Research On Risk Control Of X PE In Pharmaceutical Industry

With the rapid development of China's economy,a large amount of wealth has been accumulated by the Chinese residents.The wealth management market has maintained a high compound growth rate all the year round.China's private fund is a new yet fast developing industry with a strong growth trend in terms of the number of funds,the scale in fund-raising and the direction of investment.Pharmaceutical industry is an industry with great demand for technology and capital,and its capital demand is generally characterized by large initial investment,a long cycle and high risks.The aforementioned characteristics—especially the capital demand of the pharmaceutical industry—go against the traditional mode of bank loans but are consistent with the investment preferences of private funds—high risks and high returns.Therefore,in recent years,both the cases and the amount of private equity fund investment in the pharmaceutical industry have increased rapidly.However,the high degree of specialization,the high investment in research and development,and the complexity in enterprise management of the pharmaceutical industry have become both the key points of risk control of private equity fund investment and also the bottleneck of private equity fund investment in pharmaceutical industry.This paper studies the risk control of private equity investment in pharmaceutical industry from both theoretical and empirical perspectives.Based on the theory of enterprise life cycle,risk control is studied according to the characteristics of pharmaceutical enterprises in different development stages.In the theoretical part of this paper,information asymmetry theory is used to explain the causes of risk;the enterprise evaluation theory is used to accurately assess the invested pharmaceutical enterprises,and the risk control theory is used as the theoretical support to construct different risk control systems for different stages of pharmaceutical enterprises.In the empirical research,three pharmaceutical enterprises in their initial stage,growth stage and mature stage invested by X equity investment fund are taken as the research samples;the empirical research on the pre-investment risk identification,the investment terms design and the post-investment risk management of the invested enterprises are carried out respectively based on their risk characteristics of the invested enterprise at different stages.In addition,the effect of the risk control system is evaluated according to the long-term performance of the enterprise after investment.At the end of the paper,the author summarizes the experience of stage-based risk control in the pharmaceutical industry and the developing characteristics of private equity fund and pharmaceutical industry in China and offers some suggestions on the precision and specialization of risk control in the pharmaceutical industry.