Pharma Investment in Russia Continues Despite Economic Downturn
Forecasts for the Russian pharmaceutical market have taken a nosedive in early 2016 compared to the third and fourth quarters of 2015. At a recent DCAT event, IMS Health’s Graham Lewis forecast negative (–3%) to flat growth in the Russian pharma market through 2019.
This stands in sharp contrast to estimates published in late 2015. IMS Health had estimated in a report last year that the Russian pharma market rose about 12% over 2014. And forecasts by Deloitte Consulting had estimated the market could grow at about 10%/year through 2018, potentially reaching $25.62 billion by that time, a rate that could have made Russia the eighth-largest pharmaceutical market in the world by next year.
Lewis noted that BRICs are generally down due to slumping oil prices and a struggling economy, along with internal and external political turmoil that pressures both government budgets and corporate profits.
Plunging oil prices, political unrest and a variety of Western sanctions have pressed the Russian economy, agreed an analyst with the US Chamber of Commerce. The Russian economy was down about 3.7% in 2015 compared to 2014.
But the Russian pharma market is still significant and the country seems to remain attractive to global pharma companies, despite the economic uncertainty and a host of regulatory challenges. Several pharma companies are investing in capacity in Russia. An anticipated boom in clinical trials has led to growing interest in clinical manufacturing, packaging and distribution capacity, in particular.
This article is reprinted from the March issue of Emerging Markets Outsourcing Report. The full article addresses the opportunity in the Russian pharma market. To learn more, click here.