Pharmaceutical companies and EBRD gathered in Kiev to talk about financing needs
Pharmaceutical industry in Ukraine has potential for growth; at the same time, the sector needs reform and better access to financing, the European Bank for Reconstruction and Development has said today in Kiev.
The EBRD, which has already worked with a number of pharmaceutical clients in Ukraine, has gathered prominent companies to discuss challenges and possible solutions at “Breakfast with the EBRD”. The event was held in the morning of the second day of the 2014 Ukrainian Pharmaceuticals Forum organised by Adam Smith Conferences.
Florence Bachelard-Bakal, the EBRD’s Head of Manufacturing and Services for Ukraine, said: “Pharmaceutical sector is very important for Ukraine, and not only in purely economic terms but also because locally produced medicines are much more affordable than imported ones. At the EBRD, we set ourselves three tasks in the sector: to help pharma companies reach international industry practices; to help them with energy efficiency improvements; and of course to support the industry with long term funds which are essential for capital expenditure and innovative product development.”
Iryna Marchenko, senior banker at the EBRD’s office in Kyiv, added: “Even today, the pharmaceutical sector in Ukraine can be attractive for foreign investment, as many Ukrainian manufacturers already comply with Good Manufacturing Practice standards (GMP) required in the EU and many other countries globally. There is also a lot of scope to introduce advanced technologies and “first to the market” generic drugs in order to replace expensive imports and old, low value generic medicines”.
The EBRD has invested over €500 million in the pharmaceutical industry in its region of operations, including close to €95 million in Ukraine. Most recently, the EBRD signed a loan agreement with Farmak for up to €8.5 million to provide working capital and access to hard currency, which is a third EBRD loan to the company. Currently the Bank is considering two more projects in Ukraine’s pharma sector to the total of €15 million. “There is scope to finance more viable pharmaceutical projects in the country”, adds EBRD Director for Ukraine, Sevki Acuner.
For the EBRD, the pharmaceutical industry is an important component of its Knowledge Economy Initiative, whereby manufacturers rely on a steady stream of innovations to boost general productivity and competitiveness. In the sector, the Bank supports pre-privatisation projects, assisting upgrades of existing pharmaceutical facilities to increase production efficiency, new product development, and bringing companies up to Good Manufacturing Practice (GMP) standards. The EBRD will also consider companies that aim to produce original pharmaceuticals.
In 2014, the Bank is committed to investing around €1 billion in Ukraine in various sectors, which includes credit lines to support existing clients in the manufacturing sector through challenging times.