Professional Documents
Culture Documents
By
Aayushi Tomar
TABLE OF CONTENTS
CHAPTER 1
SECTION 1.1
Subsection 1.1.a
Subsection 1.1.b
Subsection 1.1.c
SECTION 1.2
SECTION 1.3
CHAPTER 2
SECTION 2.1
SECTION 2.2
Subsection 2.2.a
Subsection 2.2.b
Subsection 2.2.c
SECTION 2.3
CHAPTER 3
SECTION 3.1
SECTION 3.2
SECTION 3.3
Subsection 3.3.a
Subsection 3.3.b
Subsection 3.3.c
NLL has transformed itself from being a small Domestic API player to one of the most
integrated player in the Global Cephalosporin Industry within Anti Infective Therapeutic
segment. NLL currently has a strong hold of API & Formulation business in almost 70
countries of the world. with 11 State of Art manufacturing facilities spread across the States
of Punjab and Himachal Pradesh with compliance to global standards of cGMP, Environment
Health Safety (EHS) as well as pool of thousands of highly skilled, knowledgeable,
competent qualified work force at all levels.
Growth through human capital is the principal underlying driver of NLL’s success in past as
well as in the future with global economy undergoing rapid changes driven by Pharma
emerging markets like India, China, Korea, Brazil, South Africa, Russia just to name a few.
NLL has a very sharp focus on these exciting rapidly expanding economies.
Human suffering alleviation at affordable costs will continue to drive both developed &
developing nations in terms of greater access to medication NLL is committed to play its role
in making this happen in best possible way. We invite you to be a part of us whilst we
nurture, enrich & care to contribute our bit to the society at large by way of small
contribution in our own way to give back to the society what we’ve taken from it.
With leading global capacity for some of the Cephalosporin Molecules, NLL is one of the
leading manufacturers of Cephalosporin range of products possessing core strength in
Manufacturing (Both oral and Sterile API’s) and one of the few companies in India
possessing both Lyophilisation and Crystallization facilities.
NLL offers highest standards of CGMP to satisfy both EU and USFDA requirements.
Production is carried out in discrete production units, each unit coupled to a dedicated fully
isolated finishing suite. NLL strictly maintains Total Quality System (TQS) controls
throughout the entire production cycle from raw materials through to packaging and dispatch.
Glass lined, stainless steel and MSGL reaction are configured for multi-product synthesis at
the 500kg to multi tone scale of operations. Purified water is used throughout the site.
Solids separation and drying is carried out in a range of tray ovens, stainless steel vacuum
blender driers and stainless steel pressure filters/driers
All the API & Intermediate manufacturing sites are fully compliance with International
environmental regulations
Currently NLL ‘s API business explores one of the most stringent markets of the world like
EU, Mexico, LATAM, SEA, CIS etc besides overall exports to over 70 countries of the
world.
What is an API?
The Active Pharmaceutical Ingredient (API) is the part of any drug that produces the intended
effects. Some drugs, such as combination therapies, have multiple active ingredients to treat
different symptoms or act in different ways.
Production of APIs has traditionally been done by the pharmaceutical companies themselves
in their home countries. But in recent years many corporations have opted to send
manufacturing overseas to cut costs. This has caused significant changes to how these drugs
are regulated, with more rigorous guidelines and inspections put into place.
All drugs are made up of two core components: the API, which is the central ingredient, and
the excipient, the substances other than the drug that helps deliver the medication to your
system. Excipients are chemically inactive substances, such as lactose or mineral oil in the
pill.
Manufacturers use certain standards to determine how strong the API is in each drug.
However, the standard can vary widely from one brand to another. Each brand might use
different test methods, that can result in different potencies.
In all cases, manufacturers are required by the FDA to prove the potency of their products in
real-life patients, as well as in laboratory conditions.
Cephalosporin
What are Cephalosporins?
Cephalosporins are a type of antibiotic. Antibiotics are medications that treat bacterial
infections. There are many types, often called classes, of antibiotics available.
Cephalosporins are a type of beta-lactam antibiotic.
They can be taken orally or injected into a vein (intravenous injection), depending on the
infection.
Oral cephalosporins are generally used for simple infections that are easy to treat. For
example, a routine case of strep throat might be treated with a course of oral cephalosporins.
Intravenous (IV) cephalosporins are used for more severe infections. This is because IV
antibiotics reach your tissues faster, which can make a big difference if you have a serious
infection, such as meningitis.
Cephalosporins are grouped together based on the type of bacteria that they’re most effective
against. These groups are referred to as generations. There are five generations of
cephalosporins.
Gram-positive bacteria have thicker membranes that are easier to penetrate. Think
of their cell wall as a chunky, loose-knit sweater.
Gram-negative bacteria have thinner membranes that are harder to penetrate,
making them more resistant to some antibiotics. Think of their wall as a piece of fine
chain mail.
First-generation Cephalosporins
First-generation cephalosporins are very effective against Gram-positive bacteria. But they’re
only somewhat effective against Gram-negative bacteria.
First-generation cephalosporins might be used to treat:
cephalexin (Keflex)
cefadroxil (Duricef)
cephradine (Velosef)
Second-generation Cephalosporins
ear infections
sinus infections
UTIs
gonorrhoea
meningitis
sepsis
Third-generation Cephalosporins
The third generation also tend to be less active than previous generations against Gram-
positive bacteria.
cefixime (Suprax)
ceftibuten (Cedax)
cefpodoxime (Vantin)
Fourth-generation Cephalosporins
Fifth-generation Cephalosporins
This cephalosporin can be used to treat bacteria, including resistant Staphylococcus aureus
(MRSA) and Streptococcus species, that are resistant to penicillin antibiotics.
Cefixime Trihydrate
Cefuroxime Axetil (Amorphous)
Cefpodoxime Proxetil
Cefdinir
Ceftriaxone Sodium (Sterile)
Cefotaxime Sodium (Sterile)
Cefuroxime Sodium (Sterile)
Ceftazidime (Buffered)
Cefepime HCl (Buffered)
Cefepime HCl (Unbuffered)
Cephalothin (Buffered)
Cefazolin Sodium (Sterile)
Cefprozil
Cefoperzone Sodium (Sterile)
Cefpirome Sulphate (Buffered)
Cefoxitin Sodium (Sterile)
India’s population is growing rapidly, as is its economy – creating a large middle class with
the resources to afford Western medicines. Further, India’s epidemiological profile is
changing, so demand is likely to increase for drugs for cardio-vascular problems, disorders of
the central nervous system and other chronic diseases. Together these factors mean that India
represents a promising potential market for global pharmaceutical manufacturers. More than
that, India has a growing pharmaceutical industry of its own. It is likely to become a
competitor of global pharma in some key areas, and a potential partner in others. India has
considerable manufacturing expertise; Indian companies are among the world leaders in the
production of generics and vaccines. As both of these areas become more important, Indian
producers are likely to take a large role on the world stage – and potentially partner with
global pharma companies to market their wares outside of India.
Further, healthcare has become one of the key priorities of the Indian Government and it has
launched new policies and programmes to boost local access and affordability to quality
healthcare.
Cephalosporins Market
There are nine member states of the Commonwealth of Independet States. These CIS states
are: Armenia, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan,
and Uzbekistan. This organization promotes cooperation across the member states in
economics, military, and political aspects. The organization also has some power over trade,
finance, security, and making laws. The nations also cooperate in preventing cross-border
crime.
The CIS, which is also known as the Russian Commonwealth, was first created in 1922
through the Treaty and Declaration of the Creation of the USSR. The signing of the
Belavezha Accords in 1991 dissolved the Soviet Union and replaced it with the CIS.
The CIS oversees three different organizations: The Eurasian Economic Union, the Union
State, and the Collective Security Treaty Organization. In 20212, eight of the nine members
signed on to participate in the CIS Free Trade Area.
The total region has an area of over 8 million square miles and a population of nearly 240
million people.
Belarus, Kazakhstan, Kyrgyzstan, Armenia, Russia, and Uzbekistan were the founding
member states.
Turkmenistan is an associate member state. It signed the agreement to join the CIS in 1991
but has not ratified the charter. Though it was a founding member, it has never been a full
member and was designated as an associate member state in 2005.
Russia
Russia , or the Russian Federation, is a transcontinental country located in Eastern Europe
and Northern Asia. Covering an area of 17,125,200 square kilometres it is the largest country
in the world by area, spanning more than one-eighth of the Earth's inhabited land area,
stretching eleven time zones, and bordering 16 sovereign nations. In 2016 the
pharmaceutical market grew by 6.7 percent in ruble terms while remaining
unchanged from 2015 in unit terms. In 2016 pharmaceutical price inflation was 5
percent. The share of local medicines grew by 1.2 pp in monetary terms. The Russian
market is ranked 14th in the world in terms of size. In Russia pharmaceutical output
increased by 23.8 percent to RUB 286 billion while medical product output grew by
15 percent to RUB 52.8 billion. The post-Soviet countries remain the major export
markets for Russian medicines, accounting for 86 percent of the total exports.
In 2016 the pharmaceutical market grew by 6.7 percent in ruble terms while remaining
unchanged from 2015 in unit terms. In 2016 pharmaceutical price inflation was 5 percent.
The share of local medicines grew by 1.2 pp in monetary terms. The Russian market is
ranked 14th in the world in
terms of size. In Russia pharmaceutical output increased by 23.8 percent to RUB 286 billion
while medical product output grew by 15 percent to RUB 52.8 billion. In 2016 almost 80
percent of imports came from Europe, primarily from France and Germany.
The post-Soviet countries remain the major export markets for Russian medicines, accounting
for 86 percent of the total exports.
Market size
Trend
The year 2016 saw the Russian pharmaceutical market grow by 6.7 percent in ruble terms
while decreasing by 3 percent in US dollar terms due to a weaker weighted average ruble
exchange rate.
In 2016 the market saw a positive growth mainly due to the growth in sales (in ruble terms) in
4Q2016.
Trend:
The public sector decreased by 13 percent in unit terms and is continuing to shrink both in
monetary and unit terms.
The growth in the market is driven by the commercial segment, which has grown by 8.2
percent in monetary terms and by 3.1 percent in unit terms.
January-April 2017 saw the commercial segment sell 1,460 million packages, which is up by
13.6 percent from the same period in 2016.
In 2016 inflation in Russia slowed down to 5.4 percent with medicine prices growing by 5
percent, the lowest inflation rate over the last three years.
Due to the regulatory efforts, prices for drugs on the Essential Drug List (EDL) grew at a
slower rate (+1.3 percent) compared to other medicines (+6.9 percent).
The market for EDL drugs accounts for about 50 percent of the total market, both in unit and
monetary terms.
In 2016 the market for medicines priced below RUB 50 per package saw the most significant
grow – 7.1 percent. Prices for expensive medicines valued at RUB 500 or above grew just
by 1.9 percent.
In 2016 inflation was the key factor driving the growth in the pharmaceutical market in
monetary terms.
The federal program “Pharmaceutical and healthcare industry development for a period
until 2020 and thereafter” sets forth the key regulatory tasks:
• Technological upgrade of the pharmaceutical industry;
• Import substitution for drugs on the Essential Drug List;
• Launches of innovative domestic products.
development.
Trend
Increased share of local medicines sales have become one of the outputs from the regulatory
efforts by the government. The sales have been growing in monetary terms since 2013 and in
unit terms since 2015. The more pronounced growth in monetary terms is partially due to an
increasing share of more expensive domestic innovative medicines. This is particularly
evident when looking at the segment of preferential provision of medicines, which
includes innovative and expensive drugs, with local medicines accounting for 32.3 percent of
the segment. In 2016 the average price in this segment was RUB 1,700 per package while the
• Spring 2017 saw a significant improvement in the sentiment on the Russian pharmaceutical
market: the net sentiment is positive, up by 2.5 times from 2016.
• At the same time, almost one fourth of the respondents surveyed (24 percent) have
a negative view of the situation, which is indicative of the continuing negative impact
from the factors constraining the growth in the industry.
With 91 percent of the respondents having a positive view of how their companies
perform, the overall situation in the Russian pharmaceutical sector is clearly perceived
as positive.
Highlights
• Pharmacies more often tend to express a negative view, with one third (33 percent)
responding with “rather negative”.
• At the same time, generic manufacturers are more optimistic (+9 pp).
Of the respondents surveyed, 78 percent indicated that their companies import Finished
pharmaceutical products (FPPs) and 31 percent said that their companies import Active
pharmaceutical ingredients (APIs).
• Europe accounts for a major portion of the imports of APIs and FPPs for pharmaceutical
companies in Russia (50 percent and 68 percent, respectively).
• Almost one fourth of the importers (23 percent) purchase APIs from China.
However, as regards FPP imports into Russia, Chinese producers account for a tiny portion
of these imports (2 percent).
Our survey has shown that the pharmaceutical market’s concern has shifted from
macroeconomics to government efficiency in 2017.In 2017 experts are less concerned over
the situation in the Russian economy, with an annual decrease in concern down by 24 pp. At
the same time, the shortcomings of government regulation have been voted as the top issue
(60 percent). Another significant concern for pharmaceutical
respondents is insufficient public financing, with 27 percent voting for it in 2017, compared
to only 10 percent in 2016. Forex risks have seen a significant
decrease in importance (-17 pp).In 2017 strengthening competition on the market poses a
concern for more companies (+13 pp), reflecting the fact that the market is picking up after
the economic events of 2014-2015.
Highlights
• Shortcomings of government regulation (60 percent) This is above all the top issue for
localized and non-localized foreign companies (69 percent and 64 percent, respectively)while
Russian companies pay significantly less attention to it (40 percent).
• Situation in the Russian economy (36 percent) The representatives from large companies
demonstrate a stronger concern over the situation in the economy: 45 percent of the
companies with an annual turnover of RUB 10 billion to RUB 30 billion and 49 percent of
the companies with an annual turnover above RUB 30 billion.
• Insufficient public financing (27 percent) Understandably, this issue is of utmost
concern for businesses focusing on hospital sales (45 percent), as well as on sales that are
part of the State Reimbursement Program (ONLS/DLO) (77 percent)
• Insufficient purchasing power of households (20 percent)
This issue comes fourth in importance for the second year in a row. As a constraint to growth,
it has the strongest impact on non-localized foreign companies operating in Russia (32
percent).
• Strengthening market
competition (15 percent)
In 2017 Russian companies more frequently cite growing competition (23 percent).
Armenia
Armenia, officially the Republic of Armenia is a landlocked country in the South Caucasus
region of Eurasia. Located in Western Asia, on the Armenian Highlands, it is bordered by
Turkey to the west, Georgia to the north, and Azerbaijan to the east, and Iran and
Azerbaijan's exclave of Nakhchivan to the south. Armenia's pharmaceutical market is
calculated to have reached USD177mn in 2018, which translated into a modest USD60 per
capita (below the regional average) and around 14% of the country's healthcare expenditure.
By 2023, the market is forecast to reach USD323mn, with a five-year annual growth rate
(CAGR) of 12.8%.
Generally speaking, Armenia's pharmaceutical market may not much offer revenue-
generation opportunities for multinational pharmaceutical firms on account of its small
market size, and unfavourable demographic trends. In addition, growth within the market has
been negatively on healthcare spending as a whole, though the situation has improved.
However, improved regulatory environment - exemplified by amendments to the Law on
Medicines passed in May 2016 - will create greater hope in the market, boosting its
attractiveness. Most pertinently, the law introduced pricing regulations for state-reimbursed
medicines. The government has also tried to improve healthcare system spending and its
allocation. Following the lead of some of its regional peers - Georgia, Kazakhstan,
Azerbaijan and Ukraine - Armenia is looking to implement a compulsory health insurance
system to replace the current model. It is hoped that this system will increase the efficiency of
healthcare funds whilst enabling greater accessibility to higher-quality treatments. This new
system is expected to be assessed by parliament in 2020, though political and economic
factors are bound to influence the change. Armenia's disease burden, in line with its peers in
the former Soviet Commonwealth of Independent States (CIS), is dominated by non-
communicable diseases. Cardiovascular diseases accounted for approximately a quarter of the
total burden of disease and more than half of all deaths in 2016. After cardiovascular
diseases, the most prominent causes of death and injury are cancers and diabetes. Armenia's
pharmaceutical sector has been declared by the government as a priority sector for its
economic diversification programme, and its 'export-led industrial policy 2010-2020'. As
such, production of medicines has surged in recent years and is anticipated to continue this
rapid growth through to 2020. Although Armenia remains highly reliant on pharmaceutical
imports, this is likely to decline over the long term. Domestic production, which is almost
exclusively based on generic medicines, is dominated by three main drug makers: Liqvor,
Arpimed and PharmaTech.
Pharma Trade
Pharmaceutical imports reached USD137mn in 2018. For the current year, forecasts say
imports to grow by 15.3% and reach USD158mn. The figures are forecast to grow over the
next five years at a compound annual growth rate (CAGR) of 12.8% to reach (USD250mn by
2023. Pharmaceutical exports were worth USD30mn in 2018 and are forecast to increase by
33% to USD40mn in 2019. Forecast is pharmaceutical exports to grow at CAGR of 30.6% to
a value of USD115mn by 2023. This would mean a widening of the trade balance, from
USD106mn in 2018 to USD136mn in 2023, despite the fact that the import mix is likely to
increasingly favour generics. The government aims to increase pharmaceutical production
from the USD15mn in 2015 to USD75-100mn by 2020. With the adoption of Good Practice
(GxP) standards within the manufacture of pharmaceuticals by the end of 2019, Armenia's
exports will be able to compete for the significant growth opportunities in emerging markets
of the Commonwealth of Independent States (CIS) region and further abroad. The
government hopes that exports will reach approximately USD45-50mn by 2020.
Local Industry
Of the 19 licensed pharmaceutical manufacturers in Armenia, none produces innovative
medicines. The country is therefore entirely dependent on pharmaceutical imports to meet its
patented drug demand. The EU is the largest importer of medicines into Armenia on an
absolute basis, accounting for 67% of all imports in 2016. Germany, France and Russia are
the leading suppliers, accounting for 15.1%, 11.5% and 6.7% of total imports in the same
year. Pharmaceutical production is almost exclusively centred on generic medicines, with the
vast majority of drugs produced domestically on the country's Vital and Essential Drugs list.
Generic medicines produced domestically cost a reported 10-30% less than imports.
Therefore, the growth of the domestic industry will continue to be incentivised. Local
companies export to regional markets. Key importing partners of Armenia are Russia, India,
Belarus and Ukraine, though more sophisticated products have to be imported from the EU
and the US. The domestic market itself is very small with limited growth potential. Drug
makers therefore seek to export products to neighbouring markets. The easy access to
neighbouring markets in the Commonwealth of Independent States (CIS) and Central Asia
region provides significant export opportunities, particularly as many of these emerging
markets are set to expand considerably over the coming years. Major emerging markets in the
Middle East also represent potential for exploitation.
Currently, the CIS region (primarily Moldova, Belarus, Russia, Tajikistan, Uzbekistan,
Kazakhstan and Georgia) is the largest beneficiary of pharmaceutical exports from Armenia,
accounting for 57% of all medicinal exports in 2015, led by Georgia (36% of exported
drugs). The formation of the Eurasian Economic Union (EAEU) single medicine market in
May 2017 supports the potential for further export growth within the CIS region through the
reduction of trade tariffs and harmonisation of medicine registration legislation. There are 19
licensed drug makers in Armenia, of which 3 contributed to more than 70% of all production
in 2015. The key manufacturers are Liqvor, Arpimed, and PharmaTech. According to March
2018 statements made by Hakob Topchyan, director of the Medication and Medical
Technology Expert Center within the Ministry of Health, five pharmaceutical companies
operate in the country, suggesting not all licensed companies are still operational. Some 8.0%
of medicines are made locally, with the rest needing to be imported.
Belarus
Introduction
Belarus' pharmaceutical market is expected grow at a rate above average. The introduction of
a basic reference pricing methodology will improve transparency of the market, but may also
result in downward price revision. The country's domestic pharmaceutical industry continues
to expand rapidly, driven by contract manufacturing agreements and joint ventures. In 2018
market touched $ 1.18 billion and is expected to touch $ 1.19 bn with a growth of 5.8% in
2019.
Latest Updates
In January 2019, BelTA also reported that the incidence of HIV infections in the
Minsk region fell by 15.8% in 2018, to 28.3 cases per 100,000, quoting figures from
the Regional Center for Hygiene, Epidemiology and Public Health, which further
revealed that men account for almost 60% of all HIV-positive individuals.
According to BelTA reports, at the start of 2019 general practitioners (GPs) accounted
for 60.8% of the total number of primary care doctors, as the authorities launch the
Caring Clinic initiative, which aims to make GPs gatekeepers to other medical
services and also provide more personalised medicines.
In the month of Jan 2019, it is reported that Belarusian and Indian delegations met to
discuss further avenues for cooperation in the field of pharmaceuticals,
Market Overview
Belarus pharma market is set to touch $ 1.19 million in 2019. It is expected that it would
grow at cagr of 5% in the next five years and touch $ 1.43bn by 2023. The pharmaceutical
market in Belarus is likely to continue to lag behind due to the impact of Belarus' unstable
currency and its faltering economic outlook in the short-term, with the majority of growth
driven by inflation. Belarus is seeking to boost its domestic pharmaceutical industry to reduce
its reliance on foreign-made drugs given their increased price due to a weakened currency.
The government of Belarus set a target for local production to account for 55% of the market
by the end of 2020 - a significant rise from the 25-30% seen in 2012. According to
government reports in January 2018, domestic production accounts for over 50% of the
market. There has been significant investment into the country's domestic drug production
industry, with particular focus on generic medicines, over the past year. Domestically-
produced product bias is shown through the tendering process, where they account for about
80% of the market share. This has led to growth within domestic firms but has limited
opportunities for multinational drug makers. Pricing control legislature, which was passed in
May 2015, has also reduced the attractiveness of the Belarusian market. The domestic
pharmaceutical industry currently accounts for approximately 25% of local demand in value
terms. There are currently 26 companies operating in Belarus, five of which are state-owned
enterprises. The single biggest domestic player is Belmedpreparaty. Multinationals with a
considerable presence in Belarus include Roche, Novartis, Sanofi, Nycomed, Gedeon Richter
and Bayer Healthcare. The government's tendering system for pharmaceuticals is based on a
reimbursement list heavily biased towards domestically produced generic pharmaceuticals.
Pharmaceutical Trade
Local manufacturing improvements and government support will serve to correct the
negative trade balance to an extent and also reduce import reliance. However, over the
coming five years, major changes may not be seen as, innovative medicines continue to be
supplied through imports. At the same time, however, expanding domestic capacities should
be able to take advantage of the rising regional demand for generics. Pharma imports reached
$ 694 million in 2018. At a CAGR of 3.5 imports may touch USD825mn by 2023. Belarus is
also well positioned to become a pharmaceutical export hub within the CEE region, given its
proximity to the some of the largest pharmaceutical markets in the region - Russia, Poland,
Romania, and Ukraine. Furthermore, it has strong economic and trade ties to the former
Soviet CIS countries further to the East
Eurasian economic union
The proposal for a Eurasian Economic Union (EAEU) medicine market aims to increase
accessibility to safe, effective and quality healthcare and medicines, through the elimination
or minimisation of administrative barriers between the member states. Talks have been
ongoing for many months with a view to initiating a single medicine marketplace for
Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia; however, there have been constant
delays and disagreements over the regulations. In November 2016, the Eurasian
Intergovernmental Council agreed on a package of documents to launch the single medicines
market. Discussions regarding common legislation are on, this development greatly increases
the possibility of a fully functional single market in the short term.
It is this formation that might pose difficulties for India’s exporters as it would be difficult to
compete with fast developing Russian industry which will gain local status and may shrink
the available generic opportunity. India’s exporters need to necessarily setup units in the
Eurasian economic union either independently or in JVs.
India’s investments :
In January 2017, the Chairman of the Republic of the National Assembly announced
that at least three pharmaceutical plants will be established in Belarus with Indian
cooperation in the next two to three years.
Construction of a pharmaceutical plant for a joint venture between Indian Lok-Beta
Pharmaceuticals and Belarusian Belmedpreparaty, Novalok, began in January 2017.
According to the Chairman of the Council of the Republic of the National Assemble,
at least three Indian-Belarusian pharmaceutical plants will be built in the coming
years.
A joint Belarusian-Indian public-private partnership (PPP) pharmaceutical firm,
DzhivaFarm, began construction of its production facility in August 2016, with an
expected start date for commercial production in 2018. The facility will be focussed
on the local production of generic medicines to treat diseases such as cancer and
hepatitis, with the aim of producing drugs at as much as five-to-seven times less than
current market value.
The construction of a new generic drug factory specializing in treatments for cancer,
autoimmune diseases and severe infectious diseases will be completed by the end of
2016. The newly-formed NatiVita is building the plant at a cost of USD15mn, and has
received investment from pharmaceutical firms Natco Pharma (India), Biocad
(Russia), Belarusian medicine distributor VitVar, as well as Lithuanian investment
company ZIA Valda.
Kazakhstan
Kazakhstan remains the most attractive pharmaceutical market in Central Asia, in terms of
the overall regulatory environment and ease of doing business compared to neighbouring
countries. The domestic market is constrained by the relatively small size of the population
and daunting infrastructure challenges. Pending World Trade Organisation (WTO) accession,
expected as soon as this year, as well as Kazakhstan ' s membership in the Customs Union
(CU) with Russia and Belarus should drive continued improvements in regulation and
harmonisation, assuming the contradictions of membership in the two groups (such as
common external tariffs) can be ironed out. Meanwhile, foreign investors have acquired
controlling stake in the three largest pharmaceutical manufacturers - Chimpharm, Nobel and
Global Pharm - and have committed to expanding manufacturing capacity and creating Good
Manufacturing Practice (GMP)-complaint facilities. The government announced in February
2012 that it would review options for new pricing regulations to address high prices, a
process that both domestic and foreign players will be watching closely.
Key Trends
In February, Ministry of Health and competition officials gave the strongest signals yet that
they would contemplate "regulation of prices" of medicines, with the head of the Kazakhstan
Agency for Protection of Competition saying an analysis of the market found several areas of
concern that were driving higher prices. The timeline for the enaction of future pricing
regulations is unclear, although BMI is concerned as to whether the development and
eventual enaction of such controls will be done in consultation with the domestic and
international pharmaceutical industry. BMI has previously outlined areas of concern, such as
the fragmented wholesale sector and a lack of clear rules for doctor’s pharmacists regarding
providing patients with the cheapest generic alternatives. However, rather than setting prices
or margin limits, there is hope that the Kazakhstani officials look at root causes of high prices
and contemplates steps that would foster greater competition and the development of more
efficient private-sector delivery, such as modern format chain pharmacies.
The Kazakhstani authorities have claimed continued sustained falls in maternal and infant
mortality rates in the country, along with death from circulatory system ailments and
tuberculosis, which if correct suggest that sustained increases in healthcare spending in recent
years, coupled with economic growth, have made significant inroads in the broader
epidemiogical situation following a period of decline in the 1990s after the collapse of the
Soviet Union that reversed over the past 15 years. The Ministry of Health released statistics
in February that showed maternal mortality rate had decreased by 3.7 times and infant
mortality by 25% between 2010 and 2012, according to a transcript of a parliamentary speech
published on the website of the ministry. Mortality from circulatory diseases fell by 20% over
the same period. The ministry cited the success of the Salamatty Kazakhstan (Healthy
Kazakhstan) initiatives, the main state-driven strategy for increasing access to healthcare. In
addition, healthcare remains a priority of the president's so-called "Kazakhstan 2050"
programme, a blueprint for the long-term development of infrastructure and key social
services over the coming decades.
Approximately 40% of the market is represented by the hospital sector and public
procurement.
Two thirds of drugs for the public healthcare system are purchased through Single
Distributor SK-Pharmacia which is 100% owned by the state. It is responsible for
buying drugs at public tenders, storing and delivering them to hospitals.
Another third of drugs in the public sector is funded by regions and is primarily
targeted at outpatient care hospitals.
Wholesalers
Pharmacies
Market overview
According to the information obtained from the Ukrainian State Service for Medication, in
2013 the volume of the market for pharmaceutics increased by 14% in comparison to the
previous year and amounted to UAH 36.2 billion (€3.345 billion, 1 EUR = 10.82 UAH, as of
December 31, 2013. Exchange rate stated by the National bank of Ukraine). Experts claim
that the competition becomes stronger and the market gets more attractive for both domestic
and foreign companies.
In 2013 the sales of Ukrainian companies improved by 17.9% of the amount sold in 2012,
and as of the April 1, 2014, the Ukrainian medications constitute 65.6% of the assortment
presented in drugstores. However, there are some negative trends on the market. About 2/3 of
the money that households spend on medication are received by foreign producers of
medication. These companies supply the same goods as the Ukrainian companies do, though
the price they charge is higher. The average price for a medication produced in Ukraine
accounts for UAH 10.9 (€1, 1 EUR = 10.82 UAH, as of December 31, 2013. Exchange rate
stated by the National bank of Ukraine), while the average proce for the medication produced
abroad amount to 47.9 UAH (€4.43, 1 EUR = 10.82 UAH, as of December 31, 2013.
Exchange rate stated by the National bank of Ukraine).
Market specialists state that in Ukraine during 2013 production of medications that contain
penicillin and other antibiotics improved by 16.4% in comparison to 2012, production of
medications that contain hormones and do not contain antibiotics increased by 13.3%,
production of medications that contain alkaloids or their derivatives and do not contain
hormones or antibiotics went up by 9.9%. There are more than 100 pharmaceutical
companies and a network of 20.000 drugstores that operate on the territory of Ukraine.
Furthermore, there was an investment inflow of $120 million in the pharmaceutical sector in
2013.
Market trends
Ukraine remains the 2nd largest market in CIS, shows positive growth in values and still slow
down in units.
Per capita consumption in units is much higher in countries, where there are prototypes of
reimbursement system and government participate in compensation of treatment for
population (Kazakhstan, Belarus).
Hospital Segment
2016 was marked by local deals and investments focused on consolidation of local market by
leading players and new projects development. Intosana, which is owned by CIS private
equity fund Russia Partners, acquired Medisvit with two local clinics in Kiev for an
undisclosed amount.
Owners of another clinic Oberig announced ambitious plan to build another hospital in Kiev
with total costs of 1 bn UAH (c. 40m USD) to be completed in 3-4 years’ period. At least two
other companies – Dobrobut and Oxford Medical are planning regional expansion and
opening standalone clinics in Kiev.