QUESTION 4: Post-acquisition, OldPharma believes that it will be necessary to consolidate all biologicals R&D into one center. There are two logical choices: OldPharma's existing headquarters in Germany, and Biofuture's current headquarters in San Francisco. OldPharma does not have any current biologicals facilities or operations in Germany, so new facilities would have to be built. How would you think about this decision?
Reveal answer
A very good answer would include the following:
Reasons for consolidating at OldPharma's corporate HQ in Germany.
- Better coordination with non-biologicals R&D at OldPharma
- Better coordination with other business units of OldPharma (e.g., marketing, manufacturing)
- Easier to intermix scientists in biologicals and traditional R&D units, and transfer any unique capabilities & knowledge
- Overall easier to integrate BioFuture's R&D capabilities into OldPharma
Reasons for consolidating in BioFuture's San Francisco location.
- Less likely to see flight of talent: many top scientists would likely leave rather than relocate to Germany
- Easier to recruit and find top research talent in San Francisco vs. Germany
- Easier to retain the entrepreneurial spirit and culture of BioFuture
- No need to rebuild e.g. manufacturing plants, research facilities