Pharma Companies Without Comment on Russian Market FutureFebruary 28, 2022
Scary images that we see from Ukraine make us realize true values of life: health, food and roof on top of our head. At this moment these things are deprived from citizens of Ukraine and they are left to the mercy of a much stronger enemy. However, as the crisis deepens it becomes clearer to us that it is affecting Ukraine only temporarily and it is just a matter of time when it will start to affect us. Maybe that is the reason why the EU hesitated to impose sanctions against Russia.
Now that the EU finally imposed serious sanctions against Russia, which will completely devastate the Russian economy, it is time to prepare for the aftermath of the downfall of Russia’s economy and its effect on the rest of Europe.
European pharma companies whose substantial part of income comes from Russia, will feel the significant consequences of the Russian Ruble collapse.
For example, the Swiss pharma giant Novartis has completed in 2015 the construction of a large plant for production of solid oral dosage forms, Novartis Neva. Currently, Novartis Neva produces integral portfolio of innovative medicines and generics by Novartis and Sandoz for the Russian market. Cardiology, transplantology, oncology, neurology and endoctrinology are the main therapeutic areas of application of the medicines produced in the factory. We have asked for a comment, but got a brief reply: “Novartis and Sandoz operate globally, and we have world-leading experience in continuing medicine supply chains during times of unrest or conflict. Our experts will continue to monitor the fast-moving situation closely. The safety of patients is our priority.”
French drug maker Servier has been working in Russia since 1984, when it signed the first agreement with the Russian center for clinical research. In a press release from 2017, Servier said that the first partnerships were a continuation of healthcare collaborations established in the early 1980s between France and Russia, precisely between the National Institute of Health and Medical Research («Institut National de la Santé et de la Recherche Médicale » or INSERM) and the Russian research centers.
Then in 1992, the first Group subsidiary in Russia, ZAO Servier, was created. During the Russian financial crisis in the late 1990s, Servier chose to keep its activities in the country, maintaining employment and reinforcing its commitment to Russia. Besides its activities of promotion and training in its subsidiary, Servier Russia developed its research arm by opening an International Centre for Therapeutic Research (ICTR) in 1999. In 2007, Servier furthered its development in Russia by opening the Serdix production site in Sophyno, in the Moscow region. It accounts for 85% of the needs of the Russian market for Servier medicines. The Servier Group now has a broad presence in Russia with over 1,200 employees. EGIS, the Hungarian Servier subsidiary specializing in generic medicines is also present on the Russian market.
According to the company’s 2021 financial statement, Russia was in the top three markets for Servier. In a reply to our question, Servier did not comment business. It said: “We have no comment at this stage. Servier Group’s priority is to guarantee that all patients continue to access the medicines they need, and we are committed to ensuring the safety of Servier’s Group employees and their families in the area.”
Germany’s pharma giant Bayer has business relations with Russia since 1876, when Bayer opened a dyestuffs factory in Moscow. This was Bayer`s first production facility outside Germany.
Today with AO Bayer in Moscow all Bayer divisions are represented in Russia: Consumer Health, Pharmaceuticals and Crop Science. The regional company network in Russia comprises 36 locations with representative offices in all main cities. The company is also headquarter of the Bayer CIS country group, with subsidiaries in Minsk, Belarus and in Astana, Kazakhstan. This is Bayer’s brief reply to our query: “We are very concerned about the current developments in Ukraine. The safety of our employees is now our top priority, and we are taking all appropriate measures to protect them. At the same time, we are doing everything we can to further ensure the supply of our products – including vital medicines and agricultural products to safeguard food supplies – to the civilian population.”