The study examined the effect of financial distress indicators on the share price of pharmaceutical firms in Nigeria. Altman Zeta Score, operating cash flow, and debt-equity ratio were the financial distress indicators used for the study, while the share price was the dependent variable of the study. The study adopted an ex-post-facto research design, covering the period between 2009 and 2018. Secondary data were extracted from the annual reports and accounts of the sampled pharmaceutical firms in Nigeria. Simple fixed-effect regression analysis was used for the panel data analysis. In line with the specific objectives of the study which is to ascertain the effect of Altman Zeta Score, operating cash flow, and debt-equity ratio on the share price of pharmaceutical firms in Nigeria, it was revealed that Altman Zeta Score has a positive and insignificant effect on share price while operating cash flow has a positive and significant effect on the share price. However, the debt-equity ratio has a negative and insignificant effect on the share price of pharmaceutical firms in Nigeria. The study, therefore, recommended that distressed pharmaceutical firms according to the Zeta Score model should improve their management and efficiency of their employees. This is because the failures of these firms are partly caused by poor management of both resources and staff. Means of generating extra cash from operating activities should be vigorously pursued so as to increase the cash these firms generate from the issue of shares, which will help them come out of distress zone. They should reduce the rate at which they use debt to finance their activities. According to Modgliani and Miller (1963), there is a certain point at which further use of debt becomes unfavourable and continuous use of debt will increase both the agency cost and bankruptcy cost which has the implication of reducing the value of the firm leading to the likelihood of financial distress.
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