25 August 2014

Manufacturers are betting on generics

The brilliance and poverty of the Russian pharmaceutical market

Dmitry Karasev, "Epigraph"

According to official data, the Russian market of medicines is growing at a rate of 8-10% per year. Such impressive growth rates are not yet able to offset the low consumption of medicines by ordinary consumers – compared to developed countries, Russians spend many times less money on the purchase of medicines.

A three-year study by the Federal Antimonopoly Service showed that Russia has some of the highest prices for medicines in the world. According to the head of the department Igor Artemyev, this was the result of gross mistakes in the regulation of the pharmaceutical market. Thus, Western companies owning patents greatly inflated prices, as a result of which the cost of similar drugs in the country could vary by 12 times!

What do we produce?The lion's share of products produced by Russian pharmaceutical companies are generics.

According to Wikipedia definition, generic is "a medicinal product with proven pharmaceutical, biological and therapeutic equivalence to the original" (a drug with the same composition of active ingredients, the same dosage form and with the same efficacy as the original).

What is the reason for the widespread specialization in generics? Firstly, pharmaceutical companies that have remained in Russia since Soviet times initially specialized in the production of auxiliary components and intermediate substances. As a result, their equipment with modern equipment was, to put it mildly, small.

Secondly, the birth of a new drug requires the investment of a lot of time and money – at least 10-15 years, while not all new drugs are effective. Often unfair and well-paid competition from international pharmaceutical concerns leaves no chance for domestic firms to succeed.

In addition, production aimed at developing original medicines must comply with international standards, have modern equipment, qualified specialists, etc., which means additional costs.

Since the beginning of 2013, the share of domestic generics in the Russian market has increased by 23% to 70%. On average, 25 such medicines are registered quarterly, and, as the head of the Ministry of Health of the Russian Federation Veronika Skvortsova assured, their initial price is 40-50% lower than analogues of foreign production. If we compare Skvortsova's opinion with the FAS data, we can conclude that the pharmaceutical market intermediaries and trading companies receive the lion's share of profits.

Pros or cons?The effectiveness of the generic cannot be compared with the effectiveness of the original drug.

For example, Voltaren (an anti-inflammatory agent) has about 120 copies on the Russian market. Normally, there should be no more than 3-5 generics of one drug, and all of them are carefully tested. However, research takes a lot of time and money. Therefore, some manufacturers are in a hurry to launch the release of generics literally immediately after the expiration of the patent. So, as soon as the patent for the antibiotic azithromycin (sumamed) expired, a dozen of its generics appeared in pharmacies. And "under-researched" generics are not always happy with the results.

According to the associate Professor of the Department of Internal Diseases of the Medical Faculty of Novosibirsk State Medical University (NSMU) Vyacheslav Mitrokhin, "the doctor prescribes the drug according to the international nonproprietary name (INN). The pharmacy can offer different drugs with the same INN. The original drug and generics may have different prices, but until proven otherwise, all drugs with one INN are considered equivalent. A few studies conducted in Russia have shown that generics may differ from the original drug in effectiveness, although the differences are often small. The choice of the drug by trade name is up to the patient and the pharmacist."

The main thing is the effect?You can say: "Why investigate something that is a copy of the original?" But not everything is so simple.

After all, generics are produced on different equipment and using a different technology. Ingredients are bought from other manufacturers and may be of the "wrong" quality. Especially if they are purchased from India, China or Vietnam out of savings…

The generic market competes fiercely with proprietary products. Vivid examples of original medicines and their copies are "No-shpa" and "Drotaverine", "Mezim" and "Pancreatin", "Nurofen" and "Ibrupofen", "Panadol" and "Paracetamol". At the same time, the difference in cost can be from 3 to 10 times.

According to market research, the Russian market of finished medicines (GLS) has not grown up to Western standards (see the table below). Russians do not leave as much money in pharmacies as their "advanced" Western "colleagues."

Portal "Eternal youth" http://vechnayamolodost.ru25.08.2014

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