Financial Times - Lexiconhttp://lexicon.ft.comTerm of the Day from the Financial Times Lexiconen(PICS-1.1 "http://www.classify.org/safesurf/" L gen true for "http://www.ft.com/" r (SS~~000 1))&copy The Financial Times Ltd 2018 'FT' and 'Financial Times' are trademarks of The Financial Times Ltd. See http://www.ft.com/servicestools/help/terms#legal1 for the terms and conditions of reuse.client.support@ft.comTue, 16 Jun 2009 01:42:55 +0100Fri, 20 Apr 2018 06:45:09 GMTNewspapers15http://lexicon.ft.comhttp://lexicon.ft.comFinancial Timeshttp://im.media.ft.com/m/img/rss/RSS_Default_Image.gifhttp://lexicon.ft.comstrategic alliancehttp://lexicon.ft.com/Term?term=strategic alliance<p>A legal agreement between two distinct organisations that provides for sharing resources collaboratively in pursuit of a mutually beneficial goal.<br /><strong><br /></strong>Strategic alliance agreements are common in the biotechnology sector, where large pharmaceutical organisations sponsor research activities at small, often start-up, research companys.  These small organisations often excel in a particular research discipline, but lack the sales, marketing and distribution resources to bring their innovations to market.</p> <p>Likewise, the large organisations may lack specialised research knowledge in a specific research discipline.  A strategic alliance in this setting may take the following form: the pharmaceutical company sponsors research at the small company by either direct cash payments or through a purchase of equity.  This may be combined with a revenue sharing agreement that allows the small company to receive a fraction of any proceeds arising from commercialised products that use their research output. By forming a strategic alliance, the organisations share resources to their mutual gain.</p> <p><strong>Example</strong></p> <p>The 2009 strategic alliance agreement between Monsanto and GrassRoots Biotechnology is a recent example of an alliance between a large company and small research-focused organisation.  Monsanto is a globally recognised agriculture company.  GrassRoots Biotechnology is a small, research-oriented agricultural biotechnology company.  The Monsanto/ Grassroots strategic alliance agreement called for GrassRoots to conduct research on Monsanto‚Äôs behalf.</p> <p>Strategic alliances also occur in many other business settings.   The strategic alliance between the Dutch airline KLM and the American carrier Northwest Airlines is a famous example of a strategic alliance that allowed two companies to share their routing networks but still remain distinct companies. </p>Mon, 03 Oct 2011 18:41:48 +0100<p>A legal agreement between two distinct organisations that provides for sharing resources collaboratively in pursuit of a mutually beneficial goal.<br /><strong><br /></strong>Strategic alliance agreements are common in the biotechnology sector, where large pharmaceutical organisations sponsor research activities at small, often start-up, research companys.&nbsp; These small organisations often excel in a particular research discipline, but lack the sales, marketing and distribution resources to bring their innovations to market.</p> <p>Likewise, the large organisations may lack specialised research knowledge in a specific research discipline.&nbsp; A strategic alliance in this setting may take the following form: the pharmaceutical company sponsors research at the small company by either direct cash payments or through a purchase of equity.&nbsp; This may be combined with a revenue sharing agreement that allows the small company to receive a fraction of any proceeds arising from commercialised products that use their research output. By forming a strategic alliance, the organisations share resources to their mutual gain.</p> <p><strong>Example</strong></p> <p>The 2009 strategic alliance agreement between Monsanto and GrassRoots Biotechnology is a recent example of an alliance between a large company and small research-focused organisation.&nbsp; Monsanto is a globally recognised agriculture company.&nbsp; GrassRoots Biotechnology is a small, research-oriented agricultural biotechnology company.&nbsp; The Monsanto/ Grassroots strategic alliance agreement called for GrassRoots to conduct research on Monsanto&rsquo;s behalf.</p> <p>Strategic alliances also occur in many other business settings.&nbsp;&nbsp; The strategic alliance between the Dutch airline KLM and the American carrier Northwest Airlines is a famous example of a strategic alliance that allowed two companies to share their routing networks but still remain distinct companies.&nbsp;[ref url=""]David Robinson, Associate Professor in Finance, Duke University&rsquo;s Fuqua School of Business[/ref]</p>