Russian pharma industry: 2017 results
The past year has not been a landmark for the pharma industry, however, it has been quite eventful in terms of the events directly affecting the industry. A traditional annual review by PharmVestnik covers drug marking, pricing, interchangeability, GMP, preferences, pharmacy practices, patent litigations etc.
[PharmVestnik # 02, 16/01/2018, p. 1, cont’d pp. 4-6]
// Medical Manufacturing
What the new state support measures would mean for Russian stent and catheter manufacturers
In early December 2017, another regulation setting forth preferences for local manufacturers of a specific medical device group was adopted. On the back of the ongoing disputes on the benefits and hazards of the “odd-man-out” mechanism, a “second-man-out” regulation has come into force having raised even more barriers for foreign manufacturers willing to enter the Russian hospital market. PharmVestnik explores the effects of this regulation for market players and patients.
[PharmVestnik # 02, 16/01/2018, p. 4]
// Budgets & Funding
Experts seek to set health budget priorities
On the back of chronic underfunding of the Russian healthcare, experts raise a question about top priorities in funding that would yield a maximum long-term effect, and would designate the areas not to save on. This topic was on the agenda of the recent conference on health system funding Finzdrav’2017 that discussed the 2018 health budget.
[PharmVestnik # 02, 16/01/2018, p. 7]
// Budgets & Funding
In 2018, the bulk of Pharma-2020 budget will be earmarked for state-supported projects
In late December 2017, the government made the 4th revision of the state program “The Development of Pharmaceutical and Medical Industry in 2013—2020”. Within the framework of funding the pharma subprogram in 2018, the emphasis was made on state projects, with 3.55B RUB earmarked for this purpose. At the same time, down the line, basically all funds will be spent on subsidizing pharma companies, both private and public.
[PharmVestnik # 02, 16/01/2018, p. 8]
// Patient Advocacy
Patient advocates ask for money for free drug coverage
For 2018, the Federal Mandatory Health Insurance (MHI) Fund has a peak budget of 1.888 trillion RUB. Besides, this budget is to grow to 2.139 trillion RUB by 2020. The fund managers believe that this money will be sufficient to provide for a stable development of the MHI structural units. But it looks like this money is not enough to make headway in drug reimbursement.
[PharmVestnik # 02, 16/01/2018, p. 9]
// Health IT
Neither medicine nor pharma can develop without a strategic approach to big data
On 20 December 2017, the participants of the meeting covering digital health development in Russia lead by Herman Klimenko attempted at looking into the year 2018. According to their estimates, not does the Russian digital health segment have a huge growth potential only; it also faces acquisition threats from its so-called “partners”. Most of all, the segment needs big data systematization and regulation.
[PharmVestnik # 02, 16/01/2018, p. 11]
// Pharma Industry – General
Pharma industry is recommended to define its development vector on its own
Experts believe that most problems that block the pharma industry development are a result of diametrically opposed interests of the market players, and uncoordinated actions of the core agencies. Pharma businesses fear the regulators’ unpredictability, while the government is not happy about the pharma’s inclination to discuss burning issues proceeding solely from economic aspects. In the absence of a uniform state regulator, the only way out is to let the market players choose an optimum development path on their own. Such approach was suddenly proposed by David Melik-Guseynov, Director of Moscow Research Institute for Health Management, speaking at the December meeting of the Russian Association of Pharmaceutical Marketing.
[PharmVestnik # 02, 16/01/2018, pp. 14-15]
// Insight – Procurement
Drug Procurement Report, Q317
The approaching March, which is the time of the Presidential election in Russia, makes the government procurement segment increasingly more important. An adequate drug coverage of the population under the state-funded programs is one of the most efficient ways to mitigate social strain. Therefore, it is difficult to explain the cut of the drug procurement budget in Q317. At the same time, there are players who have demonstrated a manifold drug sales growth in the state procurement segment even given the falling market.
[PharmVestnik # 02, 16/01/2018, pp. 18-19]
A growing number of pharmacies launch product ranges as their private labels
A private label is one of high-margin business lines for pharmacies. For this product category, an average markup ranges between 30 and 70%. Managers of state and municipal pharmacy chains are sure that well-known brands may significantly boost their revenues if sold under private labels.
[PharmVestnik # 02, 16/01/2018, p. 20]
// Health Management
Economic aspects of cancer treatment discussed
The lead St. Petersburg oncologists have joined the Expert Board of the Innovation Economics in Oncology project pursued by the Center for Health Economics and Management of Moscow Skolkovo Management School. On the New Year eve, Center Director Yury Krestinsky held a working meeting with experts.
[PharmVestnik # 02, 16/01/2018, p. 21]
// Pharma Retailing
Ural pharmacy chains go through hard times
ASNA Pharmacy Association summed up the 2017 results of operating in the Ural Federal District of Russia. According to the Association, the number of partner pharmacies has doubled over the past year. However, Evgeny MALTSEV, ASNA territory manager (the Urals and Siberia), believes that reginal pharmacy chains will face more difficulties in 2018.
[PharmVestnik # 02, 16/01/2018, p. 21]