In finance, a poison pill, sometimes euphemistically called a "shareholder rights plan," is a mechanism designed to prevent a hostile takeover of the company by outside investors. There are a variety of mechanisms used, but all have the effect of either making the company less attractive as a takeover target, increasing the cost of the takeover, or both.
For example, when an outside investor's ownership of the target company passes a certain threshold, perhaps something like 30 percent of shares outstanding, a poison pill might be triggered whereby all other shareholders might have the option to purchase shares in the target company at a reduced price. This dilutes the shareholdings of the party attempting the takeover, and makes the takeover more expensive.