February 12, 2024Managerial and Decision EconomicsOpen Access

To merge or not to merge? The impact of mergers and acquisitions on corporate success in the pharmaceutical industry

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Authors

MBMelanie BüssgenUniversität Hamburg TSTom StargardtUniversität Hamburg

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Implication

Difference-in-differences analysis demonstrates increased revenue and profits after mergers in top pharmaceutical firms, indicating growth without short-term innovation gains.

Key Points

Substantial mergers and acquisitions significantly expand pharmaceutical revenue and profitability, whereas organic growth alone yields comparatively slower corporate expansion.
Postmerger net profit grew by 6.82 billion USD in the first year alongside an annual revenue rise of 3.50 billion USD, outperforming companies relying on organic growth.
Analysis using a generalised difference-in-difference design across top drugmakers reveals higher market dominance, highlighting no short-term gains in research and development.

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Büssgen et al. (2024) studied this question.

synapsesocial.com/papers/68e796e3b6db643587707fac https://doi.org/10.1002/mde.4129

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Implication

Difference-in-differences analysis demonstrates increased revenue and profits after mergers in top pharmaceutical firms, indicating growth without short-term innovation gains.

To merge or not to merge? The impact of mergers and acquisitions on corporate success in the pharmaceutical industry

Discussion

Member takes

Implication

Key Points

Cite This Study

To merge or not to merge? The impact of mergers and acquisitions on corporate success in the pharmaceutical industry

Discussion

Member takes

Implication

Key Points

Cite This Study

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