In order to develop the next generation of risky products, ALZA, a mature and profitable biotechnology company specializing in drug delivery systems must raise $ 40 million. Organizational difficulties and challenges of competition require that the work was done within the firm. However, accounting considerations and concerns about shareholder reaction to the introduction of new risks for a firm lead director general considered off balance sheet financing for the new venture. To finance the new venture, the company creates a new car financing: a unit, consisting of the called common stock plus warrants. This case is the general director of the leading solution to the issue of units and the creation of new research and development subsidiary. "Hide
by Josh Lerner, Peter Tufano Source: Harvard Business School 29 pages. Publication Date: April 6, 1993. Prod. #: 293124-PDF-ENG
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