Pharmaceutical Products Sales of ОТС medications increased by RUR 4,459.9 million (43.0%) from RUR 10,380.8 million in 2008 to RUR 14,840.7 million in 2009. This increase was largely due to our aggressive promotion strategy. The following drugs were the key contributors to the increase (92.4%): Arbidol®, Pentalgin®, Complivit®, and Afobazol®. Sales of Arbidol® grew by RUR 2,772.1 million (101.5%) in 2009 as compared to 2008, which was to a great extent related to A/H1N1 2009 flue pandemic. In 2009, certain pharmaceutical products showed a dramatic growth in sales: Pentalgin® (sales increased by RUR 517.8 million, i.e., 32.7% growth), Complivit® (sales increased by RUR 515.7 million, i.e., 76.6% growth) and Afobazol® (sales increased by RUR 313.5 million, i.e., 144.1% growth). Sales of Afobazol® started in August of 2008 when this trade mark was acquired. Total sales of this drug amounted to RUR 531.0 million in 2009 and it was rated among the OTC portfolio TOP-10. In August-December 2009 as compared with the same period in 2008, Afobazol® sales increased by RUR 98.8 million (45.4%) – from RUR 217.5 million to RUR 316.3 million, respectively. Sales of prescription drugs (Rx) grew by RUR 976.2 million (71.7%) from RUR 1,361.9 million in 2008 to RUR 2,338.1 million in 2009. The following drugs were the key contributors to the increase of sales of Rx drugs in 2009: Phosphogliv® – increase by RUR 171.5 million (40.4%); Combilipen® – increase by RUR 156.2 million (399.1%); Rastan® – increase by RUR 150.0 million (416.2%); Cocarboxylase hydrochloride – increase by RUR 70.4 million (182.3%); and Picamilon® – increase by RUR 67.6 million (110.8%), (before November 2009, the Company manufactured and sold the products branded by Picamilon® trademark under license agreement and in November 2009, this trademark was acquired by the Company). The management believes the structure of pharmaceutical consumption in Russia has shifted to bulk products (traditional non-branded products). In the reporting period Pharmstandard’s sales were growing not only due to the Company’s leading brands, but also because of increasing sales of cheaper bulk products due to re-direction of customer demand because of the crisis.
Medical Equipment and Disposables Sales of medical equipment and disposables declined in 2009 by RUR 386.9 million (36%) to RUR 688.7 million from RUR 1,075.7 million in 2008. Such decline in sales was caused by cuts in budget financing of state medical institutions that are primary consumers of products manufactured by Tyumen Medical Equipment and Instruments Plant (TMEIP). Another cause of the decline is the reduced amounts of state tenders in the hospital industry as a whole resulting from the global financial crisis that started late 2008.
Management’s Discussion and Analysis of Financial Condition and Results оf Operations development
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