Russia Gets Hooked On Imported Drugs

The Russian Federation is becoming increasingly dependent on a rising tide of drug imports, with no signs of recovery in the performance of the country's own drug industry, according to Mikhail Grigoryev, the head of the Biopreparat. His company accounts for 40% of domestic drug output and has a 12% share of the Russian market in which 150 licensed producers operate with an aggregate turnover of $700-$800 million a year.

Mr Grigoryev says that the rot set in when a 30% profits ceiling was introduced for drug producers in 1994. Then the distribution network collapsed. His view is that the government first has to impose an import levy or quota system on all imported drugs, with exemptions only for those drugs Russia cannot produce itself, eg antidiabetic drugs. Such a system is urgently needed, he added.

In 1995, the entire Russian drug market was worth 8,300 billion roubles ($1.53 billion), with domestically-produced drugs accounting for 3,500 billion roubles and imports for 4,800 billion roubles. Investment at federal and local level in domestic drug production and import purchases reached 3,200 billion roubles and 4,300 billion roubles respectively.