Cross-Border Mergers & Acquisitions and Business Growth in Healthcare: An absorptive capacity perspective - Confab 360 Degree Annual Conference in Dubai, 2025

Abstract

Objective: This study explores the impact of cross-border mergers and acquisitions (M&As) on the business growth of pharmaceutical companies. Based on evidence from the 2015 acquisition of Novartis's vaccine division by GlaxoSmithKline (GSK) as a paradigmatic case study, we also explore how this M&A led to business growth during the COVID-19 pandemic.

Design: We employ qualitative analysis of 10 years of executive reports, annual reports, market research, and peer-reviewed journal articles from Business Source Premier. Then, we developed a thematic analysis of this secondary data based on five critical dimensions of post-merger success, including strategic rationale, after-acquisition growth, operational synergies, cultural integration, and competitive positioning.

Results: Our findings suggest that the acquisition’s success was fundamentally driven by its tight strategic alignment with GSK's long-term objectives of specialising in vaccines and innovative healthcare. Operational efficiencies were achieved through phased integration, while proactive leadership and open communication were found to be crucial in reducing cultural challenges.

Conclusions: We conclude that in the intricate healthcare ecosystem, carefully planned and executed M&As that prioritise cultural alignment in addition to financial and operational objectives can result in substantial, long-term value. For executives, academics, and policymakers navigating international M&A strategy in the healthcare industry, the paper offers insightful theoretical analysis and useful recommendations.