Some of the biggest and most prestigious drug companies are planning expansion across Europe and into the Balkans
emand
for pharmaceutical products has grown considerably in recent years with
overall expenditure reaching $1.64 billion, up from $1.09 billion in
1995.
There is still room for further expansion in the domestic market. Many
wholesalers choose to export medicines rather than distribute them locally
because of the current regulated pricing structure, and this has resulted
in shortages at times.
Industry concerns over the pricing policy, which keeps drug prices artificially
low in the local market, have resulted in a major review of the way
the system works by the Ministry of Development.
The
Drugs Prices Committee had been seeking to approve a new price list
for 124 medicines using the existing formula, which is determined on
the basis of the lowest price elsewhere in Europe.
At the end of last year, major drugs companies won backing from the
Council of State, the country’s highest court, to annul the present
tightly-regulated system, which dates back to 1997.
Pharmaceutical companies in Greece blame this system for the sharp rise
in exports of drugs in recent years and the decline in domestic production.
In the past five years, exports leapt from $43.2 million to around $261.86
million today.
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Greece
boasts some of the world’s biggest and most prestigious names in
the pharmaceutical business, including Aventis,
the multinational formed from the merger of France’s Rhobe-Poulenc
and Hoechst of Germany in 1999.
Dr Leonidas Crassaris, head
of Athens-based Aventis Pharma and the Hellenic Association of Pharmaceutical
Companies, hopes to see the European Union gaining greater influence
in the market, which will ultimately affect pricing and other policies.
He says: “Some things have already improved in Greece due to the
European legislation that has been imposed. Unfortunately, the commission
has left each government free to arrange for the social welfare and
security of its people.”
Still, as a business, Aventis, which is strong in a wide range of drugs,
from diabetes to cancer treatment, is showing promising growth in its
early years. Mr Crassaris wants the company, which competes against
big players such as Novartis
and Glaxo SmithKline, to be the best in the local market. He also sees
Greece as a base for tapping overseas markets such as the Balkan states.
“We
are now stronger in all the areas we existed in before because of synergy,
and when I say synergy I mean it in the Greek sense of working together
and not in the American sense which means savings,” adds Mr Crassaris.
Aventis recently sold its L’Aigle production site in western France
to Famar, part of
Greece’s Marinopoulos group and one of the rising stars of the
domestic industry. The facility will produce and package pharmaceutical
products such as pills and capsules for clients that include Aventis.
Famar, a service provider to the healthcare sector, which develops and
produces pharmaceutical products and offers packaging services to the
multinationals, is rapidly expanding its operations across Europe. In
recent years, it has emerged from a traditional, Greek family-run business
into a professionally-managed corporate with a global outlook.
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Famar
president Panos Marinopoulos
says the company is hoping to continue its expansion in Greece and across
Europe by investing in new facilities and acquiring more sites, with
the aim of creating specialist centres of excellence for manufacturing
individual products.
“We will be expanding in Europe and acquiring more sites, which
bring a lot of people and a lot of business. Once we create a network
in Europe, we are going to specialise sites,” says Mr Marinopoulos.
“One of our main strategies involves specialisation, through which
you can gain more flexibility and productivity, while saving costs.
If you have a plant producing lots of unquoted tablets then this is
a centre of excellence for the tablets. When you create that, it is
very difficult for anyone else to do better and it will be difficult
for a client to be dissatisfied with you.”
Mr
Marinopoulos believes Famar’s strength in the Greek market lies
in its ability to sell local expertise to the big multinationals, forming
mutually beneficial joint ventures. “We put on the table what we
offer and they put on the table what they want, and then we find a way
to collaborate and form a joint venture.”
Famar has been successful in meeting the changing demands of its bigger
clients, as and when they arise. “Famar is a service provider and
is doing just that,” says Mr Marinopoulos. “It is following
the needs of its clients, but when the client needs physical distribution,
Famar will provide it. If the client needs development, Famar provides
that as well.”
This is a strategy the company hopes to continue in the foreseeable
future in order to boost further growth. “We will be looking at
our clients since they are global and we would like to follow them.
They are showing us the way and we will be doing what is required,”
adds Mr Marinopoulos.
Famar is also helping Novartis (Hellas) – the Greek arm of Swiss
pharmaceutical giant Novartis – to adjust to some of the peculiarities
of the local market in terms of packaging, transport and distribution
methods.
The past five years have seen a sharp rise in exports
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Novartis
(Hellas) president Michael Pluss
believes the partnership is a crucial one. “The advantage with
Famar is that, because it works with other companies, it is exposed
to more policies of quality assurance. I would say that it has pushed
us to an even higher standard.”
Novartis is actively looking to develop its Greek business as well as
its global position. It has just received approval for the use of its
ground-breaking new drug for the treatment of myeloid leukaemia from
Greece’s National Pharmaceuticals Organisation.
Mr Pluss says Novartis has developed a strong corporate identity and
wants to be the best in the business. “Basically, what makes us
feel strong is that we want to extend, improve and save lives. This
gives a strong direction to your research as well. And this has given
a strong signal to all our affiliated companies.”
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