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ИД «Финансы и кредит»






Finance and Credit

Assessing the value determinants of biotechnology sector firms

Vol. 29, Iss. 1, JANUARY 2023

Received: 28 November 2022

Received in revised form: 12 December 2022

Accepted: 26 December 2022

Available online: 30 January 2023

Subject Heading: BUSINESS VALUE

JEL Classification: C51, C52, L65

Pages: 60–79


Tat'yana Yu. KUDRYAVTSEVA Higher School of Engineering and Economics, Peter the Great St. Petersburg Polytechnic University, St. Petersburg, Russian Federation


Angi E. SKHVEDIANI Higher School of Engineering and Economics, Institute of Industrial Management Economics and Trade, Peter the Great St. Petersburg Polytechnic University, St. Petersburg, Russian Federation


Oksana P. BAL'CHUGOVA Higher School of Engineering and Economics, Institute of Industrial Management of Economics and Trade, Peter the Great St. Petersburg Polytechnic University, St. Petersburg, Russian Federation

ORCID id: not available

Subject. This paper examines the relationship between financial indicators and the value of 1054 biotech firms in the period from 2011 to 2020.
Objectives. The aim is to build a model, using the econometric analysis, and on its basis to assess the impact of financial factors on the value of companies operating in the biotechnology industry.
Methods. The study consists of several stages. At the first stage, we scrutinized the existing materials on the topic and selected factors for constructing an econometric model. At the second stage, we performed a regression analysis and tested the resulting model according to the prerequisites of the least squares method. At the last stage, we selected the optimal model based on tests for the specification of the model, and interpreted the results.
Results. We established that the costs of research activities, return on equity are positively and significantly related to the cost, while the coefficient of financial dependence significantly negatively affects the value of companies. Revenue growth and dividend yield are not significant in the case of biotech companies.
Conclusions. For the biotech sector companies, the coefficient of financial dependence, on the average in the sample, is very important. This suggests that most biotech companies are at the stage of growth. With a decrease in the coefficient of financial dependence, there is an increase in own funds, which undoubtedly has a positive effect on the value of biotech companies.

Keywords: company value, biotechnology, market value, panel regression, regression analysis


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