Polish Drug Sector, "Good Prospects" But Long Path

Recent reports on the Polish drug industry (see Marketletter March 3)have noted the industry's strong growth prospects, with a good domestic sales base and a far-from-stagnant export trade. However, a number of industry observers inside and outside the country are now arguing that development is being hindered by resistance among drug producers to privatization.

The market is promising enough for western producers to lower their prices to a fourth or fifth of the original and set up their own drug production. Also, the introduction of Good Manufacturing Practice standards - one condition for European Union membership - is expected to further increase the industry's competitiveness, especially in the generics sector, which makes up the bulk of Poland's pharmaceutical exports.

"Profits Set To Decrease" However, Bohdan Wynikiewiez, head of the Gdansk Institute for Market Economics, which has published an analysis of economic indicators, says profits in the sector are set to decrease in the years ahead. He argues that costs are too high to achieve reasonable profitability as the government artificially controls pricing.