no increases in the proportion of patents with the most diversified effect areas in M&A of technologically heterogeneous partners and there is an increase in another M&A of technologically homogeneous partners. It is advisable that the partner firms cooperate to manage their patents in order to maintain patents in diversified areas rather than managing their patents more diversified as a whole, in order not to have a negative effect.