Knowledge capital in biotechnology industry: impacts on Canadian firm performance

Abstract

Knowledge has become the main driver of economic growth. This is true both at the level of the macro-economy, where emerging countries make efforts to capture knowledge from more advanced countries and at the level of the firm, as companies make efforts to acquire complementary knowledge from other firms. The specific types of knowledge associated with performance differ from one industry to another, and on company maturity. A number of studies demonstrated that biotechnology performance and the geographical concentration of US firms are related to the recruitment of star researchers. This paper confirms these results for Canadian companies and goes further in accounting for the specific roles played by these highly productive university researchers and their impact on the performance of biotechnology enterprises. This discovery points to a new stage in the birth of biotechnology companies, and is associated with the selection of venture capitalists and major pharmaceutical companies who finance these specialised biotechnology firms.