Spinning off Small Companies

Executive Summary

The post-merger cutting room floor creates a great source of new companies and products--it’s good asset management for Big Pharma, and it’s good for medical entrepreneurs. But culturally and structurally, most large companies just can’t go along with the business logic of spin-offs. Technology that does get spun off is most often completely peripheral to the parent’s business--e.g., in vitro diagnostic applications or software and equipment systems from a drug company.