Efficiency Analysis of Indian Pharmaceutical MSMEs: A Post-COVID Era

Varun Mahajan ()
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Varun Mahajan: Indian Institute of Management Tiruchirappalli

A chapter in Advances in the Theory and Practice of Data Envelopment Analysis, 2025, pp 449-459 from Springer

Abstract: Abstract Indian pharmaceuticals, mainly led by Micro, Small and Medium Enterprises (MSMEs), play a critical role in the global health environment and constitute a major presence in the generic medicine and vaccine segments. It has thrown open severe vulnerabilities within these very enterprises but has also made them indispensable for riding on the escalating global demand surges. Data envelopment analysis (DEA) has been applied to study this pandemic in relation to the operational efficiency of Indian MSMEs in the pharmaceutical industry based on a sample of 399 firms. The DEA efficiency scores show that most of the firms under study have a high degree of inefficiency and are influenced majorly by the resource allocation of different firms, scale of production, and production techniques. The results indicate that micro-firms have been uniformly trending upward toward higher levels of efficiency than small and medium-sized firms, for which support systems could be administered to ensure the efficient oversight of overhead costs, regulatory compliance, and innovation. Further, the results show that adequate resource management and governmental support can make these firms more resilient and competitive. The paper advances insights that can give adequate policy guidance to policymakers and industry stakeholders on how the Indian pharmaceutical MSMEs could be enhanced in their future competitiveness.

Keywords: MSMEs; DEA; Efficiency; Pharmaceutical industry; India (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/978-3-031-98177-7_30

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