The Evaluation Of Financial Distress And Risk Prevention And Control Countermeasures Of Company H

The pharmaceutical industry is an important part of the national economy in China,and now that China has built a moderately prosperous society,the improvement in living standards and health awareness has led to a gradual increase in demand for healthcare.The pharmaceutical industry is generally characterized by high gross margins,high investment in R&D,and high risk.With the implementation of various medical,pharmaceutical,and medical insurance reform policies in recent years,as well as the development and control of the new pneumonia epidemic and the adjustment of fertility policies,the pharmaceutical industry faces both opportunities and challenges.How to meet the challenges and seize the opportunities is a question that the pharmaceutical industry needs to think about in this context.company H is a listed pharmaceutical company in China’s venture version,which was listed in 2011.It had a good financial performance when it was first listed,but since 2018,it has shown several signs of financial difficulties due to its operations,system reforms,or unexpected events.Although its financial performance improves in 2021 due to various initiatives,there are still more risks.Therefore,this study selects Company H as a specific research object to identify and evaluate its financial distress and propose risk prevention and control measures to cope with challenges and seize opportunities.Based on the review of existing literature and the analysis of Company H’s strategic environment and financial status,the Z-score model and effectiveness coefficient method were used to evaluate the degree of Company H’s financial distress,and then the causes of Company H’s financial distress were analyzed in terms of policy changes,company operations and unexpected events,and finally,risk prevention and control countermeasures were proposed to seize opportunities and cope with challenges.The main findings or recommendations of this study are as follows: First,through the analysis of financial indicators related to the current financial situation of Company H,it is found that Company H has obvious signs of financial distress from 2018 to 2021;Second,the results of evaluating the degree of financial distress of Company H using the Z-score model and the effectiveness coefficient method are consistent and show that the degree of financial distress of Company H gradually increases from 2018 to2020;and Third,the causes of Company H’s financial distress are mainly policy factors such as centralized drug procurement and healthcare system reform,the impact of its own management decisions,and the impact of unexpected events such as the outbreak of the new crown pneumonia epidemic and the criminal detention of its executives;Finally,it can seize the opportunity of policy change by taking advantage of the change in fertility policy,improving the quality of R&D,strengthening end market control and developing new markets.Finally,we can seize the opportunity of policy changes by improving the quality of R&D,strengthening end-market control and developing new markets,improving corporate operations and management by strengthening cost control,inventory,and receivables management,optimizing capital structure,etc.,and responding to the challenges of unexpected events by developing epidemic-related drugs and improving internal control to enhance the ability of risk prevention and control.