| dc.description.abstract |
Restructuring is an multifaceted phenomenon that involves a wide range of activities
including change in lines of business or change in organizational structure or change in
strategies. When the focus of restructuring shifts from strategic scope to changing the
ownership and capital of the company, it is called financial restructuring. One such
type of restructuring is merger and acquisition. The term merger and acquisition are
distinct words with distinct meanings are considered under the umbrella of corporate
restructuring. Merger and acquisition is one of the most facilitative restructuring
strategies for business organizations aiding synergistic gains, intensifying innovation
and vouching for sustainability. Indian Pharmaceutical sector has been witnessing
drastic changes for over half a century now. The process patent regime created its
standing as a generic drug provider worldwide. Shifting to product patent through
Patents Amendment Act, 2005 brought uncertainties for the domestic companies.
Further, the Drugs (Price Control) order, 2013 brought another major alteration in how
companies were pricing their drugs. Additionally, the pandemic made it apparent and
highlighted the deficiencies and inadequacies of the pharmaceutical sector. The lack of
availability of novel and life-saving drugs questions the credibility and investment in
this industry. Indian pharmaceutical sector is not far behind in proving its inability to
fulfil the sudden surge in demand for drugs. Such realities have pushed companies in
Indian pharmaceutical sector to aggressively engage in merger and acquisition and
create such opportunities to capture the market, improve onshore supply chain
processes, bring disruptive technologies, and ultimately ascertain its impact on the
financial performance in the long run.
Financial analysis is an all-inclusive term that evaluates projects, companies and
other entities to understand their performance and position. It aids in comprehending
liquidity, profitability, efficiency etc. to vouch for the monetary investment made by
the companies. financial analysis is a broad and extensive field that forms a facilitative
tool for the managers as well as other stakeholders to understand the financial health of
the company. The present research uses numerous tools to gauge financial analysis of
companies undergoing merger and acquisition in the Indian Pharmaceutical Sector.
This is done to understand the success or failure of merger and acquisition in the
Indian pharmaceutical sector. The research tries to cover all aspects of financial
analysis starting with a comparative analysis, followed by efficiency analysis. Next
looking at the wealth of the shareholders and finally diagnosing the impact of research
and development on the efficiency and productivity of the companies in a research and
development aggressive sector. No one such conclusion has been drawn for the
generalized impact of merger and acquisition. Hence, it becomes all the more relevant
to focus on merger and acquisition and give a generalized opinion about its impact on
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the Indian pharmaceutical sector.
The research design followed by present research is descriptive cum analytic
research design. Descriptive research in the present research follows comparative and
correlational methods to come to useful results and analytic research design uses facts
and figures already available to analyse and make critical evaluation. The sampling
technique that shall be applied is purposive sampling. The researcher has taken the
data of pharmaceutical companies which are engaged in merger and acquisition. The
research is to be done in recent years and a significant period shall be taken for
justifying research. Further, companies that are listed on National Stock Exchange are
considered as they are conglomerates that represent the Indian Pharmaceutical Sector
as a whole. Twenty two companies that underwent restructuring from 2013 to 2015 are
considered and the data is checked for any missing values for five years pre and five
years post merger and acquisition which are then taken from the annual reports of the
companies.
Conclusively, such breakthrough refinements via merger and acquisition will
facilitate Indian pharmaceutical sector in attaining its ultimate objective of achieving
equitable and sustainable healthcare. This can be augmented by the use of international
partnerships via restructuring that bring novel technologies and one such future
direction is building stronger supply chains through e-pharmacy. The companies in
Indian pharmaceutical sector will be in a position to provide affordable medicines
which are accessible from every corner of the nation through brick-and-mortar stores,
to every individual rich and poor alike. Such research into an industry that is necessary
for human existence will bring necessitated a 360-degree turn-around and regain focus
on cheaper drugs to all. |
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