Russian Shortage Of Cheaper Drugs

Despite the relatively wide product range in Russian pharmacies there isa shortage of cheaper drugs, says Benjamin Moonblit, health care and pharmaceutical projects director at InterMatrix. This is believed to be due mainly to pharmacists' reluctance to handle cheaper drugs, but also reflects problems in the Russian health care system.

Health insurance provides a 50% drug discount for certain people, while the handicapped, decorated war veterans, people involved in the Chernobyl nuclear plant cleanup and others are entitled to free drugs. But in practice, apart from in Moscow and a few larger cities, free drugs are in short supply, and are frequently "misappropriated" by operators who then reportedly overcharge the state and regional authorities for them.

Another feature is the wide gap between the ex-factory and pharmacy prices, attributed by local experts to inadequate marketing and distribution. Russian drug imports are handled by several intermediate agents and there is frequent marking-up to establish "assets to offset contingencies." The government is supposedly monitoring drug prices, and limits on markups have been imposed, in theory, in all provinces except the Samara region. The markup on drugs in Moscow, for example, must not exceed 50% of the ex-factory price. But in practice, efforts to contain soaring drug prices have been unsuccessful and importers have bypassed restrictions. The trade is lucrative.