Bio-pharma Opportunities in Moscow

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Bio-pharma Opportunities in Moscow

• http//moscow.e-regulations.org/
• OCO Global

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Contents

1. Why invest in Moscow 3
2. Bio-pharma sector Overview 6
3. Moscows location advantages 12
4. Contact us 19

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• Why invest in Moscow?
• Critical investment drivers
• Economic overview

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Why Moscow?

• Educated and experience workforce
• Labour force of 8.5 million people - One of the
  largest concentrations of skilled labour in
  Europe
• Over 24,000 people employed in Pharma industry
  more than the double that of Singapore
• 9 Universities with Life Science courses
• Extensive R D community
• Over 30 researchers per 1,000 employment higher
  than in Budapest and in Prague
• 8 research instiutes specialised in Biotechnology
• Access to the highly dynamic market
• Consumer market of more than 10 million people
  (142.8 million in Russia)
• GDP per capita of more than USD 15,000 2.5
  times higher than Russias average
• Average income growth of more than 20 annualy
• Moscow has modern, first class infrastructure
• Over 150 international destinations served from
  two airports
• 9 international schools
• 4.4 million Internet users
• 1.2 million Broadband subscribers

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Why Moscow? Economic overview

• GRP US 1.7 billion
• GRP growth 9
• Per capita GRP US 15,200
• Inflation 11.9
• Population 10.43 million
• Employment 8.48 million
• Unemployment rate 1.1
• 2 airports serving around 160 international
  destinations
• Broadband subscribers 1.2 million

Sources Goskomstat, 2006 Moscow Government,
2006 ONG Guide, 2006 Reksoft, 2007
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Bio-pharma

• Key facts
• Leading players
• Research capacities
• Success cases
• Business associations

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Bio-pharma Sector Kew Facts

• Market size US 10.4 billion
• Market size forecast US 1.3 trillion by 2020
• Growth rates 15.9
• Per capita spending US 75
• Demographic trend 17.3 of population aged 60
  or over compared to 16.5 in 1990
• Imports 69
• Key sales segments alimentary track and
  metabolism ailments, nervous system drugs,
  cardiovascular system drugs
• Local enterprises around 200 companies of
  various size
• State programme Beneficiary Drug Provision
  Programme (provision of medicines subsidized
  by the federal government to registered
  welfare recipients) with announced budget of
  US 2.45 billion in 2008
• Key investors KRKA, Searle(Pfitzer), Servier,
  Cerep, Icon

Sources Espicom Business Intelligence Report,
2007 PricewaterhouseCoppers, 2007, Dun
Bradstreet Pharmexpert, 2006 Pharmstandard OCO
Monitor In Moscow and Moscow region
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Bio-pharma Sector Leading players

• Pharmstandart holding Established in 2003 in
  Moscow. The leading Russian pharmaceutical
  company accounting for over 15 of domestic
  pharma production. Five manufacturing facilities
  in Russia with 2 of which comply with EU GMP
  certification. The company produces 5 out of 15
  top selling domestic brands with main
  therapeutics segments including cough and cold,
  vitamins, antiviral and analgesics. IPO of the
  company took place in 2007. http//eng.phstd.ru
• Otechestvennye Lekarstva Established in 1997 in
  Moscow, the company now has over 5,000 employees.
  Produces over 200 brands in its 3 locations in
  Russia. The company provides for over 16 of
  Russias pharma exports. Overseas expansions
  include Ukraine, Kazakhstan and Vietnam.
  http//www.hotlek.ru/about_comp.php
• Microgene Established in 2003 in Moscow.
  Producing over 70 of all vaccines in Russia the
  company is the leading developer and producer of
  immuno-biological medicines. It has established
  links to the leading research institutes in
  Russia specialising in vaccines and
  biotechnology. In its 17 branches across Russia
  the company employs 7,500 staff.
• Veropharm Established in 1997 in Moscow.
  Russias leading producer of oncological
  medicines. The company has 3 manufactuiring
  facilities in Russia and employs over 3,000
  people. Companys IPO took place in 2006.
  http//www.veropharm.ru/eng/index.wbp
• Leading Russian distributors SIA International,
  Protech, Katren NPK, ROSTA, Genesis, Biotech

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Bio-pharma Sector- Research Capacities

• Institute of Immunological Engineering - Was
  founded in 1979 and has a remit to develop
  specific means of protection against dangerous
  diseases and to undertake research in the fields
  of immunology, microbiology, bioengineering and
  biotechnology. The Institutes staff consists of
  65 research officers, 36 are researchers,
  including 6 doctors of science (5 professors) and
  21 Ph.Ds.
• A.N. Bach Institute of Biochemistry Established
  in 1934. The institutes focus is on the research
  of the biochemical foundations of vital processes
  and application to production. http//www.inbi.ras
  .ru/english/struct-eng.html
• Research Institute of Epidimology and
  Microbiology named after N.F. Gamalei
  Established in 1891. Main focus is on the
  fundamental research in the field of epidimology,
  molecular microbiology and infectious immunology.
  http//www.gamaleya.ru/content/institute/index.htm
  
• Institute of Biomedical chemistry is a structural
  subdivision of Russian Academy of Medical
  Sciences. It has 200 research staff in its 8
  laboratories. The Institute carries out study of
  genetic, molecular, biochemical, physiological
  and morphological principals of vital activity to
  prevent diseases and renew unsound functions.
  http//ibmc.msk.ru
• Gause Institute of New Antibiotics - Established
  in 1953. Has 7 scientific laboritories and 147
  staff inclduing 74 scientists and 33 doctors. The
  Institute is invoved in new antibiotics discovery
  with the focus on antibacterial, antitumoral and
  antivirus antibiotics, ray fungus taxonomy
  researches, development of new methods for the
  most complete microbe diversity detection, etc.
  It also carries out pre-clinical trials.
  http//www.gause-inst.ru/e_main.html

Examples of bio-pharma research organisations
in Moscow
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Bio-pharma Sector Recent Success Cases

• Cerep (France) Opened its operation in Moscow
  in 2007 through the fully owned subsidiary
  Hesperion Ltd. The office located in Orbita
  Technopark Business Center and offers Clinical
  Operations and Regulatory Affairs services as
  well as Project Management and Drug Storage. The
  staff members of the new Russian office are
  highly qualified and multilingual and will cover
  the Eastern Europe area.
• Servier (France) Established its manufacturing
  facility in 2007 in Sophyno (near Moscow) with
  the investment of 40 million. By 2012 Servier
  plans to produce 60 million boxes of medicines
  per year and to employ 180 staff.
• JB Chemicals Pharmaceuticals Ltd (India) In
  2005 invested 3 million in a wholly-owned
  subsidiary in Moscow. Creation of Moscow
  sub-division strengthened the company position on
  pharmaceutical markets of Russia and other
  countries of the former USSR, which provide
  together 45 of JB Chemicals Pharmaceuticals
  profits.
• Icon Clinical (Ireland) In 2005 opened a RD
  center in Moscow for its clinical operations.

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Bio-pharma Sector Useful Links

• Ministry of Healthcare and Social Development of
  Russian Federation www.mzsrrf.ru
• Association of International Pharmaceuticals
  Manufacturers http//www.aipm.org/eng/
• Association of Russian Pharmaceutical
  Manufacturers http//associaciya.arfp.ru/
• Association of European Business in Russia
  (Healthcare and Pharmaceuticals Committee)
  http//www.aebrus.ru/committees/industrial/health/
  
• American Chamber of Commerce in Russia
  (Healthcare Committee) http//www.amcham.ru/commit
  tees/healthcare
• Pharmexpert (research company specialising in the
  pharma industry) www.pharmexpert.ru
• DSM Group (marketing research and advertising
  service on the Russian pharmaceutical market)
  http//www.dsm.ru/en/about_us/

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• Moscows location advantages
• Competitive position
• Economic growth
• Market growth
• Employment/skills
• RD capacities
• Infrastructure

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Location advantages competitive position
Moscow provides very good opportunities for a
bio-pharma manufacturing project due to its
highly competitive position in Eastern Europe
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Location advantages market growth

• Russia was the fastest growing pharma market in
  2006, ahead of Brazil and China. Moscow is the
  largest segment of the Russias market its
  size in 2008 is estimated at around USD 2 billion.

Pharma marketsize (USbn) 8.4 8.4 11.4 13.7 8.1 197.8 11.6 25.6 15.7 27.7 14.9 5.8 56.7
Sources Pharmexpert DSM
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Location advantages - employment/skills

• Labour force of 8.5 million
• Over 800 students per 10,000 population
• 30 researchers per 1,000 employment
• Over 24,000 people employed in Pharma sector
• 8 Universities providing courses in Life Sciences

• Social security paid by employers 26
• Average working week 40 hours
• Statutory holidays 10

Source Moscow Government Goskomstat Statistics
on Russian Education Watson Wyatt
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Quality factors RD capacities

• Patents Russia has the highest number of biotech
  patent applications in Eastern Europe with Moscow
  being the driving force behind this indicator
• Research institutes Moscow has been
  traditionally strong in its research capacities
  in the field of medicine, pharmaceuticals,
  biology and biotechnology. Moscow hosts the
  highest number of biotech research institutes in
  Eastern Europe

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Quality factors Infrastructure

• Connectivity Moscow has a developed, efficient
  infrastructure . Moscows 3 international
  airports serve over 150 international locations
  more than any major city in Eastern Europe
• International schools Moscow is an attractive
  location for expatiates. There are over 90
  theaters and 60 museums. In addition, Moscow has
  the highest number of international schools with
  International Baccalaureate certificate in
  Eastern Europe

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Contact us

• http//moscow.e-regulations.org/
• info_at_miepa.org
• T. 7 [phone]