Fourth Ukrainian Pharmaceutical Forum a Success
Release Date: 0000-00-00
On October 17-19, Adam Smith Conferences organized the fourth edition of Ukraine’s biggest annual pharmaceutical event. The Ukrainian Pharmaceutical Forum brought the key figures of the industry together in Kiev’s Intercontinental Hotel for two days and eight sessions of high-level discussions on the latest developments in the sector.
One of the main themes of the conference was the regulation of the sector and the government’s main priorities for developing the pharmaceutical industry in Ukraine. The first session saw a number of top government officials, among them Olexiy Solovyov, Chairman of the State Administration of Ukraine for Medicinal Products, and Mykhaylo Rusynskyi, Deputy Chairman of Urkaine’s Antimonopoly committee, giving their vision on problems and prospects of new government regulation.
A range of legislative measures to tackle the pressing issues that the pharmaceutical industry deals with have been under discussion lately: reimbursement of medicine purchases, mandatory healthcare insurance, stricter rules on advertisement for prescription drugs and OTC medicine, and more control over organized biddings at government tenders. Price mechanisms for vital medicine are in place now for medicine on the list of vital and essential medicine, with mark-ups being 12 per cent for wholesalers and 25 per cent for pharmacies.
Rusynskyi announced that the Anti Monopoly Committee is planning massive full investigations of the biggest manufacturers in the coming year, while the committee is also cooperating more and more with Russian but also EU law enforcers to fight illegal generics.
Another highlight of the conference was the interview with Alexandra Sologub, General Director of Teva Ukraine. The interview, taken by Liubov Snigur, Director of Production Company “Zdorovo” & Producer of the TV Program “Zdorovo,” dealt with the challenges Teva encountered in expanding its business in the Urkaine. Teva is seen as one of the most dynamic players around in the Ukraine, taking a leading position in 2008 after purchasing Barr and its Croatian subsidiary Pliva, a major generics producer with a strong position in the Ukraine.
Sologub’s interview was followed by more representatives of the Ukraine’s key medicine producers speaking on the challenges of running a successful business in Ukraine. Sergey Orlyk, one of the country’s most well known independent experts on pharmaceutical business issues, led a panel consisting of Jean-Paul Scheuer, General Manager of Sanofi-Aventis Ukraine (through Skype); Andrey Stogniy, Area General Manager of GlaxoSmithKline Ukraine, Belarus, Moldova, Caucasus; Muralidharan Thrithala Kizhakekalam, Head of Representative Office of Dr. Reddy's Laboratories Ukraine; Marina Simashova, General Director of Unipharm Ukraine; Oleg Siarkevych, Business Development Director and Member of the Board of Farmak; and Yevgen Sova, Commercial Director of Borschahivskiy Chemical-Pharmaceutical Plant.
The discussion focused on cooperation with the Ukrainian bureaucracy, which, some said, lacks efficiency and knows high levels of corruption, leading to skepticism on the effectiveness and the enforcement of government regulation. The role of the associations in the pharmaceutical business is important making the cooperation run smoother and defending the interest of the industry; another subject on which a lively discussion is ongoing in the Ukrainian pharmaceutical industry, as the authority, opportunities and influence of the associations came under question during the conference.
Concern was expressed about their effectiveness in dealing with the Ukrainian bureaucracy: the associations react too much and initiate too little. The response of the associations, represented prominently by, among others, Vladimir Ignatov, Executive Director of AIPM Ukraine, and Yuriy Savko, Executive Director of the Association of Pharmaceutical Research and Development, is that it is not an easy task to deal with an extensive and complicated government apparatus, a task that is further hampered by the absence of legislation on lobbying.
The next day, at sessions five and six, “The Ukrainian pharmaceutical industry’s potential for development” and “Financing and investments” respectively, intense discussions were seen on foreign investment, or the lack thereof. The market has shown strong growth numbers over the past years, often reaching 15 per cent, but the bigger part of this growth doesn’t come from sales growth, but from price growth. One of the prominent voices in the discussion was Jose Luis Colas, General Director of Ucrafarma S.A., and one of the few foreign investors who dared to invest in local production facilities. Colas decided to buy a stake in a Ukrainian pharmaceutical factory, Sperco, three years ago.
Throughout the discussions, Colas explained the meager investment numbers by the fact that Ukrainian companies are not ready for it; they don’t have their audits in place, they are not transparent enough and the proper legal structure is absent. Other problems that often arise concern unwillingness of key decision makers to let foreign investors take a share of their company, some said because they might not properly judge the advantages that this investment could bring. On top of that, the overall investment climate in the Ukraine is not perceived as favorable: economic problems, social upheaval and a volatile political landscape are not the qualities foreign investors are looking for in a potential market.
The next conference that Adam Smith Conferences, the organization behind this latest successful edition of the Annual Ukrainian Pharmaceutical Forum, organizes in Kiev will be the Ukrainian Banking Forum on November 15-17.
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