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Growth slows on Russia's pharmaceutical market
Russia's pharmaceutical market is set to grow 10-15 percent in 2008 and this is just a small advance compared to previous years, when the growth rate exceeded 30 percent. Government funds have dried up in the market, and market participants have turned towards the commercial sector, which expanded 22 percent in 2007, the highest rate since 1998.
Experts elaborated that strong growth in the commercial sector could be traced to improved public welfare, which will remain the key driver for the pharmaceutical market in future. Expectations are that the market will be gaining 15-18 percent annually for some 3 to 5 years to come.
According to experts, Russian pharmaceutical producers have been growing less competitive as small and medium sized companies have found it increasingly hard to rival with large transnational corporations. Mergers and acquisitions are most frequent among producers, however, pharmaceutical retail chains have also been involved in the process, and more mergers are yet to be announced in this sector.
In addition, foreign companies are expected to tap into the Russian market soon. Industry observers predict that by 2010, non-residents will control up to 80 percent of the retail market.