Pharmaceuticals Ukraine report 2012

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Acknowledgements

Focus Reports would like to thank Oleksiy Solovyov, Head of the State

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For exclusive interviews and more info, please Copyright ©All rights reserved. No part of this publication maybe reproduced in any form or by any means, whether electronic, mechanical or otherwise including photocopying, recording or any information storage or retrieval system without prior written consent of Focus Reports.While every attempt is made to ensure the accuracy of the informa-tion contained in this report, neither Focus Reports, neither the authors accept any liabilities for errors and omissions. Opinions expressed in this report are not necessarily those of the authors.

Contents

Acknowledgements ...............................................................................3

UKRAINE: Opportunity Beckons the Bold ............................................7

Health At Your Own Risk ........................................................................8

Recurrent Reactivity Required .............................................................10

Grooming A New Landscape ...............................................................14

Interview with Vladimir Ignatov - Executive Director, Association of International Pharmaceutical Manufacturers (AIPM) ..........................................................................20

Interview with Petru Bagriy - Executive Director, Association of Manufacturers of Medication of Ukraine (AFVU) ......................................................................................22

Interview with Eugene Zaika – Director, Nycomed Ukraine ..................................................................24

Interview with Glib Zagoriy – CEO, Darnitsa .....................................26

Interview with Viktor Poushkarev - Head of CIS Region, Orion Pharma ......................................................28

Interview with Vladimir Sayenko Managing Partner, Sayenko Kharenko ................................................30

List of exclusive interviews on pharma.focusreports.net ..................32

Directory .................................................................................................34

Index ......................................................................................................39

Past reports ............................................................................................40

This report was prepared by Focus Reports


FOCUS REPORTS6 March 2012


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G earing up to its co-hosting of the 2012 EUFA European Soccer Championship in June/July, the vibrancy of Ukraine’s bur-geoning wealth is patent throughout the streets of its capital city, Kiev. Amidst scintillating fashion house boutiques and co-

pious black tinted luxury cars lining the main streets, it is hard to grasp that this country gained its independence from the Soviet Union a mere 21 years ago. Surely, such ostentations are a re� ection of Ukraine’s solid economic performance since 2000, with an average annual growth of more than 7%, up until 2008 when the global eco-nomic crisis hit the country’s � nances hard, demonstrated by a 15% contraction of GDP in 2009. Despite the severe blow to its economy, Ukraine has been recovering at a faster rate than its Western European counterparts with growth rates upwards of 4% in 2010 and 2011, partly boosted by the country’s accession to the WTO in 2008. But what has such rapid development done for the country’s healthcare? The blunt and disheartening answer is: close to nothing. This reality is even more distressing when you consider that Ukraine was once the scienti� c and manufacturing nucleus for all of the Soviet Union’s pharmaceutical needs. Yet, the situation has perhaps become so dire that a wave of change seems to be in motion and promise of a new healthcare ecosystem could soon become a reality. Welcome to the fallow pharmaceutical nation.

UKRAINE:

OPPORTUNITY BECKONS THE BOLDThis sponsored supplement was produced by Focus Reports.


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HEALTH AT YOUR OWN RISKWhen compared to the rest of the world’s life expectancy statistics, Ukraine ranks 116th, akin to some of the poorest Af-rican countries, with a dismal average life expectancy of 62 for men and 74 for women. This is exactly 100 positions lower than the country’s ranking in 1960 when, under the Soviet Union, health-care in Ukraine was universal and annual medical check-ups were mandatory for the entire population. Today, “Ukraine’s public healthcare is very limited and only supports � ve programs for major diseases, such as oncology, HIV, tuberculosis, dia-betes, transplantology, and rare children’s diseases. Treatment of any other health condition must be paid entirely by the

patient and this is something that they have gotten used to already,” explains Irina Gorlova, CEO of Support in Market Develop-ment (SMD), one of Ukraine’s lead-ing data research providers. In light of this, the govern-ment has been mull-

ing over the idea of introducing a reim-bursement system for more than 15 years.

Ironically, the reason behind such poor health indicators lies in Ukraine’s pharmaceutical expertise and manu-facturing prowess during Soviet times.

Oleksiy Solovyov, head of the State Ad-ministration of Ukraine for Medicinal Products (SAUMP), the country’s regu-

latory authority, recounts that “in the Soviet times many sectors of the economy, particu-larly the pharma-ceutical industry, were concentrated in Ukraine. Most academic institu-tions, which de-veloped drugs, as

well as manufacturing facilities, were lo-cated in Kiev and Kharkov. In that time the main purpose was to provide a wide range of products for the treatment of all major diseases, and increase the number of units produced. The objective of the USSR’s healthcare system was to provide a certain level of health.” Indeed, it was that legacy that led to the powerful group of private Ukrainian pharmaceutical producers that today account for almost 70% of all the units sold in the market, however in terms of value, the generic medicines manufactured by these compa-nies only add up to 30%. Nevertheless, Ukraine’s top 10 pharmaceutical com-panies in terms of value still counts four national producers, including Farmak at the No. 1 spot with a total market share of 3.8%. Farmak’s market share is also illustrative of the sector’s high fragmenta-tion with more than 100 companies mar-

keting their products in Ukraine. Vladimir Ignatov, executive direc-

tor of the Association of International Pharmaceutical Manufacturers (AIPM), explains that “the national healthcare system has not changed much since the days of the Soviet Union, under which the state was expected to pay for all national healthcare expenses. However, the reality of the situation is that today patients are paying for the vast majority of their treat-ment out of pocket (85-90%) because the government has ignored their role in regulating and streamlining the system, assuming that the private interests of the pharmaceutical industry would automati-cally do that. What has happened is that a large gap has been created between the performance of the pharmaceutical industry and the healthcare system, and this has caused some tensions between

the two.” Essentially, this has led to the stunting of the phar-maceutical sector in Ukraine, which to-day is valued at US $3 billion (SMD es-timates) for a popu-lation of nearly 46 million, bringing the average annual per capita expendi-ture on medicines

to a meager US $65 million. Under such conditions, Ukraine has amongst the low-est average prices for medicines in all of

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Oleksiy Solovyov, head of state administration

Vladimir Ignatov, executive director of AIPM

Irina Gorlova, CEO, Support in Market Development (SMD)



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Europe, driven mostly by a robust local generic industry that only began con-forming to international standards of production about seven years ago.

Viktor Poushkarev, head of the CIS Region for Finnish Orion Pharma, elabo-rates that “Ukraine holds the status of a branded generics market. An important

difference between the Western Euro-pean and Ukrainian branded generics market is the level of production control. We have very specif-ic generic competi-tion, in which prod-ucts containing the same API can come from production fa-

cilities with very different levels. This can in� uence the � nished product severely, with a tablet from one company contain-ing 40mg, a tablet from another producer containing 30mg, and the tablet of a third will contain nothing. Control on produc-tion facilities is still weak, even though Ukraine recently joined PIC/S in January 2011.” Orion has a clear understanding of the evolution of Ukraine’s pharmaceu-tical market due to Finland’s historical trade agreement with the Soviet Union, which allowed the company to be one of the � rst entrants into the market back in 1993. Poushkarev further explains that “healthcare expenditures from the state budget increase by 10-20% annually. Nevertheless, the quality of the health-

care has not changed in a positive way. This means that the main problems are still part of the system, which is under-standable as it is a tax-� nanced system.”

While the government does allocate about 10% of its budget to healthcare, SMD’s Gorlova explains that “public healthcare institutions in the country are antiquated and extremely inef� -cient, and this is represented by the fact that only 7% of the country’s healthcare budget is used to pay for the treatment of patients, while the remaining 93% is related to administrative costs.” Gor-lova used to head the operations of IMS Health in Ukraine before the company

decided to leave the market in 2003 due to a lack of access to quality data. In re-sponse to this, SMD has resourcefully struck partnerships with pharmacies that today willingly provide them with market data. “This kind of data was a necessity to develop the full potential of Ukraine’s pharmaceutical sector. In par-ticular, multinational pharmaceutical companies were demanding such data in order to make their forecasts and report back to their headquarters. Our aim was to support them in this endeavor by providing the same quality data and services that they are used to in other markets. In doing this, SMD also serves

Our innovations help millions of people by alleviating

their suffering and improving their quality of life.

We give them hope. In Ukraine and around the world.

Life writes the questions. We pursue the answers.

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Eugene Zaika, director, Nycomed Ukraine

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to promote Ukraine and the region as a great opportunity for investment,” she concludes.

One � nal hurdle that companies ex-perience in Ukraine is the prevalence of corruption stemming from the fact that

the pharmaceutical industry is a highly regulated sector with countless lay-ers of bureaucracy. Furthermore, state employee wages are unbearably low and therefore the temptation for them to make ex-tra money through

covert means is rather high. In fact, the circumstances were so blatant that the regulatory authority today contains an anti-corruption branch that employs for-mer secret service investigators to weed out tainted of� cials.

RECURRENT REACTIVITY REQUIREDUndeniably, most foreign pharmaceutical companies have had a rough time succeed-ing in Ukraine, � rstly because of the cut-throat competition that local players present, but more importantly because the country’s regulatory and legal environment can be as unpre-dictable as a night at the bingo. Yuriy Savko, executive director of the Association of Pharma-ceutical Research and Develop-ment (APRaD), explains that his association was created “to ensure that there was a transparent and trustworthy regulatory policy of the phar-maceutical sector. In Ukraine, regulations change constantly and at a very fast pace, which is why we need to be certain that all of these processes are transparent and involve all relevant stakeholders.”

It is true that over the last couple of years the pharmaceutical sector has seen

more changes to its regulation than in the previous decade, including for manufac-turing standards, price registration, cus-

toms clearance, and advertising restrictions. Some perceive this as Ukraine’s attempt to protect its national industry, similar to what Russia has done for itself. TEVA Ukraine’s general man-ager, Alexandra Sologub, claims that “the government tends to protect the interests of national pharmaceutical producers. Of course it’s a normal practice in any country, but by doing so,

the policies that are the most bene� cial for patients should be developed, not sim-ply obstructing the activities of foreign companies. In addition to this, there are constant changes of staff at the Ministry of Health, including the ministers them-selves. Under such conditions there can be no continuity for the country’s healthcare and pharmaceutical sectors, and this is one of the reasons why we see such low health indicators in Ukraine. Sure, there have been some steps forward, but they only represent pockets of development scat-tered throughout the system. In an ideal world we are all hoping that reforms take place, but realistically, I believe it will still take a few years before the authorities re-alize what they need to do and make it a priority on their agenda.”

However, others interpret the volatil-ity in regulation as a positive sign that the sector has now become a priority for the government and that � nally healthcare will be attended to by raising standards to Westerns European levels. Eugene Zaika, Nycomed Ukraine’s general manager, contends that Ukraine’s “regulatory envi-ronment is very much aligned with the Eu-ropean one. For many years we have had no severe problems related to regulatory approval and we are always in line with the nine-month registration term. As a matter of fact, the Ukrainian registration process is double the speed of that in Rus-sia, where it takes close to two years and local clinical studies are needed for ap-proval.” With a focus on cardiology and

Marina Simashova, general director, Unipharm Ukraine

Ala Ciobanu, general manager, Roche Ukraine

Orion is an innovative European R&D-based

pharmaceuticals and diagnostics company with

a special emphasis on developing medicinal

treatments and diagnostic tests for global markets.

Orion develops, manufactures and markets human

and veterinary pharmaceuticals, active

pharmaceutical ingredients and diagnostic tests.

The Group’s net sales in 2011 amounted to EUR 918

million.

Orion in brief

www.orion.fi

www.orionpharma.ru

www.orionpharma.com.ua

• Market access, promotion / co-promotion and sales of innovative products in therapy areas like

CNS, critical cardiology, infertility and rheumatology.

• Out-licensing, co-marketing of Orion’s OTC products authorized in CIS for pediatry, nasal and obesity

indications.

• Co-marketing / co-promotion models for Orion’s origin pharmacy cosmetics line and selected food

supplements brands popular in Nordic Countries.

• Out-licensing of broad range of authorized high level generic products in Russia and Ukraine in

cardiology, pediatry, oncology and neurology therapy aeas.

Potential cooperation areas in Ukraine, Russia and CIS:

Orion is interested in cooperation with local pharmaceutical industry in Russia and Ukraine, including

contract manufacturing, supply of bulk, in-licensed production with further promotion

of a products.

Finland 26%

Scandinavia 13%

Other Europe 34%

North America 14%

Other Markets 13%

Net Sales by maket area

Europe is the main market area

%

Specialty Products 35%

Animal Health 7%

Fermion 5%

Contract Manufacturing and others 3%

Orion Diagnostica 5%

Net Sales by business division

Largest divisions are Proprietary

Products and Specialty Products

%

Proprietary Products 45%

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neurology, Nycomed has achieved stun-ning growth in Ukraine and only expects greater results now that it is preparing to introduce Takeda’s complementary port-folio over the coming years and is con-

sidering localizing production of some products.

Rus s i a n -bor n Marina Simashova, general director of US-based Uni-pharm, believes that “although the challenges are similar to the ones Russia coped with,

Ukraine has its own approach to seeking solutions. The regulatory mechanisms that the Ukrainian government is work-ing on are not mere copy-paste activi-ties—Ukraine has its own way of doing business.” With the best-selling multi-

vitamin product in Ukraine and Russia, it is clear that Unipharm has learned to weather the adverse conditions of the Ukrainian market since it began its oper-ations in 2001, even through the � nancial crisis of 2008, when a handful of pharmaceutical companies went bankrupt. “In these mar-kets, challenges arise suddenly and frequently, and working in the pharmaceutical indus-try is like simultaneous chess: it requires managers to think about many possible challenges in advance,” adds Simashova. Furthermore, “Unipharm tries to contribute to Ukrainian healthcare reform through its experience in working in the American pharmaceu-tical industry. It is not possible to avoid all mistakes, and making mistakes is even important in the learning process, but we can certainly caution authorities about

speci� c mistakes and offer an overview through our experience.”

Roche Ukraine’s general manager, Ala Ciobanu, furthers this notion by stating that “we cannot implement the standard

marketing models that are used in other countries, because the regulatory and legal environ-ment in Ukraine is rather spe-ci� c and is constantly evolving. So we have to undertake special efforts to adapt to these condi-tions on a routine basis.” Over the last two years, Roche has restructured its local portfolio to focus on innovative products and diagnostics in anticipation

that, as average income rises, Ukrainians will increasingly demand the most mod-ern and effective treatments over stan-dard generic alternatives. “It was obvious that a copy-paste strategy borrowed from Western markets wouldn’t have worked

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Research and manufacture of pharmaceuticals.

20 years in Pharmaceutical Market

LEKHIM JSC 23 Shota Rustaveli Street,

Kiev 01033, Ukraine www.lekhim.ua

Ул. Шота Руставели, 23, Киев, 01033, Украина

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Viktor Poushkarev, head of CIS region, Orion Pharma

Alexandra Sologub, general director, Teva Ukraine



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Interchem: Ukraine’s Scienti� c Excellence EnduresBased in the port city of Odessa, Interchem origi-nated as a project con-ceived by � ve post-gradu-ate students at Ukraine’s National Academy of Sci-ences in 1989. At that time, Ukraine possessed the most talented scien-tists and chemists within

the entire Soviet Union, as they were the ones that drove the innovation of soviet medicines. Initially, Interchem produced chemical compounds out of makeshift facilities, where temperatures dropped to -12°C, and stumbled upon API production by chance to later formalize its manufactur-ing of pharmaceutical products in 2003.

“We gradually entered the pharma-ceutical area, as a producer of APIs due

to the fact that we were dealing with a lot of biological chemistry. APIs are still a part of our activity and this makes us quite unique from other producers in Ukraine. Due to our chemical back-grounds, we were discovering new com-pounds of APIs and strived to introduce new innovative products. Today, we have one of the best levels of � nished medi-cines production in this country and have GMP certi� cation,” recounts Ana-tolyi Reder, CEO of Interchem.

“Initially we were producing 100 mil-lion tablets a year. We very quickly mul-tiplied our production fourfold by 2007, working seven days a week, 24 hours a day, without any holidays. At that point we realized that we had to expand, so we halted production for � ve weeks for renovation, and when the workers came they were very impressed by the new facilities.” Reder remains modest in saying that “we are still a small to mid-size producer with 500 employees and a turnover of US $63 million. Our growth since 2003 has never been less than 35%, and in 2011 we even expe-rienced 42% growth. It is quite a hard task to keep the KPIs so high.” In or-der to do so, the company is currently expanding its facilities once again, with a total investment of approximately US $40 million. “We are adding four more buildings, one of which will be eight stories high, and overall the expansion will make our power four times of its current � gure. We will also have a new chemical building which will allow us to have GMP certi� cation for APIs. All the laboratory facilities will be under one roof, which is quite a task since they are currently all situated in different parts of Odessa.”

Even though the company today ex-ports to Georgia, Azerbaijan, and Rus-sia, they are counting on the Ukrainian market to drive the bulk of their future growth. “The only element missing which makes it more challenging is to set up the public opinion, which is formed both by the government and public associa-tions explaining to people that our quali-ty is equal to that of foreign companies,” concludes Reder.

Anatolyi Reder, Chairman of the Board and General Director, Interchem



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in Ukraine so we have been develop-ing our own methods in driving busi-ness here to ensure that our products are favored by the mar-ket. Because our products e s t a b l i s h high medical standards of t r e a t m e nt , they are dif� -cult to intro-duce to the market, espe-cially because all targeted drugs require p r o f o u n d diagnost ics

undertaken beforehand to ensure that the product would work. The ef� cient use of our innovative products also requires the high level of education from the side of doctors who prescribe the medicine,” explains Ciobanu.

Even though Roche undertook a renewal of its portfolio for strategic reasons, other companies have had to take more drastic measures to simply survive the ups and downs of the market. General manager of UK-based Mili Healthcare, Marina Sapo-zhnikova, tells of her company’s struggle to overcome the crisis of 2008. “Due to the crisis we were forced to adjust the objec-tives laid out in our 5-year plan because many of the distribu-tors in the country had serious dif� culties throughout the crisis, which created a very unstable environment for us. Out of � ve major distributors two of them went bankrupt, and overall dis-

tributors were not able to make purchases of great volumes because of the uncertain � nancial environment. This also forced us to lower our costs and limit our spend-ing, including by decreasing the number of staff. Starting in 2010, Mili Healthcare be-gan to reshape its portfolio by adding new products and restructuring the company’s operations according to new business units. Due to these drastic changes we are set to grow considerably for the coming years because we believe that the company is now prepared for such an expansion. In

2012 we will be looking to develop our � nancial performance and increase our market share with our revamped portfolio.” Even further, Sapozhnikova expects to place her company with-in the top 20 in three years’ time and would also like to replicate her strategies in Ukraine in other CIS markets, including Rus-sia. “I understand that these are very ambitious targets, but we have already been successful in the past with our strategies and expertise of the market, and therefore we are sure that we can perform above the average market growth,” she concludes.

The downside to adapting and testing new strategies is the risk that a new approach to business will fail. Surprisingly, this was the experience that Janssen lived in Ukraine when the com-pany diverged from its global practices to implement a unique local strategy a few years back. Charged with jumpstarting the company’s local operations, Vyacheslav Derbizh, Janssen’s re-cently appointed general manager in Ukraine speaks of the need to revert back to a strategy closer to the company’s global ap-proach. “Over the past two years, Janssen had unfortunately been losing market positioning in Ukraine. As a matter of fact, Janssen almost shut down its business here. This is unacceptable, considering Janssen is a part of the No. 1 healthcare company in the world (Johnson&Johnson). Therefore, since I took the job we have only set one aim, which is to be No. 1 in Ukraine! In order to do so, we have short-, middle-, and long-term goals. Concern-

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Courtesy of SMD

Leading Companies in Retail Segment by Value

Rank* August 2011

MS, %

Total market 100

2011

1 4,40%

2 4,40%

3 4,30%

4 4,20%

5 3,00%

6 2,90%

7 2,50%

8 2,90%

9 2,50%

10 2,50%

11 2,50%

12 2,10%

13 2,20%

14 1,80%

15 2,20%

FARMAK

SANOFI

MENARINI GROUP

NOVARTIS

NYCOMED

SERVIER GROUP

GLAXOSMITHKLINE

DARNITSA

ARTERIUM

BAYER HEALTHCARE

TEVA

KRKA

ZDOROVJE GROUP

HEEL

GEDEON RICHTER

Jean-Paul Scheuer, general manager of sano� Ukraine and Belarus



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ing our short-term goals, we are focused on building an organization and building a strong business. The middle-term aim is to become No. 1, and long-term is also to be No. 1 by building long-term relation-ships with the government, key stake-holders, and doctor associations. When looking at the market as a whole, one of the most important aims for the top in-ternational pharmaceutical companies is to establish a transparent and compliant environment and this is one of Janssen’s goals as well.” Indeed it has been up to the pharmaceutical companies to drive this sort of change in Ukraine, and over-all the sentiment is that the whole sector is cleaning up and raising standards to pro-vide better results, not only in business, but for Ukrainian patients as well.

GROOMING A NEW LANDSCAPEUkraine’s sheer size and low health indi-cators are testimony to a vast untapped potential that must be capitalized upon in the near future. As general manager of Sano� Ukraine, the leading foreign pharmaceutical company in the country, Jean-Paul Scheuer goes as far as claiming that “Ukraine is more European than we think, and I do not think there is another European country with such great poten-tial. A country like Poland, with a similar population and background, has already reached a certain level of development and a certain saturation of the market. For the next year, the Ukrainian economy is expected to grow 5%, which is consid-ered low. France would only dream of that percentage.” Nycomed’s Zaika asserts that “despite the fact that we have lost 20 years due to lack of government focus on the healthcare sector, there is still hope that the next government will decide on a good direction for the country. We need drastic reforms though, and at some point in the future, Ukraine will become a real European economy. Once that happens, those companies that are established here will bene� t greatly.” Indeed the coun-try’s accession to PIC/S in January 2011 was a bold step forward to regularize its pharmaceutical practices with global stan-

dards. Solovyov, of the SAUMP, af� rms that “this clearly demonstrates the con� dence of the in-ternational commu-nity in the system of state quality control of medicinal prod-ucts in our country, and the Ukrainian ability to build and

maintain this system according to world standards.”

Already there is a trend of foreign pharmaceutical companies deepening their presence in Ukraine beyond just commercializing their products. This is clear from the wave of representative of-� ces being turned into limited liability companies, the handful of marketing and manufacturing collaborations that have emerged between local producers and

foreign companies, as well as the inter-est in M&A oppor-tunities to buy out some of the local players. Perhaps the most obvious ex-ample of such col-laboration is that of Ukrainian manu-facturer Farmak,

the No. 1 company in the market in terms of value, with its end-stage production of Lilly’s recombinant insulin product. “In 2004 we began building the modern fa-cilities that would package this product, and the idea of the partnership was that it would deepen over time until it reached a full transfer of technology to Farmak from Lilly. This is why we invested great amounts of money into the installing the most modern and highest quality equip-ment under European standards,” asserts Oleg Syarkevych, business development manager at Farmak.

In the words of Vladimir Sayenko, managing partner of Sayenko Kharen-ko, the leading Ukrainian law � rm that widely advises the pharmaceutical sector:

Lyudmyla Borysova, director, Sperco

Tatyana Pechaeva, general director, Lekhim

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“There is de� nitely a trend for the lo-cal industry to ‘clean up’ in order to be more attractive. Moreover, we have seen

the legal framework being gradually im-proved to attract foreign investors. Yet the major coun-try risks remain the same: inconsistent application of the laws by various regulators, corrupt judiciary, and weak enforcement. How-ever, these risks pay off with the much

higher yields on investment than else-where in the developed economies.”

The possibility of acquiring or part-nering with a local producer is even being considered by mid-sized regional players,

such as Turkish � agship Nobel Pharma. Cem Demirci, general director of Nobel Ilac Ukraine, speaks about the prospect of forging a partnership with a Ukrainian manufacturer: “We are always discussing this with our headquarters because a country with a population of 46 million inhabitants de� -nitely has great opportunities. Of course the government will always favor local production which is why it is essential for us to consider such part-nerships for the future, when Ukraine will have a stable po-litical and economic system.” Nobel already has vast experience in the CIS region, having established the � rst GMP-certi� ed plant in Kazakhstan and another manufacturing site in Uzbeki-stan. “I think that Ukraine is the market

with the most perspectives within the CIS region. Indeed, there are a lot of market-ing restrictions in markets such as Rus-

sia, Belarus, and Kazakhstan, whereas Ukraine is very liberal on this. But I still believe that Ukraine needs some time,” con-cludes Demirci.

The call for reforms almost unanimously involves a push for the government to implement a reimbursement system that would bene� t both the pharma-ceutical industry and Ukrainian patients. It has been 15 years since Ukrainian authorities have been debating the issue of reim-

bursement, yet nothing had been done until 2011, when � nally four pilot proj-ects were executed in different regions of the country, as part of a plan that would bring reimbursement by 2014. Granted

Alexander Golovnya, head of representative of� ce, Lundbeck Ukraine

Cem Demirci, general director, Nobel Pharma Ukraine

Mili Healthcare Ltd. Great Britain is a

pharmaceutical company that has been

cost-reasonable treatment in Ukraine since

2002. Our operations in rapidly growing

Ukrainian market are based upon broad

experience and high standards of British

healthcare.

www.mili.ua

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Darnitsa

Trusted medicines in Ukraine

Papka.indd 1 17.02.2012 13:31:10

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Darnitsa: Leading by ExampleThe most radical changes to Ukraine’s pharmaceutical sector are witnessed within the headquarters of some of the � agship national producers. Darnitsa is not only the leading Ukrainian manufacturer in terms of units sold, but is also the company that is undergoing the greatest overhaul of its operations to pro-fessionalize itself under international standards. Having taken over from his father as CEO of Darnitsa in 2009, Glib Zagoriy ex-plains that “we wished to restructure our business to make it as professional and competitive as possible. At some point we real-ized that the Ukrainian pharmaceutical companies, while very powerful in the local market, are not interesting for Big Pharma for a number of reasons.” Referring to the multiple challenges of the local market, Zagoriy feels that Ukrainian companies remain bound to their soviet legacy and are therefore incapable of truly competing at a global level.

Perhaps more importantly, Zagoriy wishes to demonstrate that Ukrainian companies can be competitive while being fully transparent and ethical. “Up until 2011, Darnitsa was focused on � nishing its CAPEX project that essentially transformed our plant from an old soviet factory into a modern pharmaceuti-

cal production site under GMP standards. The project was developed together with a Swiss company in 2000 and it has taken us 11 years to complete. In parallel to the CA-PEX plans we have also been restructuring our � nances in order to become a debt-free company, which is where we stand today. This required that we learn how to be audited by international auditing companies like PWC, and to make all of our structures and pro-cesses fully transparent,” he emphasizes.

Even though this restructuring is bound to attract potential buyers, Zagoriy af� rms that the family has no intention of sell-ing the company anytime soon, given that Ukraine’s pharma-ceutical sector is only at its infancy and the company wishes to be a part of its full blossoming. Furthermore, he advises that for “those companies that wish to grow through acquisitions, make sure that you are present here today so that you can learn how the market functions and what you need to do in order to be successful.”

Glib V. Zagoriy, CEO, Darnitsa



Ukraine Report






Ukraine Report

that these projects are mostly geared towards restructuring healthcare insti-tutions in their respective regions, they are nevertheless the initial step to gauge how ef� ciently reforms can be carried out and what their true bene� ts may be. In terms of economic growth for the pharmaceutical market, the bene� ts of a reimbursement scheme are more than evident with estimates that the value of the market would double af-ter such a move. “I think that a reimbursement system will be implemented in three years, and this is of course crucial for the improvement of the lives of the patients and to create even more opportunities. Indeed, this is neces-sary and inevitable,” argues Demirci.

Others are more skeptical about the certainty of reimbursement. Alexander Golovnya, general manager of Lundbeck Ukraine, considers that even though some steps have been taken in the direction of reimbursement, there will be no real ac-tion in the near future. “I do not expect this to happen soon. This year parliamen-tary elections will take place, so we do not expect that the government will make any major changes before or shortly after these elections. However, I hope that a state reimbursement system together with a private insurance system (once estab-lished) will give patients broader access to modern ways of treatment,” he says. As a company that focuses entirely on CNS dis-

orders, for which there is no state funding, Lundbeck has been paving the way to de-stigmatize neurological conditions, such as depression and bipolar disease. “Another challenge is to change doctors’ mentality of prescribing cheaper products to their

patients since they worry about their patients’ spending pow-er instead of thinking about drugs’ safety and ef� cacy,” says Golovnya.

Within this debate, it is the Ukrainian companies that are most optimistic about the pos-sibility of a reimbursement system and take the govern-ment’s initiatives as credible efforts to move in the right

direction. Tatyana Pechaeva, general di-rector of Lekhim, is con� dent in saying that “we cannot wait any longer with the introduction of these reforms, and I am con� dent that they will � nally be passed. We will have to see in what form and quality they will come, but at least the � rst brick has been laid. Reimbursement and medical insurance are connected to many other questions from which they cannot be seen separately. If we look at the reimbursement system for instance, it cannot go without production; pro-duction cannot go without science; and science cannot go without education. I hope the authorities fully understand this and tailor their reforms to the complexi-ties of the healthcare system.” With two manufacturing sites and as the 11th most

important Ukrainian producer, Lekhim today is focusing on growing its local operations rather than on exports to CIS markets, which had been its main driver throughout the 1990s. Ever the enthusiast and a � rm believer in her home market, Pechaeva asserts that “if we follow this development path, we will be among the top � ve in three years!”

Overall, as local companies experi-ence increased pressure from their foreign counterparts, they have also been driv-ing the wave of change within their own ranks, and have been lobbying authorities

to move toward in-ternational stan-dards of regulation. Sperco is currently reconstructing its manufacturing fa-cilities to establish full GMP compli-ance for all of its operations. “So far we have been able to reconstruct about one third of

our facilities under GMP standards and expect to complete another 25% by the end of 2012. We expect to complete the entire project by the end of 2013 or begin-ning of 2014. Aside from the GMP mod-ernization project, we also have expan-sion plans that involve the construction of new warehouses and of� ce buildings and this will be carried out over the next � ve years,” says Lyudmyla Borysova, di-

Vyacheslav Derbizh, country manager, Janssen Ukraine

Nataliya Sapozhnikova, head of the representatives, Mili Healthcare

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Ukraine Report



rector of Sperco. This expansion plan is also indicative of investor con� dence in the potential of Ukraine’s pharmaceuti-cal market, considering the Sperco was created under Spanish capital. In light of this, Borysova is aware of the need to “convince others to invest in Ukraine and to get over their fears of the chal-lenges that this market holds, because ultimately the opportunities are much greater than the hurdles along the way.” Furthermore, Borysova is proud to point out that “our modern manufac-turing facilities were the beginning of the industrialization of the Vinnytsia region, as it later attracted other industrial proj-ects once we had proved that it was pos-sible to � nd quali� ed professionals in the region for these kind of activities.”

Some investors have already heeded to the lure of Ukraine’s latent potential by acquiring or setting up manufacturing facilities. Bulgarian � agship Sopharma acquired a plant in 2008 which they are

currently modernizing to meet GMP standards. “The main reason to acquire a plant in Ukraine, in addition to the So-pharma plant in Russia, was to have an additional platform within the company to provide the entire CIS region. Another rationale for Sopharma to pick Ukraine for its production facility is the impor-tance of this market. Ukraine was very important at the time of the acquisition in 2008, and the growth potential of the

Ukrainian market remains impres-sive,” concludes Igor Gerasymchuk, head of representative of� ce of So-pharma Ukraine. In fact, Ukraine’s promising future and efforts to im-prove the overall business environ-ment of its pharmaceutical sector are also beginning to sway some of the world’s leading companies. Jos-tein Davidsen, Nycomed’s head of emerging markets, justi� es the com-pany’s plans to set up manufacturing in Ukraine by explaining that it will

“increase the access of our products for patients and provides us with greater � ex-ibility in terms of logistics and distribu-tion. It would never make sense for us to establish manufacturing simply because of government policy. We have to do it because we believe in it and believe in the future of this market.” For the sake of Ukrainian patients and the country’s development, it is nice to think that they are not the only ones who believe so.

Over the last half-century, we have brought together a family of

innovative pharmaceutical companies all with one overarching

mission: to address and solve some of the most important unmet

medical needs of our time.

Janssen companies are focused on developing groundbreaking

treatments in five major therapeutic areas: Neuroscience, Infectious

Diseases, Oncology, Immunology, and Cardiovascular/Metabolism,

and our product portfolio addresses other critical areas as well.

We are people helping people - we work closely together to harness

our combined knowledge and resources, leverage the power and

promise of outstanding science, and enhance the length and quality

of life for people throughout the world.

At Janssen, we passionately pursue science for the benefit of

patients everywhere.

Representative office of Janssen PharmaceuticalsG. Skovorody Street, 19 Business center « Podol Plaza », Kiev, Ukraine

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Sperco — Manufacturing of Liquids



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Ukraine Report

iNtErviEW With: Vladimir Ignatov - Executive Director - Association of International Pharmaceutical Manufacturers (AIPM)

What was the market need that spawned the creation of AiPM in 2009? What was the vision for this associa-tion?The idea of establishing AIPM origi-nated much before 2009 and it is something that international phar-maceutical companies in Ukraine had been speaking about for many

years prior. Essentially, the element that was lacking back then was a truly professional association that could represent the interests and needs of international pharmaceutical and would lobby government authorities to defend those interests.

What are the main priorities on your agenda today?There are things that we hope will change yet know that re-alistically that will not happen, and then there are things that we are certain can change and we can have a direct impact on. In terms of the latter, we are very actively working with the authorities in developing a concept for a reimbursement sys-tem and hospital supply. The problem is that any reform must be funded and today such funds have not been allocated by the government. The idea is that employers will bear the initial burden of health costs, a sort of 7% tax on the employee’s salary, with a progressive shift of this burden onto the em-ployee over the years. While this might be an effective model under normal circumstances, the problem is that in Ukraine it is estimated that between 30-40% of salaries are paid unof-ficially because businesses cannot afford the level of taxation imposed by the state.

Realistically, our main objective is to ensure that a positive business environment is maintained for the pharmaceutical sector, including in terms of regulation, competition and the protection of the industry’s assets.

What kind of relationship and cooperation ex-ists between the pharmaceutical industry and the government in order to act upon such re-forms?One thing that you must understand is that there is a grave lack of continuity in the policies and strategies of healthcare authorities. As a clear example, in 2011 alone we have already had three different ministers of health, and it is likely that a fourth will be appointed before the year’s end. A new minis-ter means a new healthcare team every time, and each team brings along with it its own ideas as to how reforms should be implemented and therefore the process tends to start from scratch every time there is a change. This is highly unproduc-tive for the country and it creates a stagnant situation in terms of following through with healthcare reforms.

What are the specificities of the Ukrainian pharmaceutical market that are have shaped AiPM’s objectives since its creation?The Ukrainian pharmaceutical market has historically had one key problem, and that is that the government has had a very

realistically, our main objective is to ensure that a positive business environment is maintained for the pharmaceutical sector



Ukraine Report




hands-off approach to the sector. Since the independence of Ukraine in 1991, authorities have always considered the sector to be completely private throughout the entire value chain, including from R&D and manufacturing to the distribution of products. This has created a very powerful local industry that today is estimated to produce 2 out of 3 products sold in the market and is, for the most part, privately-owned. While this is advantageous in a business sense, the Ukrainian government has failed to understand that the pharmaceutical sector is an essential part of the country’s healthcare system, which requires the full engagement of the sector in order to create an efficient system. The national healthcare system has not changed much since the days of the Soviet Union, under which the state was expected to pay for all national healthcare expenses.

Today there are great opportunities for growth in the Ukrainian pharmaceutical sector, particularly under the new discussion of healthcare reform and the introduction of a reim-bursement system and improving hospital supply. This would drastically increase the consumption of prescription medicines and the overall value of the Ukrainian pharmaceutical market. At the moment, prescription medicines represent 50% of the total market value, with OTC fulfilling the other 50%, mainly because the patient is main payer. At least 85-90% of the mar-ket value today is funded directly by the patient, which conse-quently means that patients rarely obtain medicaments from a doctor or hospital but rather purchase them directly at phar-macies. The upside to the situation is that prices in Ukraine are generally lower, both for OTC and prescription products, than those of neighboring markets, so treatments are more afford-able for the patient.

Considering that there is minimal purchas-ing of medicines on behalf of the government, what are health expenditures allocated for in Ukraine and what is the general cost structure of the sector?The main health expenses for the Ukrainian government to-day are by far administrative costs and salaries for public em-ployees. Many of the hospitals and buildings used within the healthcare system are quite old and, therefore, have extremely high maintenance costs that eat away at the country’s health budget. Sadly, only 10% of national health expenditures is al-located for the treatment of patients and purchasing of essen-tial medicines, such as vaccines and for the treatment of tuber-culosis, oncology and HIV. The Ukrainian healthcare market is calculated to stand at around UAH 25billion in year 2010, with UAH3.5 billion representing total expenditures by the govern-ment, out of which only UAH 1billion is allocated to the MOH centralized purchasing of medicines and UAH 2.5 billion for the regional administrations.

Furthermore, doctors and healthcare professionals in Ukraine are one of the lowest paid employees in the country and in the world when you consider the country’s GDP. It is estimated that the average salary for a doctor is $200, which is clearly unsustainable when you consider the average cost of living in Ukraine. As a consequence of this, there is a certain percentage of unregulated health expenses that are related to the payment of doctors to obtain preferential treatment, which you might consider as a gray market, or maybe even a black market.

What do you expect to see in 2-3 years time in terms of the Ukrainian pharmaceutical market and the achievements made by AiPM?We expect to have a much better situation with market con-ditions, beginning with improvements of product registration and quality control. This is particularly true with the recent ac-cession of Ukraine into the PIC/S agreement that will bring about many improvements on these two fronts, particularly for quality control that today can range widely in the country, which can be a threat to patients and also causes unfair com-petition in the marketplace. We also expect healthcare reforms to push through with decentralization of state purchases and a functional reimbursement system. The key is to ensure that the government truly believes in these reforms and to have them allow for full transparency for the market to regulate itself.

today, there are great opportunities for growth in the Ukrainian pharmaceutical sector, particularly under the new discussion of healthcare reform, the introduction of a reimbursement system and improving hospital supply



Ukraine Report

AFvU is the only associa-tion representing Ukrain-ian pharmaceutical com-panies and today it counts on a membership of manu-facturers responsible for 90% of national production. What was the aim of creat-ing such an association?In 2005 we created this associa-

tion with the main goal of adopting European standards for Ukrainian manufacturers of pharmaceutical products. The idea was to standardize the processes of the local industry so that our medicines would be acceptable to commercialize in all of Ukraine and eventually in other markets as well. As of 2010 GMP standards became obligatory for all Ukrainian producers to obtain a license for a product and this was due to the ef-forts our association that is known as the Association of Manu-facturers of Medication of Ukraine. Today our main goal is to prepare the market and healthcare sector for the introduction of a reimbursement system and health insurance operators.

At the moment we only represent six of the largest com-panies in Ukraine, but we are in the process of expanding our membership because ultimately we would like to have all national manufacturers motivated by the same vision of our healthcare and pharmaceutical sectors. There is no doubt that the Ukrainian pharmaceutical sector has great potential, and it has already been growing at 20% on a yearly basis. Given that the market is only valued at US$3 billion and the country’s population is 46million, there is great room for improving and growing the importance of the sector. What is needed now is to transform the healthcare sector in order to make these op-portunities a reality.

Authorities have been debating about the in-troduction of a reimbursement system for more than a decade now. Do you believe that

this will soon become a reality?Yes, I am confident that soon the government will introduce a reimbursement system and this is one of our principal objec-tives. We have been working in close cooperation with the Ministry of Health to ensure that the appropriate steps are taken to create an environment in which a reimbursement sys-tem could become a reality. This means updating regulations and standards of medicine as well as understanding where the government needs to allocate more funds in order to improve the provision of healthcare. For all of this to become a reality there is a need to better understand the statistics of diseases in Ukraine to therefore understand the amount of medication that will be needed. Such data is helpful not only for the gov-ernment’s planning purposes and the patients, but also for us manufacturers to understand which products we need to focus on and how to improve our cost structure.

it sounds like you have very ambitious goals for the future. What do you consider have been the main milestones and achievements of AFvU so far?Undoubtedly the greatest achievement for us was the estab-

iNtErviEW With: Petru Bagriy - Executive Director - Association of Manufacturers of Medication of Ukraine (AFVU)

Ultimately, we would like to have all national manufacturers motivated by the same vision of our healthcare and pharmaceutical sectors



Ukraine Report




lishment of GMP standards as the norm and the fact that we were able to achieve this only in our 5 years of creating the as-sociation. This guarantees the safety and efficacy of our prod-ucts for patients while also creating an equal manufacturing benchmark for all companies to abide by. A clear sign that we are moving in the right direction was Ukraine’s accession to PIC/S in January 2011 as this was part of our lobbying agenda that we devoted much effort to.

While Ukraine offers a number of opportunities for the pharmaceutical industry, there are still a number of challenges that need to be over-come. What do you consider to be the greatest hurdles for national pharmaceutical compa-nies today?The main challenge is the lack of standard treatment and pro-tocols in our healthcare system. The Ministry of Health has not been very active in creating such guidelines and therefore doctors are free to prescribe medicines as they see fit. Under

such conditions, and given the very low salaries of health prac-titioners, doctors are very easily influenced by advertising as opposed to concrete medical data.

Perhaps another challenge involves the VAT on imported medical and manufacturing equipment that is extremely ex-pensive here in Ukraine. Local companies have no choice but to import such machinery because there is no local producer of such equipment. If we manage to have this tax exonerated then we will be able to provide the same high quality medi-cines at much more affordable prices for our patients.

Finally, another obstacle that we have been working to im-prove is related to logistics and distribution regulation that is dictated by the Law of Medicines that was written in 1996. The law today has become very outdated and we are also discuss-ing with governmental authorities to review the law so that it facilitates the distribution of medicines. One example of why this law should be reviewed is its Article 17 that concerns the importation of non-registered substances for pharmaceutical

development. Under this article any substance that is not regis-tered is simply not allowed into the country, which means that we are very limited in developing new pharmaceutical products because we cannot import the necessary raw materials. We spent one year to have this provision amended and finally we managed to have it reversed. Another article that we should be amended is that concerning the development of pharmaceuti-cal products that are still under patent.

Finally, we are also working to simplify the process of price registration for medicines which at the moment is unclear and very complex. The current requirements are also unequal for foreign and national manufacturers, so we would like to stand-ardize the procedure for all pharmaceutical companies operat-ing in Ukraine.

Considering that Ukrainian pharmaceutical companies are so successful in their national market, what plans does the industry have to internationalize and push beyond its own bor-ders?Yes, indeed this is what we are undertaking at the moment. As you might be aware, Ukraine was the most important producer of pharmaceuticals during the USSR, which is why today we are exporting to most of our neighboring markets. Ukrainian companies today are exporting to Russia, Kazakhstan, Geor-gia, Armenia, Belarus, Moldova and also the Baltic states. The next stage is to sell our products to other EU markets, such as Germany, Romania and Poland. At the moment the biggest national manufacturers are already exporting about 20% of their production to other markets.

how do you see the Ukrainian market evolving in five years’ time?This is a dynamic market that still needs to be organized ap-propriately by following the highest global standards of health-care, but for sure it is will develop itself fully in the coming years.

Ukraine was the most important producer of pharmaceuticals during the Ussr, which is why today we are exporting to most of our neighboring markets

Undoubtedly, the greatest achievement for us was the establishment of gmP standards only in 5 years of creating our association



Ukraine Report

Following takeda’s acquisi-tion of Nycomed earlier this year, how has the transac-tion affected your opera-tions in Ukraine and what synergies were generated by it?Regarding the integration process, we are adapting our corporate cultures as quickly as possible. Luckily, I found

out that both our cultures are very similar. It is a perfect match, which means that our people don’t have to go through a dif-ficult process to adapt to a new culture.

As for the effects of the integration, I only see opportuni-ties ahead. Takeda’s portfolio provides Nycomed with access to a number of the best products in the world in which a lot of research has been invested. We are already well established in the CIS in cardiology, endocrinology, and diabetes because of our partnership with Merck, but the Takeda products provides us with even more opportunities. An additional advantage is that we don’t have to adapt the sales force structure to gain more expertise in new therapeutic areas; basically we are al-ready there. One area in which we will have to develop our competence is in oncology.

As soon as we get approval authorization of the new prod-ucts in the country, we will be able to launch them and provide access to modern therapies for patients. Overall, we are truly excited about the new opportunities. Takeda’s acquisition is the best that could happen to Nycomed Russia - CIS at this point.

As you mentioned earlier, the CiS and russia are priorities for Nycomed and are expertise ar-eas for the company. how has Nycomed been performing locally in terms of growth and mar-ket share?Back in 2005 we were ranked number 21 in Ukraine, while

today we are #5. We used to be a small and forgotten com-pany, and today are very proud of the achievements made by our management team in Ukraine given the impressive turna-round of the company locally. The market split in the country is 18% hospital, 82% retail, and in the retail segment we already ranked #4. As regards our market share, we are aiming to reach 3.4% share in retail, and 3.9% for hospital. In the end of 2011, we will most probably be close to 3.5% for the total market, having started from 1.1% in 2005.

In regards to Nycomed’s growth, we have been constantly delivering double digit growth. On the other hand, this suc-cess level also means that it is very difficult to push further, and our portfolio was about to run out of speed. Nonetheless, our growth for this year is still impressive, with 27% growth in volume compared to last year.

With such growth figures, is Nycomed consid-ering investing in the Ukrainian market, for in-stance by acquiring a local company in order to localize production?Localization is very much in line with both Nycomed’s and Take-da’s strategy. My direct boss, head of Russia and CIS region, Mr. Jostein Davidsen, has always stressed that to become truly successful and gain a strong foothold, the company needs to establish local production.

At first glance, when you consider the peculiarities and legal environment of Ukraine’s pharmaceutical sector, it might seem

iNtErviEW With: Eugene Zaika - Director - Nycomed Ukraine

with a winning mentality and passion, you can be successful in Ukraine



Ukraine Report




very risky to consider direct investment. When reimbursement is introduced, however, these kinds of investments are essential to be well-positioned and ready to capture all the opportunities that the market has to offer. Healthcare reforms and reimburse-ment will inevitably occur at some point, and we are preparing ourselves for when the moment arrives.

Setting up localized production makes a company more flex-ible in terms of logistics and distribution, and also allows us to bring value to the country. Nycomed does not plan to bring out-dated technology and manufacturing to Ukraine, on the con-trary: a possible production facility would be state-of-the-art and would even further increase our attractiveness as a partner. Partnerships are at the core of Nycomed’s strategy in emerging markets, and this is something that Takeda also values. Among Nycomed and Takeda’s fourteen partners are General Electric, Biogen-IDEC and E.Merck KgA. Finally, local production will also grant us more opportunities due to the increased political influ-ence that it will provide us. We are here for the long term and we are ready to share our expertise and technology.

Considering the extensive list of partnered products that you market locally, what makes you the partner of choice today? First and foremost, it is our successful track record that makes us the partner of choice. We have been successful with all partner products because it is in the mindset and culture of Nycomed to drive them forward. We never treat partner products differently from ours and neither does our sales force. On the contrary, we put our full power and passion behind these products to make sure they succeed.

there are a lot of different opinions on the gov-ernment’s plans to improve the conditions in the pharmaceutical sector. What is your per-spective? Three months back I would have been more positive, but I have seen some negative trends recently. Just one week ago, for ex-ample, a new regulatory procedure for registration of products was introduced. It includes a clause stating that even compa-nies that produce their medicine in PIC/S countries have to pro-vide an additional document for re-approval and recertification of products by the local pharmaceutical inspectorate. Luckily, there are also some recent positive signs. Overall, I would say that the regulatory environment is very much aligned with the European one.

Given all of these market peculiarities, what would be your advice to a newcomer to the

Ukrainian market, given your success in under-standing the market and performing so well?I always tell foreign companies that a strong foothold requires either a Ukrainian manager or an expat with broad experience in Ukraine. A new expat would need a lot of time to understand the market and build up a network of contacts, which is essen-tial in this country. Even a genius, without knowing the right people to assist him, would not succeed in Ukraine.

A foreign company looking to enter the Ukrainian market has to have a passion for business and the mindset of a fighter. Competition in this market is very tough – even Russians who come here and see the number of companies ask us how we succeed in making it here. There are 600 companies in the mar-ket, of which 420 are active and providing 14,000 approved medicines. Entry restrictions are very low for generics and on top of that, the local industry is very strong – a heritage from the Soviet Union, when the pharmaceutical industry was lo-cated almost entirely in Ukraine. Nowadays, there are six local companies in the top 20, including the #1, Farmak, a company which is very advanced: they provide competitive packages and are very powerful in marketing.

What is your final message regarding the Ukrainian pharmaceutical market?Ukraine is like a coin. On one side, there are a lot of negative elements that you read about in the media all the time. On the other side, this is a country with real potential; double digit growth for years and a large population. Despite the fact that we have lost twenty years due to lack of government focus on the healthcare sector, there is still hope that the next gov-ernment will decide on a good direction for the country. We need drastic reforms though, and at some point in the future, Ukraine will become a real European economy. Once that hap-pens, those companies that are established here will benefit greatly. Finally, I would like to say that until then we should not be afraid – with a winning mentality and passion you can be successful in Ukraine.

Healthcare reforms and reimbursement will inevitably occur at some point, and we are preparing ourselves for when the moment arrives



Ukraine Report

iNtErviEW With: Glib Zagoriy - CEO - Darnitsa

Considering you only took over as CEO from your fa-ther in 2009, what was the mandate that was given to you as new CEO of the com-pany - including your objec-tives and strategy?Darnitsa has been a private family company since the time of Ukraine’s independence, when my father be-

came the manager of the company. I have been working at Darnitsa for 15 years and began my career here as low-level manager, slowly moving up the ranks until I became CEO. The reason why we have made such changes to our management stems from the fact that we wished to restructure our busi-ness to make it as professional and competitive as possible. At some point we realized that the Ukrainian pharmaceutical companies, while very powerful in the local market, are not interesting for big pharma for a number of reasons.

The first reason regards the legislative framework of Ukraine’s pharmaceutical sector, which is not clearly defined and at the same level as those in developed markets. Over the last couple of years the situation has been improving greatly, with the State Administration of Ukraine of Medicinal Prod-ucts headed by Mr. Solovyov, taking a very aggressive stance to reform the regulatory legislation. Proof of these renewed efforts is Ukraine’s accession to PIC/S in January 2011. At the moment this work is still in progress, but we expect that within the next two years our state regulator will be successful in rais-ing the national standards according to those used in Europe.

Another factor why Ukraine remains an unattractive mar-ket for big pharma is due to the country’s low expenditure per capita on medicines. There is also the issue of currency risk and the large amount of imported medicines in Ukraine, which represent about 70% of the total market’s value. Fur-thermore, some market research companies estimate that

Ukraine’s pharmaceutical sector today is valued at US$3 bil-lion and that it will grow 16% this year, however I am not so optimistic about these figures. Having conducted our own research, we find that the numbers are actually lower and that the total market value actually stands closer to US$2.6 billion and that real market growth is approximately 11%.

Finally, the last cause behind our restructuring is related to our own internal ambitions for the next two years and how we see ourselves in the market. During the last four years there have been rumors that Ukrainian manufacturers were of high interest to foreign pharmaceutical companies in terms of M&A activities. This does not reflect the reality of the situation though.

What have you accomplished so far and where do you stand today with your efforts to reform Darnitsa?Over the last two years my goal has been to break this soviet

culture within

we have found that Ukrainian employees are resistant to change, and most of them are even afraid to learn to work with new technologies



Ukraine Report




the company and even change the processes that my father had instituted here at Darnitsa. At the end of the day busi-ness is business and I have to do what is in the best interest for the company, even if personally this has been the great-est challenge for me. No other Ukrainian company has begun such a process of reform within their ranks and surely it will be the most difficult task for them when the time arrives. We have found that Ukrainian employees are resistant to change, and most of them are even afraid to learn how to work with new technologies. It would be a waste of time to try and force people to change, which is why I have decided to renew ap-proximately 50% of the staff at Darnitsa and to attract external talent.

Up until 2011 Darnitsa was focused on finishing its CAPEX project that essentially transformed our plant from an old so-viet factory into a modern pharmaceutical production site. The project was developed together with a Swiss company in 2000 and it has taken us 11 years to complete. In parallel to the CAPEX plans we have also been restructuring our finances to become a debt-free company, which is where we stand today. This required that we learn how to be audited by international auditing companies like PWC, and to make all of our structures and processes fully transparent. Furthermore, implementing such processes is also in line with our aim to become an attrac-tive partner for other pharmaceutical companies.

With so many ongoing changes is your final aim to sell streamline the company so that it may be bought out by big pharma?We are not looking to sell our company any time soon. Ukraine offers great opportunities as a market and we wish to be here at that time when those will be fully developed so that we may capitalize on them. Ukraine has yet to see the next stage of its development, and only then will big pharma truly become interested in this market. Our philosophy is that we would like to be the most attractive partner for such companies when the time arrives and this is what I would like to achieve until then.

What could we expect from Darnitsa and Ukraine in the next five years then?If everything goes as planned, our family will still be heading Darnitsa but with a greater percentage of young and talented personnel. I also expect that we will have achieved an 18-20% market share in terms of units sold in the country. This will be the company that has established an important 3-5 year partnership with big pharma, in contract manufacturing, pack-aging or co-marketing. I wish to have my personnel be very educated in the practices of western companies and this will be achieved through such a partnership. In five years we might

have also expanded our production facilities and maybe even began to explore the biosimilar sector, even though this would represent a colossal investment for us.

Do you have a final piece of advice to foreign-ers coming into the Ukrainian pharmaceutical market?This is a very interesting market in terms of the opportuni-ties it presents, but today it is too early for managers of the great pharmaceutical companies to come to Ukraine as it is still only a market of US$3 billion. To those companies that wish to grow through acquisitions, make sure that you are present here today so that you can learn how the market functions and what you need to do in order to be successful. In order to save time I recommend that this be done through collabora-tion with local manufacturers. Finally, no one should fear the Ukrainian market, especially because our regulations are evolv-ing very quickly and improving every year.

Ukraine has yet to see the next stage of its development, and only then will big pharma truly become interested in this market



Ukraine Report

iNtErviEW With: Viktor Poushkarev - Head of CIS Region - Orion Pharma

As the head for Ukraine and the CiS region, could you please tell our readers how Orion views this re-gion in the company’s over-all strategy and specifically how Ukraine fits in?Orion Pharma is a European com-pany whose main platform of opera-tions is innovative products. Several

molecules like levosimendan are globally available. We focus however on Europe including the CIS region, where we have our own organizational structure.

Out of the BRIC countries, Russia is the only country where we are fully active. This influences the character of the compa-ny. We understand the importance of the CIS markets where consumption is still growing and has serious potential, where-as in the Western European countries, growth is flat and stag-nating. The company was actually one of the key investors in the pharmaceutical industry during the Soviet Union, because of a special trade agreement between the Soviet Union and Finland. Two years after the collapse of the USSR, in 1993, we entered Ukraine. Orion in Ukraine is a company that has very strong positions in several niches. The idea is not to become the biggest player in the market, but to become strong in several therapeutic areas in which we excel. We offer unique products for cardiology, central nervous system, oncology, and neurology to the Ukrainian market, and on top of our original products we offer several generic products.

Several particularities of market development should be taken into account when doing business in the CIS. Besides the great growth numbers, the region has more severe eco-nomic fluctuations than Europe. Currently we see GDP growth slowing down even in Ukraine. There has been a fast recovery after the crisis, but given our dependency on energy import and global metal and iron prices, we are very sensitive to de-

velopments outside of our control. Another factor to take into account in Ukraine is the huge

gap between real pharmaceutical consumption and real medi-cal needs. If we compare the figures of pharmaceutical con-sumption per capita in Ukraine with the poorest European Union (EU) country, consumption is two to three times lower here. There is a lot of improvement possible in this huge mar-ket where there are too many unmet medical needs both in individual consumption and financing of public healthcare.

in growing Orion’s business in Ukraine, what has been your strategy to penetrate the market to ensure that Orion became a top performer in its niche segments?The first element was the fast market realization of assets of our original products. We managed to provide unique prod-ucts to Ukrainian patients, most notably for the treatment of Parkinson’s disease, prostate cancer, acute heart failure, and breast cancer. We also offer a number of our generic prod-ucts. This combination makes us a more sustainable partner for medical professionals.

the idea is not to become the biggest player in the market, but to become strong in several therapeutic areas where we excel



Ukraine Report




Specifically how do you see the Ukrainian mar-ket evolving, also regarding the appreciation for innovative products and valuing the re-search behind it? Ukraine holds the status of a branded generics market. An im-portant difference between the Western European and Ukrain-ian branded generics market is the level of production control. We have very specific generic competition, when the products containing formally the same API coming from production fa-cilities with very different levels. Control on production facili-ties is still weak, even though Ukraine recently joined the PICS.

Of course Ukraine is a generics market, but there is demand for high-quality innovative products from doctors and patients, even if they sometimes have to pay it out-of-pocket. The doc-tors follow less the old guidelines designed during the Soviet Union public health care system and have more freedom than in Europe and the US to choose and provide patients with unique treatment technology.

how probable do is the introduction of a reim-bursement system in two or three year’s time? The pharmaceutical market in Ukraine is a market in the tradi-tional sense of the word, but public health is a different issue. We have a large number of hospitals per capita, the average duration of stay is between seven and eight days, which is high in comparison to European countries, and we are in the top of the European rankings regarding the number of doctors per capita as well. But if we look at the quality of the medi-cal service offered, we are in the bottom of the ranking. That is a huge discrepancy. Another point is that the health care

expenditures from the state budget increase by ten to twenty percent annually. Nevertheless, the quality of the care has not changed in positive way.

On top of that much bigger resources are needed for public health. Obligatory medical insurance as it has been tested in a number of countries with well-functioning health care systems is unfortunately slow to be introduced in Ukraine due to po-litical reasons. We need resources to implement a reimburse-ment system or even a basic system that would cover vital ex-penses. Neighboring Moldova rapidly introduced obligatory public health insurance and reimbursement, and it was not more expensive than their previous public health expenditures. We need the political will in Ukraine, but unfortunately for sev-eral reasons, public health is not a priority. The pharmaceutical industry insisted that it should be a political priority and tried to forge political agreement between government and opposi-tion to stimulate public health reform, but unfortunately it did not help.

What is your vision for Orion in the future, say in the next 3 years? What would you like to achieve by then?We came to Ukraine when the future was totally unpredict-able, in 1993, and we stayed and witnessed all volatile eco-nomic and political developments the country has seen ever since. We became quite experienced in managing this.

We will continue to develop in those therapeutic areas in which we have a strong presence, and we will communicate even better with the market and with professional medical as-sociations. All in all, we will continue to work as a responsible producer of high-quality medicine.

We are happy that international associations and producers show an increased attention for Ukraine. There are true market opportunities here, while the number of acquisitions is very low at this point. Despite the unpredictability of the regula-tory and economic environment, the Ukrainian case deserves promotion, and the different actors involved in the pharma-ceutical industry need positive pressure and media attention. On top of that, it could help the authorities realize that they can do a better job. There should be a clear message on what is expected of Ukraine.

the Ukrainian case deserves promotion, and the different actors involved in the pharmaceutical industry need positive pressure and media attention



Ukraine Report

iNtErviEW With: Vladimir Sayenko - Managing Partner - Sayenko Kharenko

What were the market needs that led you to create Sayenko Kharenko in 2004?Before setting up an office in 2004 both other founding partners and I were active on the market for well over 10 years. At that time Ukrainian law firms concentrated on the tradi-tional practices, such as litigation and basic corporate work, while Western

law firms knew how to present their legal advice properly, but did not always understand local realities and legislative frame-work. When the demand was shifting towards sophisticated transactional spheres - such as capital markets, international finance, M&A, competition law, international trade, we found ourselves among the very few lawyers capable to handle com-plex cross-border work and could make good use of our com-petitive strengths: local expertise, diverse international edu-cation, experience in cross-border matters and western style approach to doing business. We serviced much of the invest-ment boom that started in 2005, and topped transactional leagues tables in Ukraine during the first year on the market.

how important is the pharmaceutical industry for Sayenko Kharenko?The pharmaceutical industry gradually became a special-focus sector for Sayenko Kharenko. Initially, we handled a number of M&As between the big players which had some implication for the local market and required merger clearance in Ukraine. This gave us a deep understanding of how the industry works and what the important issues are. We have now shifted from occasionally dealing with pharmaceutical sector in transaction-al matters to advising industry players on a regular basis on a broad range of legal issues.

For the lawyers in our trade practice, the situation is a lit-tle different. They became involved with the pharmaceutical

industry when first foreign companies tried to pioneer into the market through distribution contracts. For Ukraine, it was a new kind of legal relationship. Around 2004-2005, members of our team became the local experts for IDI (International Dis-tribution Institute) set by ICC Trade Committee. This institution provides a platform for debating many industry issues, includ-ing legal aspects of IP rights and registration. Unfortunately, infringements of IP rights were very common in Ukraine at that time, but foreign companies were still rushing to enter the market in order to benefit from the opportunities.

Would you say there is a trend for MNCs to move to an LLC structure rather than simply representative office? As the market develops and multinational companies expand their operations, they try to segregate risks arising from com-mercial operations by setting up subsidiary companies, primar-ily in the form of limited liability companies (LLCs). However, a representative office may be a more appropriate solution for minimal market presence limited to market research and other auxiliary functions.

we have seen the legal framework being gradually improved to attract foreign investors, yet the major country risks remain



Ukraine Report




Let’s talk about the competition issues and why they are important.Pharmaceutical industry and the principles of competition law and policy are very closely connected even, perhaps, more so than other industry sectors. This is illustrated by two significant realizations: (1) medical drugs are supposed to cure people, which is the principal reason why the Ukrainian government and, in particular, the Antimonopoly Committee of Ukraine (the “AMC”) subject pharmaceutical companies, especially foreign entities, to additional scrutiny and (2) any company, ever a very small one, can have a monopoly (dominant) posi-tion as markets run the risk of being very narrowly defined by the regulator.

The social importance of the pharmaceutical industry has motivated the AMC to conduct full-blown investigations on a regular basis. As a consequence, companies should be particu-larly vigilant when devising their marketing and pricing poli-cies. With respect to the former, special care needs to be taken to ensure that advertisements disseminated in the mass me-dia do not amount to false advertising - such as making false claims about a drug’s abilities. This is an area in which the AMC has recently been particularly aggressive, setting fines of more than EUR 100,000. Equally, the AMC investigates the industry to ensure that companies’ pricing policies are backed by strong objective and economic justifications.

Speaking about opportunities and being an M&A expert, how do you see the M&A climate?From an M&A perspective, the Ukrainian market may look quite attractive based on statistical growth figures, but eve-rybody has to realize why the estimated profits are so high: because the legal risks are also very high. Any due diligence re-view would reveal skeletons in the closet of the targets’ affairs. This is especially true of the privatized companies or companies that undergone numerous reorganizations which hardly ever go without violations. Finally, many deals might grind to a halt because of the apparent mismatch of the sellers and buyers’ expectations.

Do you feel that the national industry will eventually clean up so that M&A can become a possibility? Last year we have seen quite a few of the completed and struck deals, so some activity on the M&A market is already clearly visible. There is definitely a trend for the local industry to “clean up” in order to be more attractive. Moreover, we have seen the legal framework being gradually improved to attract foreign investors. Yet the major country risks remain the same: inconsistent application of the laws by various regu-

lators, corrupt judiciary and week enforcement. However, as I mentioned, these risks pay off with the much higher yields on investment than elsewhere in the developed economies. We have also seen the government making an effort to provide incentives for foreign companies to localize production.

What is your vision of the Ukrainian pharma-ceutical market in the upcoming 5 years? Ukraine is one of the biggest consumer markets in Europe and remains quite attractive for investments into the pharmaceuti-cal sector. Experts agree that the Ukrainian market will most probably remain a generics market for quite some time, thus investments into the development of local capacities for the production of essential generic drugs will probably be the mar-ket trend for the upcoming years.

We also have reasons to believe that industry players will be taking further steps to motivate consumer spending and consumption. In 2011 the consumer spending on medicines in Ukraine was estimated at USD 2.1 billion, which translates into USD 65 per capita and is almost twice as lower as, let’s say, in Russia. The market for innovative products will mostly be driven by strong import growth.

Overall the pharmaceutical market will grow more rapidly if the government manages to implement an effective health insurance system and remove burdensome and excessive regu-latory barriers. I feel that currently one of the problems facing the industry is insufficient communication with law makers and regulators. The maze of regulations applied to the procedure of the registration of generic products is an evident example.

overall, the pharmaceutical market will grow more rapidly if the government manages to implement an effective health insurance system and remove regulatory barriers



Ukraine Report

Exclusive interviewsMore interviews available on www.pharma.focusreports.net:

Timur Bondaryev Managing Partner, Arzinger

Lyudmyla Borisova General Manager, Sperco

Ala Ciobanu General Manager, Roche Ukraine

Cem Demirci General Director, Nobel Pharma Ukraine

Iryna Gorlova General Director, Support in Market Development (SMD)

Alexander Melnik General Manager, UCB Ukraine

Tatyana Pechaeva General Director, Lekhim

Anatoliy Reder General Director, Interchem

www.pharma.focusreports.net



Ukraine Report




Nataliya Sapozhnikova Head of Representatives, Mili Healthcare Ltd.

Yuriy Savko Executive Director, Association of Pharmaceutical Research and Development (APRaD)

Jean-Paul Scheuer General Manager, Sanofi Ukraine

Viktor Shafranskiy General Manager, IPSEN Ukraine

Krszysztov Siedlecki General Manager, Astellas Ukraine

Marina Simashova General Director, Unipharm, Inc. Ukraine

Alexandra Sologub General Manager, TEVA Ukraine

www.pharma.focusreports.net



Ukraine Report

Government institutionsState Agency for Investment and National Projects of Ukraine www.ukrproject.gov.ua [email protected] Tsytadelna Str. 7a, Kiev 01015 Tel: +38-044-254-40-15 Fax: +38-044-254-40-17

State Agency for Medicines www.diklz.gov.ua [email protected] Peremohy Avenue 120, Kiev 03115 Tel: +38-044-450-21-67

Ukraine’s Ministry of Health (MHU) www.moz.gov.ua [email protected] Hrushevskoho Str. 7, Kiev 01601 Tel: +38-044-253-61-94 Fax: +38-044-253-40-17

AssociationsAmerican Chamber of Commerce in Ukraine www.chamber.ua [email protected] Horizon Park Business Center Amosova Str. 12, Kiev 03680 Tel. +38-044-490-58-00 Fax +38-044-490-58-01

Association of Clinical Trials Organizations (ACTO) www.acto-russia.org/en [email protected] Malaya Dmitrovka Str. 4, Apt 5, Moscow 127006, Russia Tel: +74-095-956-13-87 Fax: +74-095-699-41-98”

Association of International Pharmaceutical Manufacturers (AIPM) www.aipm.org.ua/en [email protected]

Vector Business Center, Starokyivska Str. 10 G, Kiev 04116 Tel: +38-044-586-63-31 Fax: +38-044-586-63-32

Association of Pharmaceutical Manufacturers of Ukraine (AFVU) www.afvu.org.ua/ [email protected] [email protected] Bankova Str. 1/10, _ffice 4, Kiev 01024 Tel: +38-044-253-28-69

Assoication for Pharmaceutical Research and Development (APRaD) www.aprad.org.ua/en [email protected], [email protected] Verkhniy Val 4-B, office 219, Kiev 04071 Tel: +38-044-493-91-30

European Business Association (EBA) www.eba.com.ua [email protected] Andriyisky uzviz 1a, Kiev 04070 Tel: +38-044-496-06-01

Pharmaceutical companiesAbbott www.abbott.com [email protected] Zhylyanskaya Str. 110,Kiev 01032 Tel: +38-044-498-60-80

Actavis www.actavis.com.ua [email protected] Bul. Shevchenko 33, Section BS-3, Kiev 01032 Tel: +38-044-569-80-20 Fax: +38-044-569-80-18”

Alcon www.alcon.com Pymonenka Str. 13, bld 6A, Office #30, Kiev 04050

Tel: +38-044-494-25-53 Fax: +38-044-494-25-54”

Amway www.amway.ua [email protected] Bozhenko Str. 86, Kiev 03150 Tel +38-044-495-13-00 Fax +38-044-495-13-44”

Apteka95 www.apteka95.com.ua [email protected] Yurjevskaya Str. 17., Kharkov 61001, Ukraine Tel: +38-057-714-06-03

Arterium www.arterium.ua [email protected] Saksaganskogo Str. 139, Kiev 01032 Tel: +38-044-490-75-22 Fax: +38-044-490-75-17 “

Astellas Pimonenko Str. 13, bld. 5A, office 41, Kiev 04050 Tel / Fax: +38-044-490-68-26

AstraZeneca www.astrazeneca.ua V.Khvoyki Str. 15/15, Kiev 04080 Tel: 0 +38-044-391-52-82 Fax: +38-044-391-52-81

Bayer Schering www,bayer.ua Verhniy Shaft Str. 4-b, Kiev 04071 Tel:+38-044-220-33-00 Fax:+38-044-220-33-01

Bionorica www.bionorica.com.ua [email protected] Minina Str. 9, Kiev 02094 Tel. +38-044-296-22-03 Fax: +38-044-451-83-09”

Company directory



Ukraine Report




Boehringer Ingelheim www.boehringer-ingelheim.ua [email protected] Turgenevskaya Str. 26, Kiev 01054 Tel +38-044-494-12-75 Fax +38-044-494-12-71”

Borschagovsky Chemical and Pharmaceutical Plant www.bhfz.com.ua [email protected] Mira Str. 17, Kiev 03680 Tel/Fax: +38-044-497-21-48

Darnitsa Pharma www.darnitsa.ua [email protected] Borispilska Str. 13, Kiev 02093 Tel: 38-044-566-77-50 Fax:38-044-566-72-19”

Delta Medical www.deltamedical.com.ua [email protected] Chernovola Str., 43, Vishnevoe, Kiev 08132 Tel.: +38-044-593-33-55 Fax: +38-044-593-33-54”

Dr. Reddy’s www.drreddys.com [email protected] Bazhana av. 10a, Office 5a, Kiev 02140 tel: +38-044-207-51-97 mob: +38-050-411-98-65

Ecosorb www.ecosorb.com.ua Kotsyubinskogo Str. 8, Kiev 08130 Tel: +38-044-538-19-37

Eli Lilly www.lilly.com [email protected] V.Vasylkivska Str. 9/2, office 15, Kiev 01004 Tel: +38-044-490-25-85 FAX: +38-044-490-25-88”

Farmak www.farmak.ua [email protected] Frunze Str. 63, Kiev Tel: +38-044-496-89-63

FIC Medical (Recordati) [email protected] Proreznaya Str. 22, Office 3, Kiev 01034 Tel.: +38-044-238-63-06 Fax: +38-044-279-46-87

Fitofarm Artemov www.fitofarm.ua Sibirtseva Str. 2, Artemovsk, Donetsk region, Ukraine Tel: +38-06274-3-20-63

GE International www.gehealthcare.com Shovkovychna Str. 42-44, Kiev 01601 Tel +38-044-490-69-87 Fax +38-044-490-69-82”

Gedeon Richter www.richter.hu [email protected] Turgenyevskaya Str. 17/b, Kiev 01054 Tel: +38-044-482-09-56 Fax: +38-044-482-09-56 “

Genom Biotech India www.genomworld.com [email protected] Aerodromna Str. 12, Kiev 03151 Tel +38-044-246-26-27 Fax +38-044-246-26-26”

GlaxoSmithKline (GSK) www.gsk.com Linijna Str. 17, Kiev 03038 Tel: +38-044-585-51-85 Fax: +38-044-585-51-86”

Heel www.heel.com.ua [email protected] Vasilenko Str. 7, Kiev 03680 Tel: +38-044-451-92-71 Fax: +38-044-451-92-73”

Interchem www.interchem.com Konnaya Str. 11, Odessa 65080 Tel: +38-044-877-72-95

Ipsen www.ipsen.com Pushkinskaya Str. 36,

Kiev 01004 Tel: +38-044-502-65-29 Fax:+38-044-502-65-29

Janssen www.janssen-emea.com Tel: +38-044-490-64-64

Johnson & Johnson www.jnj.com

Kiev Vitamin Factory www.vitamin.com.ua [email protected] Kopylivska Str. 38, Kiev 04073 Tel: +38-044-468-11-96

Krasnaya Zvezda www.zvezda.kharkov.ua [email protected] Gordienkovskaya Str. 1, Kharkov 61010 Tel: +38-057-733-17-58

Kreoma Farm www.enterosgel.com.ua [email protected] Radischeva Str. 3, Kiev Tel: +38-044-497-95-45

KRKA www.krka.biz/en/krka [email protected] Staronavodnitskaya Str. 13, office 125, Kiev 01015 Tel: +38-044-569-28-38 Fax: +38-044-569-28-48”

Lekhim Group www.lekhim.ua [email protected] Shota Rustaveli Str. 23, Kiev 01033 Tel: +38-044-246-63-12 Fax +38-044-246-63-07

Lektravi Zhitomir www.liktravy.com.ua [email protected] Kievskoe shosse 21, Zhitomir 10001 Tel: +38-0412-42-79-32



Ukraine Report

Lubnifarm www.lf.com.ua [email protected] Petrovskogo Str. 16, Lubny 37500

Lundbeck www.lundbeck.com [email protected] Kreschatik Str. 19a, Kiev 01001 Tel: +38-044-490-29-10 Fax: +38-044-490-29-11”

Menarini/Berlin Chemie www.berlin-chemie.ua [email protected] Bereznyakivska Str. 29, Kiev 02098 Tel: +38-044-494-33-81 Fax: +38-044-494-33-89”

Merck-Serono www.merckserono.ru [email protected] Smolnaya Str. 24D, Moscow 125445, Russia Tel: +7-495-937-33-04

Mili Healthcare www.mili.ua [email protected] Bogomoletz Str. 5, office A, Kiev Tel / fax: +38-044-254-04-76

MSD www.merck.com Pushkynskaya Str. 31a, Kiev Tel: +38-044-393-74-80

Novartis www.novartis.com dmitriy,[email protected] Bereznyakivska Str. 29, Kiev 02098 Tel: +38-044-490-53-38 Fax: +38-044-490-53-39”

Novo Nordisk www.novonordisk.ua Sagaidachnogo Str. 29 / 1, Kiev 04070 Tel: +38-044-581-12-60 Fax: +38-044-581-12-68

Nycomed/Takeda www.nycomed.com Solomenskaya Str. 11, Kiev 03110 Tel: +38-044-390-09-09 Fax: +38-044-390-29-29

Octapharma G. Stalingrada Av. 59, Apt. 164, Kiev 04213 Tel: +38-050-333-00-16

Orion Pharma www.orion.fi [email protected] Cubic Business Center, Sholudenko Str. 3, office 309, Kiev 04116 Tel: +35-810-426-57-66

Otava Chemicals www.otavachemicals.com [email protected] [email protected] P.O 88 Kyiv 187, 03187 Tel/Fax: +38-044-522-24-58

Pfizer www.pfizer.com [email protected] Mykoly Amosova Str. 12, Kiev 03680 Tel: +38-044-291-60-50 Fax: +38-044-291-60-51”

Pharma Start www.phs.com.ua [email protected] Lepse Blvd. 8, Kiev 03124 Tel: +38-044-404-58-52 Fax: +38-044-497-78-13”

Pharmalife www.phlife.com.ua Apostol Str. 2D,Lviv 79040 Tel: +38-032-297-16-88 Fax: +38-032-297-16-29”

Polpharma Turgenivska Str. 15-B, Kiev 01054 Tel: +38-044-461-90-07 Fax: +38-044-461-93-87”

Procter & Gamble www.pg.com.ua [email protected] Naberezhno-Khreshchatytska Str. 5a/13, Kiev 04070 Tel: +38-044-490-09-00 Fax: +38-044-492-01-02

Pro-Pharma www.pro-pharma.com.ua Kazazkaya Str. 120/4, Bld _, Kiev 03680 Tel: +38-044-42-25-070

Rainbow Ltd www.rainbow.kiev.ua [email protected] Stroyindustriy Str. 5B, Kiev 01013 Tel : +38-044-502-50-95 Fax : +38-044-502-50-96

Ranbaxy www.ranbaxy.com.ua [email protected] Gryshka Str. 3a, Kiev 02140 Tel: +38-044-492-82-18 Fax: +38-044-492-82-19”

Ratiopharm (part of TEVA) www.ratiopharm.ua [email protected] Fizkultury Str. 30-B, Suite 604, Kiev 03680 Tel: +38-044-490-58-62 Fax: +38-044-594-70-81

Roche Business Center Leonardo, Bogdana Khmelnitskogo Str. 19-21, 10th floor, Kiev 01030 tel: +38-044-354-30-40;

Sandoz www.sandoz.com [email protected] Amosova Str. 12, Kiev 03680 tel: +38-044-495-28-66

Sanofi www.sanofi-aventis.com.ua Prime Business Center, Zhylyanska Str. 48-50A, Kiev 01033 Tel. +38-044-354-20-00 Fax: +38-044-354-01-20 “

Servier www.servier.ua [email protected] Renaissance Business Center, Vorovskogo Str. 24, Kiev 01601 Tel: +38-044-490-34-41 Fax: +38-044-490-34-40”



Ukraine Report




Solvay Schorsa Str. 31, Kiev 01133 Tel: +38-044-230-20-98

Sperco www.sperco.com.ua/en [email protected] 600-letiya Str. 25, Vinnitsa 21027 Tel: +38-043-252-30-49 Fax: +38-043-252-33-90”

SPRI Clinical Trials http://www.spriclinicaltrials.com/ Artema Str. 37-41, Kiev 04053 Tel:+38-044-492-80-55 Fax +38-044-492-80-54”

Stada/Nizhpharm www.stada.de [email protected] Most Vasylkivska Str. 9 / 2, office 52, Kiev 01004 Tel: +38-044-459-46-00

Stirol Corp (Stirolbiopharm) www.pharm.stirol.net [email protected] Gorlovka Division Str. 97, Gorlovka, Donetsk region, Ukraine Tel: +38-062-427-85-28 Fax: +38-062-427-87-52

Stoma www.stoma.kharkov.ua [email protected] Newton Str. 3, Kharkov 61105 Tel: +38-057-766-28-24

Ternopharm www.ternopharm.com.ua Fabrichnaya Str. 4, Ternopil 46010

TEVA www.teva.ua [email protected] Fizcultury Str. 30B, office 604, Kiev 03680 Tel: +38-044-594-70-80 Fax: +38-044-594-70-81

Torrent Pharmaceuticals www.torrentpharma.com [email protected] Saksaganskogo Str. 77, Kiev 01033 Tel: +38-044-507-06-46 Fax +38-044-507-06-47

UCB Pharma www.ucb.com [email protected] G. Skovorody Str. 19, Kiev 04070 Tel: +38-044-492-94-74 Fax: +38-044-492-94-75”

UCRAFARMA www.ucrafarma.com [email protected] Plaza de la Castellana, 159-1 B, Madrid, Spain +34 91 44 90 643

Unipharm www.unipharm.ua [email protected] Mechnikova Str. 3, Kiev 01601 Tel: +38-044-390-52-70

Unique Pharmaceutical Laboratories www.unikfarma.com.ua [email protected] Shevchenko Str. 19, Novograd-Volynskyy, Zhytomyrska Region, Ukraine Tel: +38-041-413-52-81 Fax: +38-041-413-52-82”

Viola www.viola.zp.ua [email protected] Skladskaya Str. 4, Zaporozhye Tel: +38-061-289-00-55

Yan Agrofirma [email protected] Chernomorskaya Str. 4, Kiev Tel: +38-044-239-19-15

Yuria Ukr www.uf.ua [email protected] Amosova Str. 10, Kiev 03680 Tel: +38-044-246-81-91

Zdorovje Group www.zt.com.ua [email protected] Shevchenko Str. 22, Kharkov 61013 Tel: +38-057-757-07-77 Fax: +38-057-714-96-20

DistributorsAlba Ukraine [email protected] Shevchenka Str. 100, Boryspil 08300 “ Tel: +38-044-490-32-71 Fax: +38-044-490-32-71”

Apopharm www.vvs-ltd.com.ua [email protected] Viscose Str. 17, Bldg 93-A, Kiev Tel: +38-044-207-01-93

Artur-K www.arturk.uaprom.net Chaika Str. 4, Kiev Tel: +38-044-391-50-90

BADM www.ooobadm.dp.ua [email protected] Panikakhi Str. 2, Dnepropetrovsk 49005 Tel : +38-056-747-01-10, “

FALBI www.falbi.ua [email protected] 20 Bilgorodska Str., Kiev 08141 Tel : +38-044-200-45-47

Optima Pharm www.optimapharm.ua [email protected] Boryspil’ska Str. 9, Kiev 02099 Tel: +38-044-490-53-10 Fax: +38-044-490-53-10”

Venta www.ventaltd.com.ua Krestyanskyi spusk 3, Dnepropetrovsk



Ukraine Report

VVS www.vvs-ltd.com.ua [email protected] Pomichlennaya Str. 3, Gotiv, Ukraine Tel: +38-044-406-05-50

service ProvidersAlivia Swiss Health Management www.alivia.com [email protected] 7, Balz Zimmermanstrasse, Balsberg, Zurich Tel: +41-43-813-33-11 Fax: +41-43-813-33-14”

American Medical Centers www.amcenters.com [email protected]

Berdychivska Str. 1, Kiev 04116 Tel: +38-044-490-76-00 Fax: +38-044-490-76-01”

Arzinger (Legal services) www.arzinger.ua [email protected] Eurasia Business Centre, Zhylyanska Str. 75, Kiev 01032 Tel: +38-044-390-55-33 Fax: +38-044-390-55-40”

Consumer Health Technologies www.consumerhealthtech.com [email protected] 6700 North Andrews Avenue, Suite 210, Fort Lauderdale, FL 33309, U.S. Tel: +1-954-315-0902

Kompetenz Team www.k-team.com.ua [email protected] Gusovskogo Str. 11/11, office 3, Kiev 01011 Tel: +38-044-569-15-62

Proxima Research www.proximaresearch.com [email protected] Bazhana Avenue 10A, Kiev 02140 Tel: +38-044-585-97-22

Sayenko Kharenko (Legal services) www.sk.ua [email protected] Muzeyny per. 10, Kiev 01001 Tel: +38-44-499-60-00



Ukraine Report




COMPANy iNDEx

AIPM .............................................................8

APRaD ........................................................10

Darnitsa .....................................................16

Eli Lilly ........................................................14

Farmak ....................................................8 14

IMS Health ...................................................9

Interchem ...................................................12

Janssen .................................................13, 14

Johnson&Johnson .....................................13

Lekhim .......................................................17

Lundbeck Ukraine .....................................17

Mili Healthcare ..........................................13

Nobel Ilac Ukraine .....................................15

Nobel Pharma ............................................15

Nycomed Ukraine ....................10, 11, 14, 18

Orion Pharma ..............................................9

PIC/S .......................................................9, 14

PWC ............................................................16

Roche Ukraine .....................................11, 13

Sanofi Ukraine ...........................................14

SAUMP ...................................................8, 14

Sayenko Kharenko ....................................14

Sopharma ..................................................18

Sperco ..................................................17, 18

Support in Market Development (SMD) 8, 9

Takeda ........................................................11

TEVA Ukraine .............................................10

Ukraine’s Ministry of Health ....................10

Unipharm ...................................................11

World Trade Organization ..........................7



Ukraine Report

PASt rEPOrtS

http://issuu.com/focusreports/docs/phex_brazil_2012

Link: http://issuu.com/focusreports/docs/hungary_pharm_2012

http://issuu.com/focusreports/docs/pe1211_country_uk_-_december_2011

http://issuu.com/focusreports/docs/phex_russia_2011

: http://issuu.com/focusreports/docs/phex_romania_2011

http://issuu.com/focusreports/docs/phex_india_2011

http://issuu.com/focusreports/docs/phex_serbia_2011

: http://issuu.com/focusreports/docs/phex_poland_2011

http://issuu.com/focusreports/docs/phex_malaysia_2011



Ukraine Report






Ukraine Report

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Pharmaceuticals Ukraine report 2012

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