I'm looking for economic terminology which must exist, although I don't know what it is. (I want to look up articles on a particular situation involving two real-world companies.)
Here is the situation: Company A is developing a diagnostic test which will warn of a particular type of deadly antibiotic resistance. Company B is a pharmaceutical company developing a drug to treat that kind of resistance.
Is there an economic terms that describe concepts relevant to this situation? The important features are that
- Product B will never be bought without product A.
- Customers will only buy A with the intention of possibly buying B.
- Product B will certainly sell at a very high price if product A works perfectly, because A will identify those patients for which B is life-saving. A deserves some of this return, but the many customers buying A each will have only a low-probability of being one of the few to benefit.
Similarly, one could imagine a related case that there are exactly two bicycle wheel manufacturers, and by law A can only sell front wheels and B can only sell back wheels. There will be some sort of odd price hostility between A and B, because the two products are each useless without the other. The natural thing to happen is for A and B to merge, although wrangling about the terms of a merger may make this impossible.
In my real-world case the cognizant shareholders of A should oppose any buyout by B at anywhere near current market prices, because A's technology will extend to many many other applications.