Policies to support the internationalisation of latecomer science-based firms: the experience of large Brazilian pharmaceutical companies

Abstract

Purpose This study aims to analyse how different types of public policies have supported the internationalisation of latecomer science-based firms, taking the case of large Brazilian pharmaceutical companies (LBPCs). Design/methodology/approach The methodology comprises a multiple case study and uses a literature review, fieldwork interviews and document analysis of eight LBPCs, five policymakers and three sector experts. Findings Direct and indirect policies differ in supporting LBPCs’ internationalisation motivation. The indirect policies created the necessary conditions to accumulate knowledge and capacity in the domestic market. LBPCs that adhere more to policies supporting production and technological capabilities development are internationalising as an extension of their innovative efforts. In contrast, LBPCs that have built productive capacities and have not yet reached a minimum level of technological capacity go abroad to exploit their production capabilities with the support of direct policies. Originality/value This study contributes to international business and evolutionary literature, demonstrating the channels through which public policies support latecomer science-based firms. The results show that direct and indirect policies assist firms’ internationalisation in different ways, according to actors’ perception: providing support to strengthen their domestic capabilities, which have become competitive advantages in the international market; or offering support to external expansion. It emphasises that industrial policies are relevant to support companies in creating the initial conditions (ownership advantages) to internationalise, and direct policies are important to help companies to design international strategies. This study also debates that policies supporting companies’ internationalisation depend on their adhesion to programmes and incentives and their routines and capabilities, which are specific to each company and lead to different motivations for international expansion.