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What Russian pharma requires to grow

Russias pharmaceutical manufacturing sector has taken off in recent globally

years. To expand further, the industry requires an integrated approach
to education, research and production. Russian pharmaceutical market may grow
12 September 2016 Vasily Ignatiev, specially for RIR
Russia has
by 8% in 2016
climbed
from 54th to
51st place in the World Banks 2016 Ease of Doing Business ranking and
we entrepreneurs in the pharmaceutical industry feel that change is
happening for the better. Supporting the development of local
pharmaceutical production of medicines has been declared a priority by the
state and, as a result, the share of drugs produced by Russian companies
on the market is increasing.

Drawing by Iorsh
The Russian pharmaceutical industry as a whole is maturing. It has begun December 2016
to attract people and investment from other sectors and the main
April 2014
investment activity is shifting from producing finished dosage forms to research and development. Additionally, Russian
pharmaceutical firms are pursuing access to foreign markets.
March 2014

There are several main trends in the world pharmaceutical market today. An important one is the relatively high growth in global
February 2014
production of active pharmaceutical ingredients. The volume of these ingredients was estimated at $109 billion in 2011. It increased
to $150 billion in 2015 and the forecast for 2020 exceeds $200 billion. This growth is stimulated by the continued stable demand for January 2014

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7/3/2017 What Russian pharma requires to grow globally
drugs in the mature markets of North America and Europe and the drive to fulfil unmet needs in developing countries. Production of
December 2013
ingredients for cancer drugs is the fastest-growing segment of the industry.

Another important factor is the expiry of a number of important drug patents in recent years, which allows these drugs to be
produced by other pharmaceutical companies. Finally, the advance of technology reduces the cost of the process of creating high-tech
drugs and allows for them to be mass-produced.
Diseases
Tapping into these trends requires an integrated approach in which different sectors, including education, fundamental and applied
sciences, research institutes, small and medium-sized innovative companies and venture investors are connected in a single chain Health Awareness
aimed toward fulfilling a single goal. In developed countries, the major manufacturers of ingredients are at the same time major
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players in the global pharmaceutical market.

Uncategorized
Their decisions on what production infrastructure to place where usually depends on technological aspects. If the process at all stages
requires a high degree of control and qualified personnel, it is transferred to a full cycle and localized in a single country. This is a
typical situation for innovative biotech drugs. In other cases, particularly in producing large volumes of ingredients and in the
presence of environmental risk factors, production is transferred to a foreign site.

Could a Russian pharmaceutical firm become such an industry leader? The question of feasibility and economic viability arises in the
segment of large-volume ingredients, which are now mainly delivered from India and China. Russian companies have to decide
whether it makes sense to set up our own production line in a situation, for example, when the annual consumption of a drug
amounts to 35 to 50 tons and a single major manufacturer in China produces 75,000 tons of this drug a year. Such a project would
require competent management and a clear business plan focused on both the local market and exports.

Russian pharmaceutical producers must also take into account the trend towards environmentally friendly production of active
pharmaceutical ingredients. For many years, this production was centralized in developing countries, but now governments around
the world are beginning to require ecological standards for drug production.

The main source of pharmaceutical ingredients for Russias domestic pharmaceutical industry today is still comprised of imports, which Diseases (1)
hampers the further development of the Russian pharmaceutical industry. However, the country already has around 30 domestic
enterprises that produce active pharmaceutical ingredients. Health Awareness (1)

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My company, R-Pharm, can list a number of successful cases of localization with a full production cycle and we are developing a
separate production project on the synthesis of ingredients. As more domestic innovative products become available, Russian
Uncategorized (1)
companies may well organize their production within the country, taking an important step towards the integration that is necessary
to be a major player on the global market.

Vasily Ignatiev is the CEO of the R-Pharm group of companies.

The opinion of the writer may not necessarily reflect the position of RIR or its staff. Diosmin/Hesperidin Indian drug

Source: (RBTH Network | http://in.rbth.com/opinion/2016/09/12/what-russian-pharma-requires-to-grow-globally_629097) manufacturing sector

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