Analysis Of Enterprise Valuation Based On R&D Investment

Biopharmaceutical industry is a key development field in China.It is not only an important link to promote China’s supply side reform,but also an important part closely related to people’s life and health.China’s biopharmaceutical industry started late.After decades of development,there is still a large gap with the international leading companies.With the increasing demand for biopharmaceutical products,the problems of insufficient independent R & D capacity,lack of key products and insufficient core competitiveness in China’s biopharmaceutical industry have become more and more prominent.It is very urgent for the whole biopharmaceutical industry to enhance the R & D capacity of enterprises.Therefore,the R & D capability will become an important factor to consider the value of enterprises,and the R & D investment intensity is closely related to the R & D capability.Therefore,the potential value brought by enterprise R & D investment is a part that can not be ignored in the value evaluation of Biopharmaceutical Enterprises.However,the research on the value evaluation of Biopharmaceutical Enterprises in China is not rich,and the existing case studies also lack attention to the relationship between R & D investment and enterprise value.A reasonable enterprise value evaluation is particularly important for both managers and investors.Walvax is one of the leading enterprises in China’s biopharmaceutical industry.Walvax attaches importance to R & D investment,has strong R & D capacity and has many important experimental projects.No matter from the industry status or the development potential,Walvax is a leader in the industry and deserves to be studied as an industry representative.Based on the above background,from the perspective of R & D investment,this paper analyzes the operation of Walvax,and chooses FCFF model to evaluate the value of the existing assets of the enterprise.It analyzes the R & D investment of Walvax,explores the potential value that projects under development can bring to the enterprise,evaluates this part of the potential value with the B-S model.And then summarizes the two parts of the value to obtain the overall value of the enterprise.Finally,the rationality of the evaluation results,the practicability of the evaluation model and the impact of R & D investment on enterprise value are analyzed and verified.Through the research,it is found that the R & D investment of Biopharmaceutical Enterprises is of great significance to the improvement of enterprise value.The research projects invested in R & D can bring important potential value to the enterprise,and the R & D investment can internalize the technical resources obtained by enterprise M & A,and further promote the improvement of enterprise value.The traditional single evaluation method has some limitations in evaluating Biopharmaceutical Enterprises.Therefore,it is necessary to introduce the Real Option Method to supplement the potential value.The evaluation results obtained by the combination of FCFF model and B-S model are more in line with the real value of the enterprise.It is reasonable,accurate and scientific.Through the case study of this paper,I hope to provide some reference opinions for enterprise managers and external investors,and also provide new ideas for the value evaluation of Biopharmaceutical Enterprises.