Strategies and performance of Canadian biotechnology firms: an empirical investigation

Abstract

A survey of Canadian biotechnology firms investigated the impact of their context on their strategies and performance. This paper reports two kinds of exploratory findings: a descriptive profile of the companies and their strategies for coping with business and political contexts, and statistical comparisons between three performance groups. Three aspects of the firms' business context were highlighted: high cost of product development, scarcity of capital, and lack of qualified people, especially managers. Although the firms tried to alleviate the cost and capital problems by engaging in collaborative alliances, small size, private ownership and the human resource problem indicated barriers to commercial success. Firms also perceived government action or inaction in the political context as a major obstacle, which they tried to overcome through various influence tactics. When firms in three performance groups were compared, the main differentiators between higher and lower performers were development of complementary skills outside R&D, and effective transfer of organizational learning. Implications for managers and further research are discussed.