Operating profitability in branded pharmaceutical firms

• Author(s): Charneca, Diogo Fernando Aurélio Semião
• Date: 2013
• Persistent ID: http://hdl.handle.net/10362/11612
• Origin: Repositório Institucional da UNL
• Subject(s): Operating profitability; Ratio analysis; Branded pharmaceuticals; US and Europe
• Document Type: Master thesis
• Language: English
• Advisor(s): Ferreira, Leonor
• Contributor(s): RUN

Description

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Management from the NOVA – School of Business and Economics

This work project focuses in operating profitability of branded pharmaceuticals, measured by return on assets (ROA). It gives insights about key ROA drivers, by breaking down this ratio into gross sales margin, assets turnover and operating risk. Data from consolidated financial statements of 26 US- and European-based firms for the period 2007-2011 is used in univariate and bivariate analyses. Results suggested that firm size and country-membership do not significantly correlate with ROA. However, differences between branded pharmaceuticals’ regions are explored and significant correlations are found between operating profitability and strategic choices variables, namely product portfolio diversification, growth choices and investment.