"Whoever invests in Moldova is a great optimist". Interview with Vasile Cazacu, director of Balkan Pharmaceuticals
Your company has been present on the Moldovan market for more than 15 years. How has the pharmaceutical market and the pharmaceutical market in general changed during this period?
Time does not stand still, neither does the pharmaceutical market. Among the most important changes during this period is the introduction of new international standards for manufacturers. In the manufacture of pharmaceutical products, certain requirements have been imposed to ensure that quality products are consistently manufactured and that this quality must be unchanged from batch to batch. These include rules for both the procurement of raw materials and the manufacture of packaging, as well as requirements for space, water and air. For Moldova, this was a very important change. At the time of the introduction of the amendments, there were 24 drug manufacturers in our country, then there were four, and along the way their number increased to seven. Many could not withstand the competition, their products were not profitable enough to cope with the new conditions.
What action did you have to take in relation to these standards?
Six years ago we built a new production unit, which was already under construction according to the requirements, we brought not only our own specialists, but also foreign ones, therefore the steps were quite serious, and the investments were substantial.
How much have the owners invested in the development of the plant and the production of medicine over the years?
More than 40 million euros have been invested in this business since we started.
Are you not afraid of these investments in the context of a difficult geopolitical and economic situation?
I don't think what's happening is going to be a challenge for our company that we can't overcome. It is difficult, but not more than that. And there are always risks.
What economic difficulties did you face and what did they entail?
Fortunately, there were no such difficult times. Sometimes we were worried about political changes because they were related to the question of the feasibility of an investment. I hope this is a thing of the past.
Ukrainian crisis and prices
Part of the raw materials for the production of medicines you supply them from Ukraine. Have the supply conditions and cost of raw materials changed since February 24th?
Yes, there are problems with this situation. One of the most important is the logistics field. The shipping price has increased and the delivery time has also increased. If you round up, the price and delivery time almost tripled.
So will drug prices go up too?
Inevitabilly, yes. Everything is getting more expensive, especially energy, and the drug production process is energy intensive. For this reason, increasing the cost of drugs will be the next step in this chain.
Is there a risk of shortage of certain medicines?
I can't speak for everyone in the pharmaceutical market, but for me I would say that this business is quite flexible. I don't think there will be any significant disruption to drug supply and production. Changes are possible, but not critical.
In your interviews, you often talk about plans to enter the markets of Ukraine, Europe and Africa. Do you continue to work in this direction? Are there any concerns?
Export volume to various markets continues to grow, including Africa, Asia and Europe. We are trying to move forward. You know, whoever invests in Moldova is a great optimist, so we can only hope for success in this area of our production as well.
Does the state support you as a local producer?
The system of privileges for the local producer has not existed for a long time. We would like to return to it. In most neighboring countries, the share of local pharmaceutical manufacturers is between 30% and 40%. Moldova, on the other hand, continues to be very dependent on imports in this field. Our main desire is for there to be a level playing field for everyone.
What do you mean by level playing field? Now aren't they equal for everyone?
Currently, there are some shortcomings in the legislative field, which should already be updated. For example, pricing, which depends on a Government Decision that is over 10 years old. We know that this issue is under review, but we would like to speed up the process.
New drugs and Covid-19
Are the active substances for the production of medicines imported or do you produce them in your laboratories?
We import almost all active substances, about 99%. The main suppliers of raw materials for the production of drugs are India and China. The products of our suppliers are also used by large corporations and have European registration.
Are there any plans to launch a drug that is not yet in your production?
Now we are working on biosimilars. We use genetic engineering to produce them. We are in the process of transferring technology from Italy.
Can you tell me more about these drugs, what makes them special?
When an original drug is no longer protected by patent, other pharmaceutical companies obtain the right to use the same active ingredient in their drugs. Through biotechnology, we are trying to reproduce analogs of these drugs. Thus, we cannot produce an identical counterpart of the drug, but a similar one, whose molecule will be similar to the original one in terms of structure, properties, biological activity, etc. The process of producing such drugs is very complex and meticulous, because the reactions within a protein molecule are difficult to predict.
What do you think about the drugs used for Covid-19? Many of them have not been fully studied and their effects are not proven, but due to urgency and necessity they have already been launched on the market.
The release of these drugs was triggered by the complexity and danger of the situation. It was a necessary measure. There were mistakes and there were successes. However, there is now a treatment protocol that has worked quite well. Scientific research is ongoing, even after the drug has been released, so we just have to wait.
Have you launched any new drugs during this period?
We started to produce a new medicine. New to us, but not to the pharmaceutical market – hydroxychloroquine. It is an anti-inflammatory drug that was widely used in the early stages to treat Covid-19. It has not only anti-inflammatory properties, but also antimalarial and immunosuppressive properties (that is, it suppresses the body's immune response, which is necessary in the treatment of various autoimmune diseases, in antitumor therapy and, just as importantly, in transplantology). The range of anti-coagulation drugs was also expanded, as this virus was often complicated by the formation of blood clots.