Squeezed by Sanctions, Russia Turns to Domestic Pharmaceutical Production

The share of Russian-made pharmaceutical drugs for cancer treatment almost reached 50% in its segment of the market in 2017, rising from 13.2% to 46.9% over the past five years, Izvestya reported citing a report by the Ministry of Industry and Trade obtained by the newspaper.

Meanwhile, the share of Russian medicines in the vitally important and essential drugs sector exceeded 84% last year, the report for 2017 said. The share of domestic drugs to treat hepatitis reached 31.6%, while the segment for HIV treatment doubled in 2017.

“The share of domestically produced drugs is growing, first and foremost, in the segments with high amounts of government financing,” said pharmaceutical expert Evgeny Kardash. However, many Russian factories are just beginning to master modern production technologies, for example, in accordance with the GMP standards, therefore, some drugs cannot compete with ones imported from the West.

On the other hand, Alexander Saversky, President of the League for Patients’ Rights Protection, says he is certain it is necessary to push ahead with efforts to increase the production of domestic medicines due to the complex political situation.

“Despite the unstable economic situation, the popularity of Russian-manufactured drugs is gradually growing, said Elena Nevolina, head of Russia’s Pharmacy Guild. According to the expert, these drugs can be cheaper than imported ones, owing to the absence of customs duties.

“Our country is capable of boosting production capacities to such an extent that Russia will be able to do without imported drugs in the coming decade,” she stressed.

After Washington imposed the latest set of sanctions aimed at punishing Moscow for its “malign activities”, the Kremlin announced its response will be “tough”, but is yet to roll out counter-measures. A bill that is currently under revision in the upper house of Russia’s Parliament, proposes a series of counter-sanctions against American pharmaceutical imports.

The United States is Russia’s fourth-largest trading partner. Imports from the U.S. totaled $12.7 billion last year, according to International Monetary Fund data, with cars, pharmaceuticals, and medical equipment among the top items. Exports to the U.S. were $17 billion.