[HEADING 1]

1
in the region for many years, but current
economic situation is expected to change in
2015, which will adversely affect medical device
market growth, as less money is made available
for healthcare. Additionally, imports may fall as
the currency devaluation has made foreign
products very expensive.
Healthcare sector in Russia
The Russian Healthcare market is a market in
growth. The lack of efficient tools and
equipment with a growing elder burden is a
development that Denmark and the Danish
system know very well. Here the Danish
companies are in the forefront of developing
innovative and efficient solutions. However the
structure of the market is challenging and the
financial situation is adding to the challenge.
Even with these challenges there are Danish
companies on the market working hard and
earning money.
In 2013, the Russian medical device market was
estimated at USD 6,716.9mn, or USD 47 per
capita. This market size is comparable to
Canada; in per capita terms, the market is
similar to Croatia. The 2008-2013 CAGR was
estimated at 0.3%, but the market is expected
to contract by a CAGR of 2.9% over the 20132018 period, to USD 5,785.2mn, or USD 41 per
capita by 2018.
The Russian healthcare system is divided into
national, regional, and municipal levels. The
national government controls the budget, policy,
and registration of technologies, while regional
and municipal governments have control over
their facilities and budgets. The national
government collects taxes and distributes funds
to the regional and municipal levels through
Mandatory Health Insurance funds. This covers
about two-thirds of the cost of procedures. To
make up the difference, Russian citizens also
have access to voluntary health insurance and
private medical care. This system continues to
evolve. In 2010, the government implemented
the
Strategy
2020 initiative
to
attract
investment, create jobs, produce safe and
effective products, and reduce the country's
dependence on foreign healthcare products to a
maximum
of
50%
by
2020
(Source:
http://medtechinsider.com/archives/25933). In
January 2013, the government approved a
national healthcare development plan for the
2013-2020 period. The programme consists of
11 initiatives that focus on several areas
including preventive care, health & wellbeing of
mothers
&
babies,
and
medical
rehabilitation/physiotherapy. The government's
national Health project aims to improve
healthcare standards. Since the project's
implementation, numerous medical facilities
have been upgraded.
Over 70% of the medical device market is
supplied by imports. Russia imported medical
devices valued at USD 4,848.9mn in 2013; this
represented a fall of 21.8% compared with 2012
and a 2008-2013 CAGR of 1.1%. Imports have
grown every year since 2003, with the exception
of 2009 and 2013. In the 12 months to
September 2014, Russian medical device
imports
decreased
by
26.1%,
to
USD
4,525.5mn.
REHABILITATION EQUIPMENT
According to a market research of rehabilitation
services conducted by Synopsis medical
research centre in 2012, about 12% of the
population of Russian Federation suffer from
chronic diseases of the musculoskeletal system.
The growing number of such patients increase
the demand for rehabilitation services.
Rehabilitation centres located in Leningrad and
Moscow regions (including recently started
projects) seem to be more interesting target
group. Nowadays both individual and corporate
investors are interested in this sector. During
the last two years a number of new projects of
rehabilitation centres were initiated both in
Moscow and Saint Petersburg
One can also notice that a range of services is
growing and a comprehensive approach to
rehabilitation is being implemented.
MEDICAL DEVICES
The Russian medical device market is expected
to contract by a CAGR (compound annual
growth rate) of 2.9 % over the 2013-2018
period, due to the weakening of the ruble.
Russia was one of the fastest growing markets
Most popular rehabilitation equipment:
training simulators (cardiovascular‐,
bike‐ and bodysimulators for the
different groups of muscles and joints)
2
Equipment
for water treatment
(Charcot’s
douche,
multifunctional
medical baths etc.)
walking aids
equipment for the massage and manual
therapy
Rehabilitation equipment may also be acquired
by rehabilitation clinics located in resort areas
(Krasnodar region, the Caucasus etc.)
The
introduction
of
new
methods
of
rehabilitation seems to be not so complicated as
introduction of new diagnostic and treatment
technologies.
Home
care
rehabilitation
equipment is also in demand.
most popular devices imported
(Source: FINPRO consulting)
-
to
Russia.
PHARMA
The pharmaceutical industry in Russia has been
witnessing strong growth over the last couple of
years, with the alimentary/metabolism segment
leading the market. The industry grew by
17.5% in 2009 and is expected to reach a value
of
$10.7
billion
by
the
year
2014.
The Russian pharmaceutical market accounts for
just 3.6% of the European pharmaceutical
industry in terms of value.
Both exercise therapy and physiotherapy are
very popular methods of medical rehabilitation
since the Soviet times. Nearly all public and
private clinics are equipped with basic
physiotherapy equipment.
Both public and private sectors are mainly
equipped with Russian made physiotherapeutic
technique. Nowadays Russian manufactures
produce more than 100 types and 15000
positions of different physiotherapeutic devices.
Their lifetime is 10‐15 years, but there are a lot
of 20‐25 year old devices still in use. On the one
hand, this is an evidence of high quality of
domestic production; on the other hand, the
time has come to replace those old devices with
new and modern ones. International standards
for rehabilitation services have changed,
patients
demands
have
diversified
and
increased, and there is a clear demand in Russia
for new physiotherapy equipment. However, it is
necessary to say that the situation in private
healthcare sector is not so crucial and an
average lifetime of physiotherapy equipment in
use is only 7 years. Besides healthcare
institutions,
potential
clients
to
buy
physiotherapy equipment are nursery schools,
private secondary schools and sanatoriums.
Russian manufacturers of this equipment are far
beyond their western competitors both in design
and efficiency of their products, but it is hard to
compete with them on price. Thus a foreign
supplier of physiotherapy equipment, who is
interested in Russian market, should carefully
examine the market situation and clearly draw
out its competitive advantages in comparison to
local competitors.
The
leading
importers
of
physiotherapy
equipment come from the Czech Republic,
United
Kingdom,
Japan
and
Germany.
Orthopaedic devices & prosthesis are among
Despite global economic downturn Russian
pharmaceutical market remains strong and
continues to attract foreign companies. With
sales of medicinal products exponentially rising
over the last 10 years, both large and midsize
Pharma are actively expanding its presence in
the Russian market. The forecast for the next 10
years
suggest
a
robust
growth
of
pharmaceutical sales.
(www.cromospharma.com)
At present time Russian pharmaceutical and
medical device market is hugely dependent on
outside import. There is a difference of
allocation of the state resources, when it comes
to medical equipment, which is mostly state
funded and pharmaceuticals, mostly a retail
market. Medical equipment and pharmaceuticals
(public sector accounts for around a quarter of
Russia’s pharmaceuticals market) are procured
for use in the public sector via electronic
tenders, organized in accordance with the
recently revised general state procurement
legislation. However, in early February 2015 in
the framework of the anti-crisis plan and import
3
replacement measures the Russian government
restricted state purchases of certain imported
medical equipment and goods. Also, the
ministry of industry and trade just came up with
a proposal to restrict admission to tenders of
imported pharmaceuticals, if there are two or
more
proposals
to
deliver
similar
pharmaceuticals from domestic producers.
prescription products at 51% and for OTC drugs
at 49%.
(Source: http://www.dsm.ru/about/news/100/).
What can the Trade Council do for You?
Trade Council Russia can assist you in finding
reliable Russian business partners, locating
potential partners, searching for enterprises
which meet specific requirements and select the
most compatible. Trade Council Russia can be of
help by providing all necessary contacts,
organize meetings and negotiations with
representatives of Russian companies. We offer
market visits to Russia and Kazakhstan which
might be of interest to newcomers to our
markets.
The Russian pharmaceutical market ranks
second in volume terms after the foodstuff
market and is one of the most dynamic and
promising specialized markets. The Russian
pharmaceutical market ranks among the top ten
pharmaceutical markets in the world. In 2011,
Russia was 8th in the world. The value of the
Russian pharmaceutical market was 28.1 billion
USD in end-user prices, which is a 12% increase
compared with 2010. (Source: DSM Group).
The volume of the market for pharmaceuticals
in pharmacy procurement prices decreased by
6,8% in November 2014 in comparison with
October 2014 and totalled up to 44,7 bln RUR.
The average price of a pharmaceutical package
increased for 2,9% and ran at 130,4 RUR in
November 2014.
From the beginning of 2014 the inflation rate for
pharmaceuticals at the pharmacy shops of the
country totalled at +8,5% in RUR and -21,1% in
US dollars.
Svetlana Chernova
The market structure of pharmaceuticals did not
change radically in November 2014 in
comparison with the same period in 2013. The
reduction of quantity of pharmaceuticals with
the price range of 50-150 RUR per package
continued in 2014 (from 20,3% in November
2013 to 17,6% in November
2014),
pharmaceuticals of the lowest price segment
(i.e. cheaper than 50 RUR per package) saw
reduction of the market share from 7,3% to
6,7%. And pharmaceuticals with price tag of
500 RUR per package shared 28,4% of the
market in November 2014 which is 2,1% more
than in November 2013.
Commercial Attaché
Head of the Healthcare sector advisory team
E-mail [email protected]
At the end of November 2014 г. 55% of
pharmaceuticals sold were of domestic origin (in
physical terms) however due to their low price
in
comparison
with
the
imported
pharmaceuticals in terms of value they show
24% of sales.
The commercial segment of the market at the
end of November 2014 was presented by
4