Eastern Europe's pharmaceutical firms trying to cope with funding crisis

Given the latest crisis in Russia and its effects on the region as awhole, pharmaceutical companies in eastern Europe are facing up to the difficulties surrounding health care in that part of the world. The position was considered at the recent third Annual Emerging European Pharmaceuticals and Healthcare Conference held in London, UK, and hosted by Credit Suisse First Boston.

Spencer Jakub, CSFB's director of eastern European research, said that the issues that need addressing in health care are the demographics of the region, inefficient spending, more expensive therapies and what he described as the "catch-up effect." Eastern Europe has a low birth rate and a rising number of pensioners which has led to a funding crisis, Mr Jakub argued. The economic pressures that continue to plague the area are putting a tremendous strain on public health care budgets, though he claimed that this type of spending has to shift away from hospitals and doctors to drugs, as the local populations demand more modern treatments.

Furthermore, he highlighted the need for much more competitive pricing of products and improving their quality. As to how this can be achieved is debatable, but Mr Jakub noted that there will be "a rapid consolidation of drug producers" and these firms will have to look outside the region to create significant revenue growth.