Global Pharma may leave Russian market due to protectionist policies

The planned imposition of restrictions for the public purchase of imported drugs, initiated by the Russian government, may result in the departure of foreign pharmaceutical companies from the Russian market, local analysts and representatives of foreign drugmakers believe.

The Russian government is considering imposing a ban on the participation of foreign drug producers in the tenders for public procurement of drugs in Russia, in the case of presence in the market at least two similar drugs, produced by local manufacturers. Such an initiative has been recently put forward by Russia’s Ministry of Industry and Trade, in an attempt to support domestic drug producers during the tenders (The Pharma Letter January 10).

In the meantime, this has already caused sharp critics from some leading foreign companies, operating in the Russian market. According to Marina Veldanova, head of Ipsen Russia, these initiatives of the Russian authorities “is jumping over several stages of market development without considering the consequences.” Ms Veldanova added: “We realize the calls of the government to increase localization of production, however this will require at least two to three years and the government should understand this.”