The influence of a firm's capability and dyadic relationship of the knowledge base on ambidextrous innovation in biopharmaceutical M&As

In recent years, technological mergers and acquisitions (M&As) have become important strategic tools for enterprises to access and utilize new external knowledge. In particular, in the biopharmaceutical industry, M&A activities are actively being progressed due to an increase in new drug development costs, a decrease in R&D productivity, and the patent expiration of blockbuster drugs. However, there is a lack of research on the integrated view of (1) the acquirer's capability and (2) the dyadic relationship of the knowledge base between the acquirer and target on the innovation performance of the acquirer. Furthermore, there are few empirical studies on the impact of these factors on ambidextrous innovation; that is, exploitative and explorative innovation. Therefore, with this integrated view in mind, this study analyzed the effect of each factor on the exploitative and exploratory innovation performance of the acquirer. A negative binomial regression was conducted using patent data to measure the innovation outcome of the acquirer after M&A. The findings suggest that (1) the acquisition experience of the acquirer and (2) the technological commonness between the acquirer and the target both had a significant impact on the exploitation and exploration innovation performance.