scholarly journals Ukraine's pharmaceuticals: from dependence to endogenous development

2020 ◽  
Vol 2020 (4) ◽  
pp. 5-33
Author(s):  
Olena Salikhova ◽  
◽  
Daria Honcharenko ◽  
◽  

The article substantiates various theoretical and applied principles of developing high-tech pharmaceutical industries (HTPI). It is established that the key problem of developing countries in this area is the dependence on resources and markets of developed countries, while the involvement of advanced foreign technologies can be a catalyst for increasing the technological potential of host countries (subject to the availability of proper knowledge and human capital, changes in the institutional environment, and improved the framework conditions for innovation). In the context of the development of HTPI, the author shows the importance of the network nature of the acquisition by pharmaceutical companies of sustainable competitive advantages based on resources that are difficult to simulate or replace. It is substantiated that networks built with local research institutions, higher education institutions, and research units of other companies, give pharmaceutical manufacturers the opportunity to access complementary assets and become their specific resource, which provides unique competitive advantages. The author reveals various methodological and statistical features of the categorization of industries by the level of technology in the conditions of globalization. It is substantiated that the current low value of the ratio of research and development (R&D) to value-added generated by pharmaceuticals of individual countries is not a sign of the industry’s low technological level, as the current revenues are the result of long-term R&D and harmonization procedures for launching new drugs with lags of 10-15 years. A new tool for the study of international trade in high-tech pharmaceuticals is proposed, whose peculiar feature consists in the categorization of nomenclature items by end use; the List of high-tech medical and pharmaceutical intermediate goods is formulated (in accordance with SITC Rev.4 and UKT FEA); the following indicators are proposed: the coefficient of import dependence of pharmaceutical production, the coefficient of "purified" exports of pharmaceutical products and the coefficient of imports coverage with HTPI output, and the formulas for their calculation are provided. The author's approach is the first to create the opportunity to assess the scale of costs and the dependence of the pharmaceutical industry on imported components that embody advanced technologies and are the industrial supplies for HTPI. It was found that in Ukraine the share of foreign intermediate high-tech goods in the consumption of the industry reaches 82.2%; the industry, working on imported substances, produces mainly products for the domestic market, without earning foreign currency, even to cover the cost of purchasing the necessary ingredients; manufacturers do not rely on synthesized chemical products of domestic production, primarily due to the fact that the products of the chemical industry for the needs of pharmaceuticals in Ukraine are virtually non-existent; and the increase in output depends on foreign technologies and intermediate goods. It is substantiated that Ukraine’s pharmaceutical industry is critically dependent on imported supplies to ensure the smooth operation of enterprises and the healthcare industry. Key endogenous barriers that hinder the development of HTPI have been identified, including problems in the training of specialists and a lack of scientists whose competencies would contribute to solving the problems of endogenous development of the industry; lack of state aid to business entities for research, and technological and innovative activities; lack of own funds to increase expenditures on R&D and implementation of large-scale investment and innovation projects; and lack of cheap loans, due to which Ukrainian pharmaceutical manufacturers find themselves in unequal conditions compared to foreign competitors. Conceptual bases of HTPI development in Ukraine are proposed; justified the expediency of legal changes, definition of strategic priorities and introduction of measures of development of HTPI in Ukraine based on the comprehensive approach, which will cover creation and development of pharmaceutical ingredients for medicines (chemical and biotechnological goods), medical products, fillers, packing materials, machinery and equipment for pharmaceuticals to help reduce the dependence on foreign technologies, and to increase the level of production localization, employment and revenues to the budgets of all levels.

2020 ◽  
Vol 2020 (4) ◽  
pp. 7-35
Author(s):  
Olena Salikhova ◽  
◽  
Daria Honcharenko ◽  
◽  

The article substantiates various theoretical and applied principles of developing high-tech pharmaceutical industries (HTPI). It is established that the key problem of developing countries in this area is the dependence on resources and markets of developed countries, while the involvement of advanced foreign technologies can be a catalyst for increasing the technological potential of host countries (subject to the availability of proper knowledge and human capital, changes in the institutional environment, and improved the framework conditions for innovation). In the context of the development of HTPI, the author shows the importance of the network nature of the acquisition by pharmaceutical companies of sustainable competitive advantages based on resources that are difficult to simulate or replace. It is substantiated that networks built with local research institutions, higher education institutions, and research units of other companies, give pharmaceutical manufacturers the opportunity to access complementary assets and become their specific resource, which provides unique competitive advantages. The author reveals various methodological and statistical features of the categorization of industries by the level of technology in the conditions of globalization. It is substantiated that the current low value of the ratio of research and development (R&D) to value-added generated by pharmaceuticals of individual countries is not a sign of the industry’s low technological level, as the current revenues are the result of long-term R&D and harmonization procedures for launching new drugs with lags of 10-15 years. A new tool for the study of international trade in high-tech pharmaceuticals is proposed, whose peculiar feature consists in the categorization of nomenclature items by end use; the List of high-tech medical and pharmaceutical intermediate goods is formulated (in accordance with SITC Rev.4 and UKT FEA); the following indicators are proposed: the coefficient of import dependence of pharmaceutical production, the coefficient of "purified" exports of pharmaceutical products and the coefficient of imports coverage with HTPI output, and the formulas for their calculation are provided. The author's approach is the first to create the opportunity to assess the scale of costs and the dependence of the pharmaceutical industry on imported components that embody advanced technologies and are the industrial supplies for HTPI. It was found that in Ukraine the share of foreign intermediate high-tech goods in the consumption of the industry reaches 82.2%; the industry, working on imported substances, produces mainly products for the domestic market, without earning foreign currency, even to cover the cost of purchasing the necessary ingredients; manufacturers do not rely on synthesized chemical products of domestic production, primarily due to the fact that the products of the chemical industry for the needs of pharmaceuticals in Ukraine are virtually non-existent; and the increase in output depends on foreign technologies and intermediate goods. It is substantiated that Ukraine’s pharmaceutical industry is critically dependent on imported supplies to ensure the smooth operation of enterprises and the healthcare industry. Key endogenous barriers that hinder the development of HTPI have been identified, including problems in the training of specialists and a lack of scientists whose competencies would contribute to solving the problems of endogenous development of the industry; lack of state aid to business entities for research, and technological and innovative activities; lack of own funds to increase expenditures on R&D and implementation of large-scale investment and innovation projects; and lack of cheap loans, due to which Ukrainian pharmaceutical manufacturers find themselves in unequal conditions compared to foreign competitors. Conceptual bases of HTPI development in Ukraine are proposed; justified the expediency of legal changes, definition of strategic priorities and introduction of measures of development of HTPI in Ukraine based on the comprehensive approach, which will cover creation and development of pharmaceutical ingredients for medicines (chemical and biotechnological goods), medical products, fillers, packing materials, machinery and equipment for pharmaceuticals to help reduce the dependence on foreign technologies, and to increase the level of production localization, employment and revenues to the budgets of all levels.


2021 ◽  
Vol 8 (3) ◽  
pp. 5-13
Author(s):  
P.S. Guryanov

Abstract. IThe purpose of the article was to study the main characteristics of the pharmaceutical industry in Morocco. As materials were studied the official websites of pharmaceutical manufacturers in Morocco, policy documents of industrial pharmaceutical associations, specialized pharmaceutical press of Morocco, educational resources of Morocco and France. As a result, it was found that the pharmaceutical industries of Morocco and Russia are already interacting with each other: BIOCAD supplies high-tech drugs and production technologies to Morocco, Morocco has placed an order with R-Pharm for the purchase of a vaccine against COVID-19, produced under the license of AstraZeneca, and also ordered a million doses of Sputnik V vaccine. Morocco is one of the fastest growing countries in the Middle East and Africa with an economy of $119 billion, a population of 37 million,andtotalhealthspendingof5.5%ofGDP.Expendituresforhealthcarearequitehigh-53.6%oftotalfamilyexpenditures. 31.7% of total health care expenditure is spent on drug purchases. The pharmaceutical industry in Morocco began to develop in 1960 after the end of the French protector and the introduction of the obligation to localize drugs sold in Morocco by foreign pharmaceutical companies. The pharmaceutical industry in Morocco is represented by 51 factories, which cover 2/3 of the country’s drug needs. Mostly generics are produced, 10% of production is exported. The volume of the issue is $1.68 billion (2nd place in Africa). The products are of high quality and certified according to European standards. Morocco is endeavoring to transform its pharmaceutical industry into a strategic asset for influencing African countries through the creation of an «African House of Medicines» based in Morocco, which is the manufacturing and logistics center for medicines in Africa. The main documents regulating the pharmaceutical industry are: Law No. 17-04 of 2006. “Code of Medicines and Pharmacy” and Order of the Minister of Health No. 902-08 5654 of 2008. “Requirements for the premises of pharmaceutical organizations.” Thus, we conclude that the Kingdom is a regional leader with ambitious plans and a large backlog that needs new technologies, markets for pharmaceutical products, a large number of qualified personnel, high-tech drugs at affordable prices. The intensification of cooperation between Russia and Morocco will help both countries to gain a foothold in the rapidly growing pharmaceutical market in Africa.


Author(s):  
Seyede Zeinab Mousavi ◽  
Saeed Rasekhi ◽  
Mina Golestani ◽  
Ali Imani

 Objectives: Competitiveness is the ability of countries in increasing market share, profits, value added, and staying at the scene of fair and international competition for a long period of time. This is realized through market authority and establishing activities based on comparative and competitive advantages. On the other hand, the research-based pharmaceutical industry makes a major contribution to the prosperity of the world economy. It is a robust sector that has been one of the pillars of industrialized economies and is increasingly recognized as an important sector in the developing world as well. Furthermore, global sales of pharmaceutical products represent the international spread of medical technology that comes as the result of highly intensive R and D efforts in the exporting countries (International Federation of Pharmaceutical Manufacturers and Associations, 2012). The present study aimed to analyze and investigate the international competitiveness of pharmaceutical sector in selected developed countries using traditional and new indices of competitiveness.Methods: In this study, revealed comparative advantage index and also static and dynamic intra-industry trade (IIT) indices were used in the period 2000–2012.Results: The results indicated the growing competitiveness in most of the selected countries. Furthermore, the findings suggested that countries with higher levels of international trading of pharmaceutical goods have a higher potential of competitiveness based on IIT and comparative advantage indices.Conclusions: For increase in international competitiveness in pharmaceutical industry, selected developed countries pay attention to both comparative and competitive advantages.


2020 ◽  
Vol 89 (2-3) ◽  
pp. 48-58
Author(s):  
O. B. Salikhova

Specific ways of the emergence of new actors in the global market of pharmaceutical goods is investigated, with substantiating the role of transnational corporations (TNC), their investment and technologies in establishing pharmaceutical industries in developing countries. The cases of Puerto Rico and Ireland are taken in order to demonstrate the background for expansion of manufacturing of medicines and medical products and analyze the tendencies in their export capacity building. The factors making pharmaceutical TNC transfer production facilities to India and China are substantiated and implications of this process are highlighted. It is revealed that due to the production internationalization, countries that had been net importers of pharmaceuticals just several decades ago have joined the group of key suppliers to external markets. Because American and European TNC are leading in the pharmaceutical industry by R&D expenditure, they are the principal holders of advanced technologies in the industry. It follows that manufacturing of medicines and medical products in most part of countries either directly or indirectly depend on innovative products of TNC and their technology transfer via various channels (both licensing and imports of components, active pharmaceutical ingredients in particular). It is shown that with the emergence of new market actors coming from developing countries, traditional approaches to determining comparative advantages of counties in the global trade need to be improved. The cases of countries that are recipients of foreign technologies, on which territories powerful high tech pharmaceutical production facilities with high shares of intermediate consumption and heavy export supplies are located due to TNC investment or local public-private capital, give evidence that the classical RCA indicator allows to measure visible comparative advantages in the trade in goods rather than revealed ones. It is proposed that analyses of advantages at country level should include the indicator of high tech goods supplies, to provide for a more accurate description of the innovation component in advanced industries. A new approach to the assessment of comparative advantages of high tech pharmaceutical manufacturing is proposed and tested, which is based on the principle of specialization and use of the ratio of Comparative Advantage in Value Added Activity (CAVA) in particular. It is revealed that the pharmaceutical industry of Ireland, Jordan, Singapore, India or Columbia, with reliance on foreign investment and technologies, could gain advantages in value added creation and dominate the national economies. It is shown that Ukraine is enhancing the advantages in value added creation in the pharmaceutical industry; is it substantiated that due to low R&D and innovation performance and heavy dependence on imported components, capacity building of this industry and its current advantages result from global tendencies and global market conjunctures rather than from the implementation of the national science & technology priorities. According to the author’s recommendation, the proposed approach to determining comparative advantages in value added creation should be used for the assessment of other high tech industries, apart from the pharmaceutical industry, and that is should be supplemented by statistical tools for analysis of foreign trade in finished and intermediate high tech goods.


2021 ◽  
Vol 12 ◽  
Author(s):  
Xiao-Bing Zhang ◽  
Tran Phuong Duc ◽  
Eugene Burgos Mutuc ◽  
Fu-Sheng Tsai

This study investigates the impacts of intellectual capital through Value-Added Intellectual Capital (VAIC) and its components: human capital efficiency (HCE) and structural capital efficiency (SCE) on financial performance in terms of return on assets (ROA) and return on equity (ROE). In addition, this study compares the effects between firms from financial and pharmaceutical industries. A total of 149 Vietnamese firms comprising of 108 financial firms and 41 pharmaceutical firms were examined. Based on the findings, VAIC and HCE show beneficial impacts on both financial performance measures, ROA, and ROE. However, SCE shows adverse and beneficial implications on ROA and ROE, respectively. In terms of industry comparison, VAIC has positive effects on ROA and ROE among the firms from financial industry, whereas it has no effect in the firms from pharmaceutical industry. The effect of HCE on ROA is stronger in the firms from financial industry than firms from pharmaceutical industry while the effect of HCE on ROE is stronger in the firms from pharmaceutical industry than firms from financial industry. The effect of SCE on ROA is stronger in the pharmaceutical firms than financial firms while the effect of SCE on ROE is stronger in the financial firms than pharmaceutical firms. Lastly, the implications of the importance of knowledge-based resources on value creation were elaborated.


2021 ◽  
Vol 24 (2) ◽  
pp. 103-118
Author(s):  
Benedek Nagy

To meet the requirements of global competition, the European Union (EU) places particular emphasis on the development of knowledge‑intensive, innovative industries. The pharmaceutical industry, as a high‑tech manufacturing subsection, has a long tradition in Europe. However, the distribution of pharmaceutical industry employment and value added is not even within the Union, and its temporal dynamics is also different. In the present paper, I examine the change of the structure of the pharmaceutical industry within the Union using country groups. I compare the development of pharmaceutical industry employment in the period between 2000 and 2018 in three country groups. I use a simple decomposition method to separate the effects of sector growth and labor productivity change on the change of pharmaceutical employment to find out how similarly this industry evolved in the different country groups. The analysis shows that while in the 12 original, i.e., pre–2004, member states (Core EU), employment slightly increased alongside a considerable increase in value added, the nine post‑socialist countries (PS9) achieved slightly greater value added expansion combined with substantial employment growth. Meanwhile, the four Visegrád countries (V4) achieved a value added growth similar to the PS9, but an even greater employment growth. This indicates that the part of the pharmaceutical industry operating with higher labor productivity is concentrating in the Core EU countries, while in the less developed post‑socialist countries, the part of the pharmaceutical industry with lower labor productivity is developing.


2020 ◽  
Vol 88 (1) ◽  
pp. 35-41 ◽  
Author(s):  
D. О. Honcharenko

The pharmaceutical industry’s R&D expenditure at the global level in 2007–2018 is analyzed. Two-thirds of the global pharmaceutical companies’ spending on R&D are accounted for by 20 multinationals companies located mostly in the U.S. and EU. With low level of R&D funding, Ukraine cannot produce cutting-edge pharmaceutical technologies. Imports of intermediate goods for pharmaceutical industry are the most widely used and most influential channel for attracting advanced technologies. The aggregation of high-tech goods by functional purpose (high-tech capital goods, high-tech intermediate and high-tech consumer goods) is analyzed. This aggregation is made by combining the Classification by Broad Economic Categories by SITC Rev. 4 (UN Statistics Division) and the High-Tech Aggregation SITC Rev. 4 (Eurostat). Based on this approach, the article identifies a range of high-tech pharmaceutical goods that are essential for pharmaceutical production, and introduces the concept of “high-tech pharmaceutical intermediate goods”. The author compiled a nomenclature of high-tech pharmaceutical intermediate goods by SITC Rev.4 (17 nomenclature positions with 6 digits). For the first time, this statistical tool made it possible to estimate the scale of national economy spending on advanced foreign technology embodied in commodities that are inputs in the pharmaceutical industry. New indicators are proposed: “ratio of import dependence of pharmaceutical production”, “‘purified’ exports of pharmaceutical goods” and “coverage ratio of imports of high-tech intermediate pharmaceutical goods”; their algorithms are given and used in the author’s calculations for Germany (strong innovator), Poland (moderate innovator), and Ukraine as a country with low level of technological innovation in the analyzed field. The author recommends using the proposed new indicators for statistical monitoring and analysis of the effectiveness of science & technology and innovation policy measures aimed at building competitive pharmaceutical industry in Ukraine, reducing its dependence on imports and enhancing its export potential.


2019 ◽  
Vol 8 (4) ◽  
pp. 139-161 ◽  
Author(s):  
Nada A Helal ◽  
Ola Elnoweam ◽  
Heba Abdullah Eassa ◽  
Ahmed M Amer ◽  
Mohamed Ashraf Eltokhy ◽  
...  

Continuous manufacturing (CM) has the potential to provide pharmaceutical products with better quality, improved yield and with reduced cost and time. Moreover, ease of scale-up, small manufacturing footprint and on-line/in-line monitoring and control of the process are other merits for CM. Regulating authorities are supporting the adoption of CM by pharmaceutical manufacturers through issuing proper guidelines. However, implementation of this technology in pharmaceutical industry is encountered by a number of challenges regarding the process development and quality assurance. This article provides a background on the implementation of CM in pharmaceutical industry, literature survey of the most recent state-of-the-art technologies and critically discussing the encountered challenges and its future prospective in pharmaceutical industry.


2021 ◽  
Vol 39 (6) ◽  
Author(s):  
Igor Matyushenko ◽  
Serhii Hlibko ◽  
Olha Prokopenko ◽  
Valeriy Ryeznikov ◽  
Olena Khanova

Research background: The article explicates the approach of assessing the factors of innovation cooperation of Ukraine and Scandinavian countries in the face of the new industrial revolution.Purpose of the article: The paper aims to assess the current state of cooperation between Ukraine and Scandinavian countries and define the most critical factors for its further development in the new industrial revolution.Methods: The article presents the research scheme of cooperation between Ukraine and Scandinavian countries based on qualitative and economic-statistical analysis, comparative advantages analysis, correlation-regression analysis.Findings & value added: As a result of the research, it was revealed that the main directions of innovation cooperation between Ukraine and Scandinavian countries are investment projects, technical assistance initiatives, experience and technologies transfer. The cooperation is mainly implemented in energy, information technologies, education, science and high-tech trade. Based on the eco-nomic-diplomatic component analysis, a forecast and the dynamics of trade turnover of Ukraine and Scandinavian countries are presented, including the critical for Ukrainian economy time-frame of 2013-2014. It has been revealed that economic diplomacy plays a vital role in establishing and expanding trade relations. To deepen the innovation cooperation between Ukraine and Scandinavian countries, the authors see the need for: (1) expanding spheres of cooperation through joint projects in infrastructure, energy, aerospace and pharmaceutical industries, and the production of components for automobiles; (2) conducting joint research on biotechnology and nanotechnology; (3) signing of agreements in order to establish partnerships between the universities of Scandinavian countries and Ukraine; (4) the introduction of state support for the aerospace industry, the creation of scientific and production clusters in this field; (5) further development and diversification of the Ukrainian IT services market and interaction with Scandinavian countries in this field.


2016 ◽  
Vol 19 (1) ◽  
pp. 53-57 ◽  
Author(s):  
Jesmin Sultana

The present study is focused towards the analysis of different barriers and prospects of pharmaceutical industries in Bangladesh. Pharmaceutical industry is one of the most promising sectors in Bangladesh. After the promulgation of local industry friendly Drug (Control) Ordinance in 1982 the scenario of pharmaceutical industries changed considerably. Now, after fulfilling the local demand Bangladesh is exporting pharmaceutical products to over 100 countries of the world. There are still lots of space for Bangladesh to flourish in this sector. So initiatives from the stakeholders are required to ensure the remarkable growth of pharmaceutical industries in Bangladesh. In this study, the scopes of advancement and the factors that can hinder the growth of pharmaceutical business are discussed thoroughly.Bangladesh Pharmaceutical Journal 19(1): 53-57, 2016


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