NEW RUSSIAN IMPORT RULES DIVIDE WINNERS, LOSERS
New Russian government regulations limiting subsidies on drugs only to companies which manufacture in the country -- set to be introduced in December -- pose a new challenge for foreign firms. While a recent move to a cash payments-based reimbursement system has been applauded, the authorities' currently nationalistic mood is becoming an increasing source of frustration.
The plans will strengthen the hand of key regulator Roszdravnadzor, as the government increasingly moves to boost involvement in the strategic drug sector. Official statistics indicate that Russia imported drugs worth US$2.83bn in 2004, equivalent more than half of pharmaceutical demand in the year.
Aware of this, the authorities remain eager to boost the local manufacturing sector, the better parts of which are already in foreign hands. Nevertheless, it remains to be seen how interventionist the government's actions will become, while fears of Yukos-style re-nationalisation appear exaggerated at present.
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21Oct