Economic Liberalization and Pharmaceutical Sector in India: Risk Identification and its Assessment

The pharmaceutical sector is unlike other sectors as aim of this sector is public welfare, profit and revenue. The global pharmaceutical industry is undergoing rapid transformation, as the pharmaceutical companies are facing pressure from governments and public for reduction in prices of life saving drugs and initiating outcome based pricing. India's pharmaceutical industry has been growing at record levels for the past ten years, even though the sector has a very huge potential to grow, for a year it has been facing major losses as there is a dip in investments due to various changes happening in the sector. The Indian pharmaceutical industry's deep-rooted position as a global leader in the production of high-quality generic medicines is set to harvest significant new benefits as the patents on a number of blockbusters drugs are about to expire over the next few years. In this study, the authors want to dwell upon the identification and assessment of various risks involved in pharmaceutical sector. Various risks involved in the pharmaceutical sector which lead to fall in investments and how the existing risks (internal and external) impact investment in this area are analyzed using factor analysis and tornado chart.