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Upharmacia U krainian P harmaceutical M arket M onthly

Macroeconomic Environment | Market & Companies News | Regulatory Updates | Healthcare News

Issue: 01 2016 UPharma Consulting is a consulting company, operating in the healthcare and pharma sectors. Our clients - pharmaceutical companies, pharmacy chains, distributors, investment funds, banks, and other stakeholders in the healthcare sector.

UPharma Consulting, Kiev

www.upharma-c.com / mailbox@upharma-c.com


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MACROECONOMIC ENVIRONMENT Table: Key macroeconomic indicators in Ukraine (Jan-Dec 2015)

Jan

Feb

Mar

Apr

May

2015 Jun Jul

Aug

Sep

Oct

Nov

Dec

MACROECONOMIC INDICATORS GDP (bn USD) GDP growth, % y-o-y

Export of goods (bn USD) Export growth, % y-o-y

Import of goods (bn USD) Import growth, % y-o-y

Industrial production sales (bn USD) Industrial production growth, % y-o-y

Retail turnover of enterprises (bn USD) Retail turnover growth, % y-o-y

Unemployment rate Average salary (USD)

Q1

Q2

Q3

17.353

20.795

25.552

-51%

2.98

3.45

-37%

-32%

-32%

3.01

2.86

-34%

6.01

-41%

4.56

-41%

1.97

-35%

2.99

-54%

1.44

-50%

-61%

3.17 -35%

5.51 -45%

1.61

3.07

-26%

2.94

3.09

-39%

-41%

-30%

2.86

2.63

-38%

5.91 -33%

1.66

-46%

5.65 -38%

1.94

Q4

2.76 -37%

5.79 -35%

1.83

3.15

3.09

3.35

-34%

-22%

-22%

2.98

3.88

-34%

5.71 -33%

1.94

-2%

5.42 -23%

1.88

3.24 -30%

5.72 -20%

1.86

3.23 -23%

3.22 -27%

6.29 -21%

2.04 -31%

3.13 -21%

3.07

3.36 -11%

3.12

-27%

-32%

5.92

6.37

-19%

1.80 -33%

-17%

2.01

-56%

-40%

-35%

-38%

-41%

-32%

-38%

2.0

2.0

1.9

1.8

1.8

1.7

1.6

1.6

1.5

1.5

1.6

-29%

1.9

218

148

166

176

193

202

202

194

199

207

193

223

24.5 27.8

23.3 25.3

22.7 24.5

20.9 23.3

21.2 23.8

21.8 23.9

21.6 24.0

21.8 24.5

21.8 24.6

23.3 25.1

23.4 25.4

12.05

13.37

13.46

13.00

15.36

13.85

9.01

13.79

12.2

11.7

15.77

-42%

-50%

-44%

-39%

-39%

-6%

-54%

114.5

103.3

103.7

84.2

115.0

106.5

93.3

OFFICIAL CURRENCY EXCHANGE RATE UAH/USD UAH/EUR

15.8 18.5

PHARMACEUTI CAL INDUSTRY INDICATORS Export of pharma products (mio USD) Pharma Export growth, % y-o-y

Import of pharma products (mio USD)

11.79 -1%

90.2

Pharma Import growth, % y-o-y

-49%

-47%

-67%

-36%

-60%

-44%

-47%

Pharma retail sales, values (mio USD)

239.8

177.0

197.6

180.0

193.0

177.7

172.6

-47%

177.1

-47%

121.1

-37%

147.1

-52%

-28%

141.3

142.1

-31%

-28%

-24%

-42%

193.2

206.3

196.6

212.3

Retail sales in values growth, % y-o-y

-41%

-54%

-47%

-40%

-28%

-29%

-32%

-24%

-28%

-26%

-20%

-18%

Pharma retail trade, volumes (mio units)

132.4

143.9

141.5

122.6

124.5

118.4

119.5

122.5

126.7

130.2

129.0

136.4

Retail sales in volumes growth, % y-o-y

WACP, USD

-21%

1.95

-15%

1.81

-21%

1.24

-20%

1.41

-11%

1.47

-9%

1.52

-10%

1.48

-8%

1.45

-11%

1.52

-5%

1.58

-4%

1.52

-5%

1.56

WACP growth, % y-o-y

-21%

-22%

-40%

-27%

-23%

-21%

-23%

-18%

-19%

-22%

-18%

-14%

CPI of Ukraine Pharma products CPI Local companies share, values, % Local companies share, volumes, %

128.5 149.2 38.7 74.9

134.5 155.5 38.5 75.2

145.8 170.3 39.6 77.1

160.9 164.7 40.7 77.6

158.4 159.5 41.5 77.6

157.5 153.5 41.7 77.9

155.3 151.8 41.8 78.4

152.8 149.4 41.4 78.2

151.9 145.8 41.4 76.5

146.4 142.1 41.4 75.7

138.1 146.6 41.7 75.8

134.6 143.3 40.9 76.7

Description of the indicators:

Pharmaceutical Industry Indicators

Macroeconomic Indicators

Export of pharma products is an export of goods related to the group “Pharmaceutical products” under the Ukrainian Classification of Goods for Foreign Economic Activities. Initially calculated in USD. Source: State Statistics Service of Ukraine.

GDP (Gross Domestic Product) is an aggregate measure of production equal to the sum of the gross values added of all resident, institutional units engaged in production (plus any taxes, and minus any subsidies, on products not included in the value of their outputs) calculated in current prices. Converted from UAH to USD in accordance with an average official NBU exchange rate in the corresponding period. Hereinafter: excluding the temporarily occupied territory of the Autonomous Republic of Crimea and City of Sevastopol, as well as the part of zone of the antiterrorist operation. Source: State Statistics Service of Ukraine. Export of goods is a sale of goods by Ukrainian subjects of foreign economic activities to foreign subjects of foreign economic activities (including non-cash payment) with or without exportation of these goods through the customs border of Ukraine, including the re-export of goods. Initially calculated in USD. Source: State Statistics Service of Ukraine. Import of goods is a purchase (including non-cash payment) of goods by Ukrainian subjects of foreign economic activities in foreign subjects of economic activities with or without the importation of these goods into the territory of Ukraine, including the purchase of goods for domestic consumption by establishments and organizations of Ukraine located abroad. Initially calculated in USD. Source: State Statistics Service of Ukraine. Industrial production sales is the value of industrial goods, which are actually shipped in the period, as indicated in documents decorated as the basis for calculating with the buyer (customer), regardless of income payments for them. Converted from UAH to USD in accordance with an average official NBU exchange rate in the corresponding period. Source: State Statistics Service of Ukraine.

Import of pharma products is an import of goods related to the group “Pharmaceutical products” under the Ukrainian Classification of Goods for Foreign Economic Activities. Initially calculated in USD. Source: State Statistics Service of Ukraine. Pharma retail sales are retail sales of different product categories of “pharmacy basket” (drugs, medical devices, cosmetics and food supplements) in values and volumes. Converted from UAH to USD in accordance with an average official NBU exchange rate in the corresponding period. Source: Morion. WACP (Weighted average cost of a pack) is a ratio of pharma retail sales in values to pharma retail sales in volumes. CPI (Consumer price index) is an indicator of changes at the time of prices and tariffs for commodities and services being purchased by the population for unproductive consumption calculated to corresponding month of previous year. Source: State Statistics Service of Ukraine. Pharma products CPI is a Consumer price index of “Pharmaceutical products, medical products, appliances and equipment” group calculated to corresponding month of previous year. Source: State Statistics Service of Ukraine. Local companies share is the share (percent) of sales related to Ukrainian companies in overall pharma retail sales in values and volumes. Source: Morion

Retail turnover of enterprises is the value of consumer goods sold via retail trade and restaurants to the population by all operating enterprises. It also includes direct retail sales by industrial, transport and other non-trade enterprises. In addition, retail turnover includes retail sales of food products to departments, organizations and enterprises to provide meals to the people they serve (at sanatoria, children’s care institutions, hospitals, etc.). Reflected in current prices. Converted from UAH to USD in accordance with an average official NBU exchange rate in the corresponding period. Source: State Statistics Service of Ukraine. Unemployment rate is a ratio (percent) of the unemployed registered at the State Employment Service to the average annual population of working age. Source: State Statistics Service of Ukraine. Average salary is an average value of remuneration in cash and in kind paid to employees for time worked or work done. Converted from UAH to USD in accordance with an average official NBU exchange rate in the corresponding period. Source: State Statistics Service of Ukraine. Official currency exchange rate is the rate established by the National Bank of Ukraine under which Ukrainian national currency – UAH (Ukrainian hryvnia) will be exchanged for foreign currency (USD or EUR). Calculated as average value in the corresponding period. Source: National Bank of Ukraine.

Ukrainian Pharmaceutical Market Monthly: January 2016


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260

160

mio USD

239.8

240

143.9

220 200

132.4

180

141.5

197.6 180.0

177.0

160

193.2

193.0 177.7 124.5 118.4

172.6 119.5

177.1 122.5

126.7

212.3 196.6

136.4

130.2 129.0

Jan

Feb

Mar

Apr

May

Jun

120

110

Industrial production sales

7

6.01

5.91

5.51

6

5.65

5.80

100

Aug

Sep

Oct

Nov

1.94 1.61

1.44

2

Retail turnover of enterprises 6.29 5.92 5.72 5.71 5.43

6.37

1.66

1.83

1.94

1.88

Feb

4

0

3.0

1.86

1.80

2.01 1.5

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

1.0

20 15 10 5

0.0

0

9.01 106.6

84.3

122.2 12.20

Export & Import, mio USD

19.26

Mar

28.95

29.52

24.48

145.8

23.26

100 80

Export

60 40

Import

Apr

160.9

26.92

22.71

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

180 158.4

157.5

25.48

24.91

26.09 25.91

26.14

20.92

21.23

21.76

21.78

155.3

152.8

21.63

151.9

146.4

24.6 21.8

146.6

143.3

25.1

25.4

23.3

23.4

160 140 120 100 80

15.81

UAH/USD

UAH/EUR

CPI of Ukraine

60

OFFICIAL CURRENCY EXCHANGE RATE

40

+Consumer Price Index

20

Jan-Dec 2015 Jan

140

20

Feb

134.5

160

120

11.70

93.3

Jan-Dec 2015

35

0.5

Dec

115.0

Ukrainian Internation trade in pharma production

128.5

15.77 141.3 142.1

103.4 103.7

90.2

147.1 13.75

13.85

13.37 13.46 13.00

114.5

Jan

2.0

2.04

11.79 12.05

30

Jan-Dec 2015, bn USD

0

Jan

6

2.5

Industrial production sales & Retail turnover of enterprises surplus

1

8

25

1.97

3

12

Dec

4.56

5

14

2

Jul

15.36

10

Values (mio USD) & Volumes (mio units) Jan-Dec 2015

100

140

130

Pharma retail sales

120

4

206.3

18 16

150

122.6

140

mio units

Feb

0

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

KEY ECONOMIC EVENTS »» »» »» »» »» »» »» »»

Ukrainian consumer prices index has averaged 43.3% in 2015, the State Statistic Service of Ukraine reported. The devaluation of national currency at the beginning of the year, as well as other unfavorable factors had caused to growth of prices on food (41.5%), clothing and footwear (35%), healthcare (29.1%, (incl. 51% on pharmaceuticals)), as well as doubling utility rates. In 2015, general budget deficit of Ukraine amounted to UAH 30.9 bn or 1.6% of GDP, while in 2014, the deficit was UAH 72.0 bn (4.6% of GDP). The IMF has accepted Ukrainian 2016 state budget, the Minister of Finance of Ukraine Natalia Jaresko stated on Jan 11. However, more structural reforms are expected for the IMF to approve the next tranche, she said. The decision on the third $1.65 bn tranche under $17.5 bn program is likely to be revised on early Feb. Gross reserves of Ukraine increased by 77% in 2015, up to USD 13.3 bn. The main sources of income were the IMF’s financial support and related official financing. Additionally, to replenish the reserves, the National Bank of Ukraine have been buying foreign currency directly on the interbank currency market and at the currency auctions, introduced in Sept 2015. In 2015, the EBRD financially supported 30 projects in Ukraine for about EUR 1 bn. Financial sector received EUR 387 mio, while EUR 283 mio were directed into energy development. In 2015, Ukrainian trade balan e of goods increased by 8.3% and reached USD 1.64 bn. According to the State Fiscal Service, Ukrainian goods export reduced by 29% y-o-y, while the import fell down by 30% y-o-y. Ferrous metals remained to be the main exporting good of Ukraine (21.2% share), while the main share of import was held by mineral fuel and oil (27.5%). The European Commission will propose to the EU Council to introduce a short-term, visa-free regime for Ukraine in 1Q2016, the European enlargement commissioner Johannes Hahn said on Jan 18. The EU still expects certain requirements to be met by Ukrainian officials. In 2015, Ukrainian industry declined by 13.4% y-o-y. However, last months of the year have shown a gradual recovery, in Dec the decline was 2.1% y-o-y, while in Nov it amounted 4.9% y-o-y. Donetsk and Lugansk regions has recovered by 34.7% and 66.0% y-o-y, respectively.

Ukrainian Pharmaceutical Market Monthly: January 2016


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MARKET & COMPANIES NEWS Antimonopoly committee of Ukraine endorsed the acquisition of “BCPP” On Jan 26, the Antimonopoly committee of Ukraine allowed “Darnitsa” to acquire more than 50% of shares of “BCPP” (“Borshchahivskiy chemicalpharmaceutical plant”). In Mar 2015, Financial Company “Kub”, representing “Darnitsa’s” interests, acquired 29.95% of shares of “BCPP”, belonging to Kyiv City Council, on the auction for UAH 171.8 mio. “We have not entered into negotiations with majority shareholders of “BCPP” yet,” the owner of “Darnitsa” Gleb Zagoriy said. “But we expect to close the deal during 2016.” As the results of 2015, “Darnitsa” retained third position on the Ukrainian pharmaceutical market by sales, while “BCPP” upped from 20th position to 16th position. The companies have a lot of overlapping and complementary assortment positions, as about 50% of “BCPP” sales are related to cardio-drugs, which is strategically important for “Darnitsa”. The companies also have similar manufacturing culture and debt-free policy. “Darnitsa” is working on strengthening of positions in its core segments: production of cardiovascular and neurotropic drugs of low and medium cost,” Mr. Zagoriy noted. “The emphasis is made due to the overall situation on the market, as the purchasing power fell down.” “Farmak” established substance manufacturing in Shostka

Ukrainian pharmaceutical market leader “Farmak” has created a separate GMP-complying manufacturing of substances in Shostka (Sumy Region). The manufacturing was established as part of expansion of production of finished drugs and active pharmaceutical ingredients. The complex includes manufacturing sites, quality control laboratories and logistic center. In Dec 2015, the State Administration of Ukraine on medical products had held a certification of quality control laboratory, as well as licensing conditions compliance verification and granted a permission to carry out activities for the production of APIs at the new facilities. Ukraine has drastically reduced its pharma trade in 2015 In 2015, Ukrainian export of pharmaceutical production reduced by 39% to USD 155 mio, while the pharmaceutical import cut down by 45% to USD 1.36 bn. The share in overall export and import in 2015 was 0.41% and 3.75%, respectively, while in 2014, the indicators were 0.47% and 4.71%. The overall international trade has fallen down by almost 30% in export and import. GSK in Ukraine approved the rules of engagement with pharmacy chains in marketing sphere The Representative of the British pharmaceutical company GlaxoSmithKline in Ukraine has approved the Rules of engagement with pharmacy establishments (pharmacies, pharmacy units) and pharmacy chains in marketing sphere and

developed the corresponding standard contract. “Cooperating with contractors in the sphere of marketing services ordering LLC “GlaxoSmithKline Pharmaceuticals Ukraine”, provides high ethical standards and principles of work complying the requirements in the field of preventing and combating corruption, economic competition protection, advertising, consumer protection, personal data protection, information and human rights protection”, GSK press service reported. GSK officials also indicated that the company uses uniform nondiscriminatory conditions for cooperation with each individual institution or pharmacy chain, which are willing and able to provide marketing services. Antimonopoly committee of Ukraine permitted “Farmak” to acquire Polish company On Jan 25, the Antimonopoly Committee of Ukraine has authorized “Farmak” to acquire Polish trade company KWW Kotkowski Wierzbicki Wegrzyn sp.j. The deal will provide “Farmak” an exceeding of 50% of the votes in the supreme governing body of the company. The Polish company was established in Sep 2015 to conduct trade activity with the focus on pharmaceutical preparations and child nutrition. In 2015, “Farmak” remained to be #1 company on the Ukrainian pharmaceutical market by sales. By 2020, the company plans to reach sales of over USD 1 bn, mainly, by enlarging its presence on the external markets of the Eastern Europe and the CIS.

Ukrainian Pharmaceutical Market Monthly: January 2016


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“Galychpharm” is to commit a private placement of shares The shareholders of PJSC “Galychpharm” (a part of “Arterium” corp.) will consider a private placement of shares at extraordinary meeting on Feb 23, 2016. The meeting also plans to approve the list of other investors, among which the placement of shares is provided and determine the authorized body of the company, which deals with the private placement of shares. The shareholders are also to consider the issue of the authorized capital increase through a private placement of additional shares through additional contributions. Moreover, the shareholders intend to approve a number of contracts of interest-free loan, as well as annexes to them on agreement amendments.

PJSC “Galychpharm” and PJSC “Kievmedpreparat” are included into “Arterium” Pharmaceutical Corporation, the main owner of which is “Finances and Credit” Financial Group, which were declared insolvent on Sep 17, 2015. In 2015, pharmaceutical market of Ukraine reduced by 33.5% y-o-y in values According to Morion, in 2015, Ukrainian pharmaceutical market reduced by 33.5% y-o-y in values (USD 2.324 bn), while in volumes it dropped by 12.3% y-o-y (1.547 bn units). Depreciation of the national currency in 1H2016 has affected prices in pharmacies. The average price of one unit of “pharmacy basket” increased by 41.1% y-o-y. However, since Jul retail prices stabilization have being observed, as in Dec 2015 retail prices

growth index amounted 21.2% y-o-y. Foreign companies has reduced its share in sales by 5% y-o-y in values (to 23.3%) and by 4% y-o-y in volumes (to 59.1%). TOP-4 companies on the market (“Farmak”, “Berlin-Chemie”, “Darnitsa” and “Arterium”) did not change their positions compared to 2014, while “Zdorovye Group” climbed from 8th position to 5th. In general, domestic companies rose in the rating, while foreign companies descended down. Actovegin and No-Spa remained to be the bestselling drugs in 2015, while Sodium chloride climbed to 3rd position (from 7th) and Nurofen to the 4th (from 10th). Rx drugs showed higher sales dynamics compared to OTC.

REGULATORY UPDATES On Jan 5, 2016, the Resolution of the Cabinet of Ministers of Ukraine #1153 “On Approval of the Procedure for import, supply and targeted use of drugs and medical devices, which are exempted form value added tax” dated Dec 2, 2015 was promulgated on the government website. Under the Procedure enterprises, institutions and organizations, which plan the import, no later than within ten working days before the date of importation, submit to the MOH an application for issuing certificates confirming the import of drugs, health care products to the customs territory of Ukraine in accordance with the agreements in paper and

electronic forms; duly certified copy of the foreign trade agreement, according to which such importation is planned; letter of commitment on the import of such drugs, medical devices solely for their delivery to the customs territory of Ukraine within the agreement; certified copies of quality certificates (certificates of analysis, protocols of analysis, etc.) issued by the manufacturer for a series of drugs offered for import. In its turn, the MOH within five working days of receipt of the documents, provides the importer a certificate confirming the import of drugs, healthcare products to the customs territory of Ukraine in accordance with the

agreements or sends a reasoned refusal in writing. -The Resolution of the Cabinet of Ministers of Ukraine #1176 “On Approval of the list of products, export and import of which is subject to licensing and quotas in 2016” dated Dec 30, 2015 has entered into force. The Resolution includes the list of products, which could contain ozone-depleting substances. The list includes:

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Ukrainian Pharmaceutical Market Monthly: January 2016

Medicines (drugs) (except for products included in headings 3002, 3005 or 3006) consisting of mixed or unmixed products for therapeutic or prophylactic use in dosed form (including medicinal products


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in the form of transdermal system) or put up ones for retail trade. cosmetics or make-up and skin care means, except for drugs, including sunscreen or suntan preparations; tools for manicure and pedicure; hair care tools; tools for oral or teeth hygiene, including powder and paste for dental prostheses; threads used to clean gaps between the teeth (dental floss), packed for retail sale and others.

The permission for export or import of products containing ozone-depleting substances is provided by Ministry of Ecology and Natural Resources of Ukraine according to the procedure established by the body. In the case of absence of ozonedepleting substances in goods, the customs clearance is carried without a license. -On Jan 12, 2016, the Resolution of the Cabinet of Ministers of Ukraine #1134 dated Dec 9, 2015, has entered into force. The Resolution #1134 has amended the Resolution #995 “On measures to stabilize prices on drugs and medical devises” dated Oct 17, 2008, and the Resolution #333 “Some issues of state regulation of prices of drugs and medical devices” dated Mar 25, 2008. According to the amendments, “The National List of drugs and medical devices” was renamed into “The National List of essential drugs”. Moreover, the Resolution obliges the MOH to approve within the month:

»» »» »»

The Provision on the National List of essential drugs; The Provision on the expert committee of the selection and use of essential drugs; The Provision on the selection of drugs for inclusion into the National List of essential drugs.

The main goal of the amendments is to develop the National List

of drugs to be conformed the recommendations of the WHO. -On Jan 12, 2016, the Draft Order of the MOH “On Amendments to the Order of the MOH of Ukraine #360 dated Jul 19, 2005” was published for public discussion. The Draft Order proposes healthcare institutions to note a trade name of a drug in prescription if a drug does not have an INN, refers to drugs of biological origin or to biosimilars and is sold on favorable terms or free. The Draft Order is expected to simplify a document management for pharmacies during the implementation of insulin reimbursement mechanism, as on Ukrainian market there is a variety of drugs of biological origin, like hormones, blood coagulation factors, monoclonal antibodies, enzymes, drugs from cells and tissues containing proteins, as well as drugs of genetic engineering technologies (incl. insulins). Therefore, if prescription contains an INN, a choice between several insulin drugs is taken by a pharmacist, who, apparently, is not familiar with individual medical needs of a patient. -On Jan 11, 2016, the new edition of the Draft Law of Ukraine “On Drugs” was promulgated and send to the Head of parliament Committee of Public Health. The Draft Law was developed on the base of two previous Drafts #2162 dated Feb 17, 2015, and #2162-1 dated Mar 2, 2015, as well as the Draft Law “On Drugs” #2446 dated May 5, 2008, which was revised in 2010. The Draft Law changes the conceptual apparatus, by supplementing the term of “active pharmaceutical ingredient” and changing the term of “drug’s safety”. At the same time, the following terms were excluded: “biological drugs”, “bioequivalent drugs”, “vaccines”,

“drugs manufacturer”, “drugs manufacturing”, “generic drugs”, etc. The Draft Law also contains a new chapter V. “Medical use and responsible self-medication”, which specifies that prescriptions should be carried out according to medical and technological documentation. The Draft Law also does not contain provisions on drugs advertising. The results of clinical and pre-clinical trials should be accompanied by expert reports made by independent experts, possessing a required professional qualification, confirmed by the addition of their professional biographies. The Draft Law foresees the “registration under the obligation” type of registration, which is used, if an applicant can prove that he has no possibilities to provide complete data on the efficacy and safety of a drug under the normal conditions of use for objective reasons, and refers to one of the following arguments:

»» »»

indications in which drug is used, are extremely rare, so the applicant cannot obtain enough data in clinical trials; on the basis of the existing scientific evidence complete information cannot be provided or collection of such information would be contrary to generally accepted principles of medical ethics.

In the registration under obligation, a drug is registered for a term allowing to implement following obligations:

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Ukrainian Pharmaceutical Market Monthly: January 2016

applicant must finalize a certain research program in a term established by the MOH of Ukraine. The results of a program would a base for the benefit/risk re-evaluation; a drug, applied for registration, could be sold by prescription only, and in some cases used only under strict medical supervision (in case of radiopharmaceuticals);


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short summary of a drug should pay a physician’s attention on the fact that the existing characteristics of the drug is somewhat insufficient.

During the execution of such obligations, an applicant has to report the side effects of the drug. The Draft Law also provides three levels of accreditation of pharmacies depending on the level of provision of

pharmaceutical services. Herewith, the level of accreditation should be indicated on a pharmacy’s signboard. -On Jan 28, the Public Health Committee of the Ukrainian Parliament has recommended to support in the first reading the Draft Law #3246 “On the prohibition of drugs advertising” dated Oct 7, 2015. The Draft Law

is aiming to prevent the cases of self-healing. The Draft Law prohibits an advertising of drugs except of medical equipment, methods of prevention, diagnosis, treatment and rehabilitation, which are permitted by a specially authorized central executive body in healthcare sphere.

HEALTHCARE NEWS The MOH will delegate all public procurements to international organizations in 2016 Under the government Decree signed by PM of Ukraine, the MOH will execute all public procurements of drugs and medical devises through specialized international organizations. “It will allow to decrease corruption risks in tender procedures, implement the procurement process in time, and most importantly, provide the population with necessary and high-quality medicines and vaccines”, the MOH press service stressed. In 2015, the MOH had already transferred drugs procurement for UAH 2.2 bn to international organizations, such as the UN (UNICEF), the UNDR and Crown Agents. Ukraine is experiencing an acute shortage of test kits for the diagnosis of infectious diseases Ukrainian Center for disease control and monitoring, as well as virology laboratories in the region are in dire need in the reagents and test kits against

influenza, diphtheria, tetanus, intestinal infections and other infectious diseases, the Director of the Center Lubov Nekrasova said. Shortage of reagents in Ukraine had arisen because of the termination of deliveries of Russian test kits, while the European preparations are not able to replace Russian counterparts due to the high costs. According to Ms. Nekrasova, nowadays, Ukrainian government does not conduct a centralized procurement of test kits and reagents, while each department, agency and local governments buy drugs on their own. She also admitted that Ukraine has everything needed to provide its laboratories with domestic production, but to develop the immuno-biological industry the country needs investors. The President of Ukraine said Healthcare reform is crucial for 2016 “In the first half of 2016, we will have a difficult discussion regarding the Healthcare reform. However, it cannot be delayed and I will not allow to do that,” President Petro Poroshenko

said. “We have to change this sphere drastically. Reformation of healthcare system is the change of the relationships between patient and doctor. This is a crucially new system of health insurance, envisaging the protection of the people with low income.” US capital company “Into-Sana” acquired “Medisvit” On Jan 13, the owner of a private clinic “Into-Sana” (Odessa) American investment fund “Siguler Guff&Company” has finished the acquisition of “Medisvit” company. “Medisvit” owns two medical centers in Kyiv; its private income in 2014 amounted USD 3.14 mio. In 2016, “Into-Sana” plans to open the third medical center in Kyiv and the sixth one in Odessa, the operational director of the company Dmitriy Lufer said. The conditions are favorable, as there is a sable rise of private medicine in Ukraine by 10-20% annually, he added. Kyiv Municipal Administration asked pharmacy chains to “freeze” prices on drugs against influenza and respiratory infections

Ukrainian Pharmaceutical Market Monthly: January 2016


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On Jan 15, Kyiv Mayor prohibited municipal pharmacy chain “Pharmacia” to increase prices on drugs for the treatment and prevention of influenza and acute respiratory viral infections for the period of seasonal morbidity rise in the city. Kyiv authorities have also asked the private pharmacy chains to do not increase prices during the growth in the incidence of the deceases. Experts formed the Advisory Council on pharmaceutical activities On Jan 15, the founding meeting of the Advisory Council on pharmaceutical activities, which had been formed by the representatives of 10 professional associations, took place, the Pharmacy Professional Association of Ukraine reported.

The meeting participants suggested that among the most important goals of the industry are the acceptance of new license conditions and completing of reorganization of the State Administration of Ukraine on Medical Products. Additionally, the experts stressed the necessity of the adoption of the Law of Ukraine “On Drugs”, which allows to implement modern European standards of conducting pharmaceutical activities. During the meeting the attention was payed on compliance with the rules of Rx drugs release as well as the activity of drugs importers and amendments to the rules regulating it. The MOH started the development of policy on drugs provision

announced the development of the national DrugPolicy, aimed at provision of drugs to the population. The working group on the national policy development will work on nine directions:

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selection of essential drugs; availability of drugs; financial systems for drugs provision; drugs supply systems; regulation and assurance of drugs;

quality

rational use of drugs; drugs study, covering operational and clinical studies; human resource development; monitoring and assessment.

The MOH said the first results are expected in a month.

On Jan 26, the MOH has

Ukrainian Pharmaceutical Market Monthly: January 2016


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