The Control of Strategic Alliances : An Empirical Analysis of Biotechnology Collaborations

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 the framework developed by Aghion and Tirole [1994], the allocation of control rights to the smaller party increases with its financial health. The empirical evidence regarding the relationship between control rights and the stage of the project at the time the contract is signed is less consistent with theoretical frameworks