Interview with Denis Bogomolov, CEO, Russia and CIS, Stada
Published on 24 April 2020 by Anna Andriyanova
Adam Smith Conferences: How is the new coronavirus pandemic currently affecting the Russian pharmaceutical market?
Denis Bogomolov: The COVID-19 pandemic has led the Government to take a number of decisions that the pharmaceutical industry has been awaiting for a long time. First of all, this is the legalisation of distance selling of medicines. We see this as a good opportunity to increase the availability of drugs for patients.
In addition, the Government has instructed the constituent entities of the Russian Federation to deploy an electronic prescription system in the nearest future and has prepared a bill on telemedicine. All this together – telemedicine, e-prescriptions and distance selling - can form an ecosystem of digital medicine provision, making the pharmaceutical market significantly more transparent.
Adam Smith Conferences: What changes might we expect in the coming months - what challenges are the pharmaceutical companies facing and what is being done to minimize the risks?
Denis Bogomolov: The task of all major pharmaceutical companies, including STADA, is to monitor demand and balances in the supply chain as quickly as possible in order to plan supplies and minimise the risks of stock-outs. For us, rapid data exchange and operational logistics are becoming the key element in providing patients with medicines.
Adam Smith Conferences: What measures is your organization taking to ensure steady supplies of medical products to patients and hospitals during the crisis?
Denis Bogomolov: STADA is one of the leading companies in the retail pharmaceutical market in Russia and a leader in the Consumer HealthCare segment. Production at the company's facilities around the world is in full swing, with the release of vital drugs being a priority. Since the coronavirus began to spread, STADA has begun to carefully monitor the potential impact of the epidemic on drug supplies. We maintain close contacts with producers of raw materials, industry associations and authorities, continuously analysing potential risks.
Currently, STADA has no supply problems due to coronavirus, we have good supplies of raw materials, which will last for several months. The company has many secondary sources of supply of pharmaceutical substances, so we are not dependent on one source.
Moreover, in March, STADA increased its production volumes. It reached a record high, for the first time in the company’s 125-year history exceeding the average production rate by 10%.
Adam Smith Conferences: What kind of state support and what strategic decisions do companies operating in Russia need to respond to the current circumstances?
Denis Bogomolov: The pandemic is already affecting the price and assortment of medicines for Russian patients, and we, together with the regulator, are obliged to take all necessary steps to minimise possible risks to medicine provision.
First of all, given the potential impact on cross-border supply chains, it is necessary to allow for the possibility of making quick changes to the drug dossier (which will be necessary if the import of active substances is restricted) and to simplify the procedures for registering new drugs. This will help to maintain the availability of medicines for Russian patients if more countries prohibit or restrict exports.
Secondly, given the importance of remote working methods during a pandemic, special attention should be paid to the digitalisation of the industry. And this is not only distance trading - it is necessary to provide a regulatory framework for electronic prescription systems and remote medical consultations - transferring contact with doctors and pharmacists to a remote format as far as possible.
Adam Smith Conferences: The situation with the new coronavirus threatens the existing business models around the world. Does the current crisis open any opportunities for future developments in pharmaceutical industry?
Denis Bogomolov: Before the coronavirus epidemic, like our other industry colleagues, we made visits to pharmacies and doctors face-to-face. Now, due to the difficult situation with the epidemic, we have switched to interacting remotely with them using digital tools. I am sure that digital models of interaction with the medical community and pharmacists will move to a new level as a result of the current situation. Doctors and pharmacists will also be more open to digital interaction.
Much in the industry will change due to the legalisation of distance selling of drugs. We expected the Government to take this decision earlier, so we had started preparing for the introduction of this channel in advance. We value our partners in the pharmaceutical market - distributors and pharmacy chains - and we will expand our cooperation on delivery with all of those ready for the new realities.
We are also considering the possibility of interacting with new drug delivery channels, so that high-quality and safe medicines are available to the maximum number of patients at a fair price. In this way, we continue to follow our mission - to take care of people's health as a trusted partner.