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Analysis and Evolution of Profitability in the Pharmaceutical Field in Romania

In: International Conference Innovative Business Management & Global Entrepreneurship (IBMAGE 2020)

Author

Listed:
  • Izabela Diana Hada

    (Ph.D. Student, „1 Decembrie 1918†University of Alba Iulia, România)

Abstract
The pharmaceutical industry is an important field of activity that contributes to the diagnosis, treatment, maintenance of the health of the population. The need of pharmaceuticals has led to an increase in both the number of drug manufacturers and the number of distributors. A significant part of the specialized studies deals with the problem of the profitability of the pharmaceutical industry. The study of the financial performance of the economic entities in the pharmaceutical field in Romania is a necessary concern in the conditions of a progressive annual increase of the profitability of this sector. The main purpose of this paper is the analysis and presentation of the evolution of profitability indicators (return on assets, return on capital, return on sales) as part of the activity of assessing the financial performance of economic entities operating in Romania in the pharmaceutical industry (manufacturing of basic pharmaceutical products - CAEN code 2110). Profitability indicators were analyzed for a number of 46 entities in the pharmaceutical industry in Romania for a period of 20 years (1999-2018). We are talking in this case about a turnover of 1.1 Billion lei (249.2 million euros), a number of employees of 3,098 employees, a profit of 135.2 million lei (30.7 million euros) - representing 0.12% of the net profit made in Romania. The research results show that in the period 2008-2009, the financial crisis left a strong mark on the evolution of profitability in the pharmaceutical industry. However, during the 20 years we talk about a positive evolution, in the sense of increasing the profitability of this field, which justifies the increase in the consumption of pharmaceuticals products.

Suggested Citation

  • Izabela Diana Hada, 2020. "Analysis and Evolution of Profitability in the Pharmaceutical Field in Romania," Book chapters-LUMEN Proceedings, in: Marcin Waldemar STANIEWSKI & Valentina VASILE & Adriana Grigorescu (ed.), International Conference Innovative Business Management & Global Entrepreneurship (IBMAGE 2020), edition 1, volume 14, chapter 55, pages 744-757, Editura Lumen.
    • Handle: RePEc:lum:prchap:14-55
    DOI: https://doi.org/10.18662/lumproc/ibmage2020/55
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    References listed on IDEAS

    as
    1. Izabela Diana Hada, 2020. "Considerations Regarding the Assessment and Measurement of Financial Performance," Book chapters-LUMEN Proceedings, in: Carmen NÄ‚STASE (ed.), 16th Economic International Conference NCOE 4.0 2020, edition 1, volume 13, chapter 11, pages 115-129, Editura Lumen.
    2. Paliu-Popa Lucia & Cosneanu Lavinia, 2011. "Profit and loss account in the international context," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 2, pages 18-25, May.
    3. Ana CARP & Maria MIREA, 2017. "Profitability As The Form Of Communication Of The Value Of An Entity That Works For Profit," Romanian Statistical Review Supplement, Romanian Statistical Review, vol. 65(6), pages 192-199, June.
    4. Florina-Adriana STĂNICĂ & Adina Ionela STRĂCHINARU & Vasile ILIE, 2015. "Influences on the profitability of the pharmaceutical industry in Romania," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(Special(I), pages 97-105.
    Full references (including those not matched with items on IDEAS)

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    1. Izabela Diana Hada & Mihaela Maria Mihalcea, 2020. "Analysis and Evolution of Profit and Net Profit Margin in the Pharmaceutical Industry in Romania," Book chapters-LUMEN Proceedings, in: Marcin Waldemar STANIEWSKI & Valentina VASILE & Adriana Grigorescu (ed.), International Conference Innovative Business Management & Global Entrepreneurship (IBMAGE 2020), edition 1, volume 14, chapter 6, pages 70-81, Editura Lumen.
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    3. HADA Izabela Diana & MIHALCEA Mihaela Maria, 2020. "The Importance Of Profitability Indicators In Assessing The Financial Performance Of Economic Entities," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 219-228, July.

    More about this item

    Keywords

    financial performance; ROA; ROE; return on sales (ROS); pharmaceutical field;
    All these keywords.

    JEL classification:

    • F2 - International Economics - - International Factor Movements and International Business
    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics

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