How to internationalize in biotechnology: the case of Turkish biotech firms

Abstract

This study attempts to understand how biotechnology firms in a developing country engage in international operations to commercialize their knowledge. In order to understand the internationalization of biotech firms, two dominant theories, the process theory of internalization and the new venture internationalization theory, are utilized to assess the degree of internationalization. The analysis is based on interviews done with managers/founders of 40 Turkish biotechnology firms. The results show that the new venture internationalization theory helps to observe the role of networks and strategy in pursing internationalization, even though this is not necessarily connected with the timing of internationalization. Technological capability affects internationalization, albeit negatively, indicating that biotechnology firms in developing countries do not compete with their research and technologies. Size as an indicator of the firm's resources shows a high influence on internationalization, confirming the impact of the process theory argument with a slight modification: the critical mass of resources need to accumulate before internationalization takes place and this might not happen necessarily with time. The type of internationalization might show a wide range, from simple trading to integrated research and production. The study shows that Turkish biotechnology firms are mainly traders, with a few exceptionally born global firms practicing complicated set of activities at the international level. Thus, considering the level of internationalization enriches the understanding of how internationalization takes place.