Experts Discuss the Potential for Venture Investments in the Pharmaceutical Market in Russia


On July 3, RVC has conducted the business breakfast “Pharmaceutical and Medical Industry in Russia: Potential for Venture Investments”. The meeting was devoted to presentation of the key parameters of the new venture fund in the pharmaceutical and medical industry established by RVC and the Russian Ministry of Industry and Trade. The invited experts also discussed the tools to support startups in manufacturing of pharmaceuticals, medical products and specialized software.

When opening the business breakfast, CEO of RVC Alexander Povalko noted that one of the key topics under discussion is the prospects for operation of the venture fund to be established by RVC jointly with the Russian Ministry of Industry and Trade.

“The total size of the Foundation will amount to RUB 4.5 billion. The Foundation is to become a professional tool for investments and development of companies specializing in the creation of new pharmaceuticals, medical products and software intended for medical purposes.”

According to Mr. Sergey Tsyb, First Deputy Ministry of Industry and Trade of the Russian Federation, both an upgrade of the industry and a large-scale development of new pharmaceuticals and their clinical trials were required at times when Pharma 2020 national program was created.

“We are grateful to RVC for having supported our initiative and having proposed a solution to implement it. It is important for us that the venture foundation being established will support the most cutting-edge technologies in pharmaceutical and medical industry, which are capable of bringing the industry to the whole new development level.”

Representatives of major biopharmaceutical companies shared their vision of how their businesses in Russia will develop in the future and what role the fund created will play in implementation of their plans.

“Our priority today is to continue developing the Russian business unit while considering the fact that production facilities have already been localized. Russia has a major advantage over many other countries: its scientific and human capital. Over the last years, we have found 10 promising startups, from medicinal molecules and diagnostic solutions up to portable medical devices. We are interested in development of these projects, in having production facilities in Russia, and in exporting their products to global markets”, noted Irina Panarina, CEO for Russia and Eurasia at Astra Zeneca.

“Our company is anticipating that it becomes a global leader in AI in healthcare. We have joined forces with Microsoft and Intel to create the Edisson platform. It is a cloud-based infrastructure that enables companies of any size — startups, private companies and university teams — to create their apps for medical purposes. We are very much interested in having Russian developments of such kind in Russia,” believes Nina Kandelaki, CEO for Russia and CIS, GE Healthcare.

Kirill Litovchenko, CEO of Ferring Pharmaceuticals, believes that the Foundation will help address the demographical issue that is very critical for Russia.

“We need to establish a reproductive data collection and analysis system in order to create the single register of infertile patients and manage them from the diagnosis and commencement of treatment to the time when a healthy child is born. Later on, this system may be supplemented with the option of adding genetic information that would enable to create and process a huge data array to study the reproductive health of the nation and developments in the Russian Federation. Such objective is quite suitable for the companies that will support the venture fund being created.”

“The prospects for the pharmaceutical venture foundation look very good”, noted in his speech Andrey Ivashchenko, Chairman of Management Board at Khimrar. In his opinion, fast-track (accelerated passage and registration) highly specialized drugs should be invented in order to double or triple its success, then the Foundation’s liquidity position will improve by several times.

At the end of the business breakfast, Mr. Alexey Basov, Deputy CEO and Investment Director at RVC, held a detailed presentation of the venture foundation for all discussion participants.

“We expect much more than just high IRR from the foundation. We hope to create a critical mass of products that will give the momentum to our market for medical products, pharmaceuticals and will display the applicability of this tool, the possibilities of its scaling up, in order to encourage changes occurring due to introduction of new technologies, digitalization of processes, creation of new sales channels and new types of roles in the market that is getting increasingly complicated.”

On July 3, 2019, a procedure to select a managing partner for the venture foundation in pharmaceutical and medical industry has been launched. Management companies are invited to apply for participation in the selection procedure at the latest on August 16, 2019. The winner will be determined by the Board of Directors of RVC before the end of 2019.

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