[NVS knows what it's doing with its latest investment. China & India have been the flavors of the decade because of fears of political instability in Russia, but that's going to change in pharma and other sectors.]
Russia accounts for just under a third of the total Central & Eastern European pharmaceutical market, due to its population of 141 million; however, in per capita terms, Russia is also one of the smallest markets, comparing to Romania. The Russian pharmaceutical market is predicted to expand at a relatively high CAGR in US dollar terms over the next few years and will continue to be driven by import growth; a heavy reliance on imports has resulted from the lack of locally-manufactured innovative pharmaceuticals. Over the last few years, import growth has been boosted by the federal drug supply system (DLO). Around 80% of DLO funds are spent on imported pharmaceuticals.
In January 2005, the federal drug supply system, or the DLO, came into force, replacing a number of subsidies previously available to the vulnerable population. Under the DLO, free medicines are provided to people receiving state benefits or who are hospitalised. In June 2008, the Health Minister, Tatiana Golikova, and the Prime Minister, Vladimir Putin, discussed the future of the DLO; Putin announced that the health sector would be reformed in 2010, with the DLO being replaced by a system of compulsory health insurance. [Sound familiar?]The new system will provide free or low-cost prescription drugs to all Russians. It has been reported that only Russian-produced drugs will be subsidised under the new arrangements. The new system has been postponed, however, due to a number of factors, including the economic crisis.
The market is dominated by generic products. Over the last decade, there has been a shift in demand from cheap locally produced generics to more expensive branded generics of foreign origin. Branded generics are popular for historical reasons. They were practically the only pharmaceuticals available in the former USSR and both patients and doctors remain loyal to well-established brands. Furthermore, the traditionally high level of self-medication within the population has encouraged companies to produce pharmaceuticals with recognisable names. However, generics may eventually lose market share to branded pharmaceuticals if the government’s plan to vastly increase the number of locally manufactured innovative drugs is successful. A strategy for encouraging growth in the local pharmaceutical industry for the period up to 2020 envisages the government helping local producers to cover the costs of the R&D that is required to boost production of innovative pharmaceuticals.
News 
Market Data 
Discover 
