Russian government considers more ways of saving on drug purchases

Print 04 September 2013
The Pharma Letter

03 September 2013. The Russian government is considering ways of saving on the purchase of drugs, which is expected to take place through the re-registration of all the drugs (and in particular those which are subject of state purchases), limitation of public procurement for essential/vital drugs, as well as the introduction of reference prices.

In the case of re-registration, according to state plans, this will limit the circulation of low-quality drugs in the market as, due to unsophisticated requirements for drugs’ quality in the past, the market was flooded by low grade drugs. 

Moves will create problems for pharma 

However some Russian analysts have already expressed their concerns that re-registration may create serious problems for the Russian pharmaceutical market, as many important drugs will leave the market. According to Dmitry Morozov, a co-owner of Biokad, one of Russia’s leading drugmakers, the process of recovery will take about 10 years. 

Another way to save money, which is being considered by the government, is to limit state purchases of drugs, which are not included in the list of vital medicines. However the latest proposal may result in the creation of administrative barriers to many foreign drugmakers which plan Russian expansion. 

There is also a possibility that the government may pay only for those drugs, which provide guaranteed effect. This will be similar to the practice of risk-sharing between the government and a drugmaker, which is actively used in some European Union countries.

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