Import substitution in a crisis

Lyudmila Kolbina, "Expert Ural" No. 37-2015

Before the crisis, the pharmaceutical production of the region accelerated well, received investments and development potential. How far can you drive it?

Ural pharmaceutical manufacturers increased their output from 5.2 billion rubles in 2011 to 8.2 billion rubles by the beginning of 2015. A good pace of development continued until November last year. In pharmaceuticals, the country lagged so far behind that only dynamic forward movement and billion-dollar investments could save it. With the expansion of the crisis, both are fading. The situation is complicated by the significant, up to 95%, dependence of many enterprises on the supply of substances from abroad. Moreover, manufacturers did not set themselves the goal of producing their own substances. This is the world practice: not even all large companies, with all their technological and competitive capabilities, are doing this. Now it is becoming more and more obvious: in order to ensure the country's drug safety, a certain amount of substances must be produced themselves.

Many major projects in pharmaceutical production, as well as in other areas, are postponed. Meanwhile, several unique innovative projects have been launched in the Urals this year. According to Alexander Petrov, Chairman of the Supervisory Board of the Novouralsky Pharmaceutical Technopark, this is facilitated, firstly, by the unfavorable foreign policy situation, and secondly, by the state policy towards the domestic medical industry set out in the federal Pharma 2020 program, which promises to create all conditions for import substitution in the industry.

Both the substance and the production technology are completely domestic. The drug that kills the flu is produced by the Novouralsky plant "Medsintez". This is import substitution in its purest form.

In June, the Ural Nanotechnology Center (UCN, part of the Ural Biomedical Cluster, resident of the scientific and innovation Technopark in Novouralsk) launched in Polevskoye (Sverdlovsk region) own production of long–acting antimicrobial coatings - desitol C (for indoor treatment) and desitol B (for skin treatment). The design capacity of the line is 540 tons of products per year, it is fully automated (only 15 people serve). Consumers are medical institutions, diagnostic and clinical laboratories, cosmetology centers, preschool institutions.

– In most technologies of long–term disinfection, the principle of photocatalysis is used: the active substance is titanium oxide, active only under the influence of ultraviolet rays. We have received a product that does not have these disadvantages: it always works – indoors, in cloudy weather, at night. The coating forms a thin polymer antimicrobial film, destroys HIV, pathogens of plague, cholera, anthrax and pathogenic fungi, – says Natalia Tkachenko, General Director of the UCN. – Desitol is a domestic development (created by Ural and Moscow scientists, invested $ 5 million), has no analogues in the world: its modifications provide protection from 12 hours to 12 months.

According to Natalia Tkachenko, the implementation of the project is within the allotted time frame, the costs are planned to be recouped by 2018. The company completes the start-up work on the main product line, accumulates for the warehouse, for customer orders. On the day of the release of "E-U", September 7, the plant should receive the final registration documents for desitol B (they already exist for desitol C) and reach industrial volumes: by the end of the year – 100 tons of products of the entire line. The market shows that he is interested in desitol. The main consumers were identified: in Tatarstan, Bashkortostan, Chelyabinsk, Sverdlovsk and Tyumen regions, in Moscow, Irkutsk, Transbaikalia. In a number of other regions, clinics have also been tested and are preparing for purchase at auctions. The company also enters foreign markets (in particular, a contract has been signed with Egypt), here the exchange rate difference plays into its hands.

The crisis affected the project: it complicated the supply of imported equipment, exchange rate differences made themselves felt. But it helps that the share of imported components in the cost is insignificant (10%) in order to influence the cost and costs.

Import substitution can be called all the products of the Ural startup. One of the competitive advantages is that prices are lower than those of foreign analogues: we save on logistics, domestic raw materials and technologies. To date, the investment stage has been completed, the first sales have begun, which help to form budgets and advertise. The company is reaching a stable level. The status of a resident of the pharmaceutical technology park, participation in international forums, exhibitions, allows a startup to find a profitable partnership, including on the territory of the EU.

Is it the right time at the time of budget cuts for the main consumers to launch and promote such innovative breakthrough projects? On the one hand, Natalia Tkachenko notes, the project is experiencing some tension: hospitals say that they have bad money. On the other hand, a price policy that takes into account the market conditions significantly helps to advance in the level of sales. Clinics perceive the innovative product with great interest. Value for money is important to them. Prices are on average by 30%, and in some positions – twice lower than analogues. For budgetary medical institutions, this is very significant, besides, they save due to the fact that new products are long–acting. The Nanocenter intends to start implementing new projects this year, including the production of medical devices.

Another, no less high–profile project is the Medsintez plant, the anchor enterprise of Novouralsky. As part of the August agreement with the international chemical and pharmaceutical concern Bayer, he launched on September 3 the serial production of avelox, a new generation antibiotic. The volume of the first series is 9 thousand packages. It is planned to produce 150 thousand packages by the end of the year, and 300 thousand in 2016, which will cover up to 100% of the needs of the Russian market.

– This is an unprecedented event for the pharmaceutical industry not only in the Sverdlovsk region, but also for the entire federation, – said another Alexander Petrov, deputy of the State Duma of the Russian Federation and chairman of the Supervisory Board of the Ural Biomedical Cluster. – Until now, no one in Russia has produced the latest generation of antibiotics that kill all known strains of microorganisms. It is possible that the domestic antibiotic will be exported abroad: firstly, the agreement with Bayer allows it, and secondly, the Russian avelox is no different from the European one.

The prospects of the plant include the launch of the production of an insulin substance and an insulin pump, which will be able to completely replace Western analogues. The pump is one of the instruments of drug administration: like a pen-syringe, but more perfect. In fact, it is a mini-computer about the size of two matchboxes and weighing only 69 grams. With the help of a catheter, the pump is attached to the patient's body, then a program is set according to which microdoses of insulin are injected. The average cost of a foreign pump is from 120 to 160 thousand rubles. Plus, the patient spends about 8 thousand rubles a month on consumables. Only 1% of diabetics in Russia are provided with such devices. The domestic development was presented by Ural scientists at Innoprom-2015, the first samples have already passed test tests, the registration procedure has begun. Prices should be 20-25% lower than foreign analogues.

The first one was at Innoprom 2015, the Novouralsky technopark and the Chinese company Yantai Huazheng Medical Apparatus Technology Co signed an agreement on localization of the production of third–generation vacuum blood sampling systems in the Sverdlovsk Region. Investments in a joint project with Chinese partners will amount to about 200 million rubles.

Second, in August, the technopark and the Slovak company MEDICARIM SE signed an agreement on cooperation in the development, research, production and promotion of medicines.

Ural Pharmaceutical Cluster is actively negotiating cooperation with major Indian companies. Our interest is in an extensive distribution network around the world, which is planned to be used for the distribution of pharmaceutical products in the Sverdlovsk region. Negotiations with the Indian side are conducted with the participation of the Ministry of Foreign Economic Relations and Minister Andrei Sobolev personally.

Another significant project for the domestic pharma – at Innoprom 2015, Johnson & Johnson Corporation and Pharmstandard Group (the group includes Pharmstandard-Ufavita in Ufa) signed an agreement on the production of blood glucose self-monitoring systems in Russia, as well as cooperation in the development of innovative diabetes management technologies. Every year, the state spends about 156 billion rubles on the treatment of the consequences of the disease, nevertheless, more than 66 thousand patients die. One of the key elements of preventing complications, and, consequently, increasing life expectancy and reducing budget costs for treatment, is regular self–monitoring of blood sugar levels using glucose meters and test strips. The first domestic development of LifeScan, which allows patients with diabetes to independently monitor the condition, will appear in the third quarter of this year. As noted by Vladimir Kreyman, CEO of Pharmstandard-Ufavita, the line created under the agreement will be certified in accordance with ISO 13485 international standards, which allows us to talk about the quality of production. It is planned to expand capacities for exporting Russian products to other markets, including CIS countries.

But no one can answer the question of how soon the domestic pharmaceutical industry will be able to produce a sufficient number of medicines of the right quality.

If five large enterprises have been launched in the Sverdlovsk region in the format of a pharmaceutical cluster, then they have not been producing their own drugs in the Tyumen and Chelyabinsk regions for a long time. Kurgan region was more fortunate: JSC "Sintez" works here – an innovative enterprise that produces a wide range of products in accordance with international standards. According to Executive Director Vitaly Pshenichnikov, imported materials (components, raw materials, substances) account for more than 42% of the cost of production. Abroad, the company buys 130 names of substances, whereas in Russia only 13. Despite all the difficulties associated with the growth of the exchange rate, production has not yet decreased.

The dangers inherent in the chronic ignoring of the problems of this industry by the state await the domestic pharmaceutical industry in the future. The result is low competitiveness, underdevelopment of modern scientific and experimental base, personnel training system. The most serious risks for companies in the foreseeable future are created by external economic factors.

The nearest test for the viability of pharmaceutical manufacturers operating in the Russian market is that they must submit applications for re–registration of the maximum selling prices for vital and essential medicines by October 1. It remains almost a month. However, the new procedure for registering prices has not yet been approved, the FAS began preparing the relevant document only in mid-August. According to Alexander Petrov, Chairman of the Supervisory Board of Novouralsky Pharmaceutical Park, it will be laborious for manufacturers to prepare the necessary package of documents in such a short time. But he hopes it's doable.

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09.09.2015