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Merck & Co. Ups Russian Contract to Appease Pharma 2020

By Dan Stanton , 20-Aug-2013
Last updated on 20-Aug-2013 at 12:51 GMT

MSD uses local CMO to sell drugs in Russia's protectionist market
MSD uses local CMO to sell drugs in Russia's protectionist market

MSD has extended its branded drug manufacturing partnership with Akrikhin in order to fulfill Pharma 2020 - Russia’s local manufacturing strategy.

In July 2012 Akrikhin, the Russian Contract Manufacturing Organisation (CMO), signed an agreement with MSD (known as Merck & Co. in North America) to manufacture six  branded drugs from its facilities 20km outside of Moscow. This extension will see a further five finished formulations being made for sale in the local economy.

Steffen Brygger Lund, VP and Managing Director of MSD in Russia told Outsourcing-Pharma.com “MSD is committed to helping the Government of Russia achieve its health care and industrial targets.

“The government had made it very clear that it would like to see more innovative products manufactured in Russia as part of the transformation of the Russian pharmaceutical industry into a global, export oriented, and innovative industry.”

Russia’s Pharma 2020 strategy is a series of measures first proposed by then President Vladimir Putin in 2009, in order to revolutionise the local pharmaceutical industry. The policy intends for 70% of drug manufacturing to be done on Russian soil by 2020 with all facilities complying to international Good Manufacturing Practice (GMP) by 2014.

In order to achieve these targets, Big Pharma has gone down a number of different routes including building its own facilities in Russia – as Novartis did in 2011 with a $500m (€373m) plant in St Petersburg – or by creating joint ventures. GlaxoSmithKline, for example, formed a partnership with Moscow-based vaccine firm Binnopharm in 2011.

Instead MSD has chosen the outsourcing route in order to get its products into a market estimated by the Russian Government to be worth $35bn by 2020 , and thus demonstrates the opportunities available for local CMOs like Akrikhin in teaming up with foreign drugmakers.

Extended Output

Under the terms of the extended contract, Akrikhin will manufacture a range of MSD drugs for Type 2 diabetes, bronchial asthma, invasive mycoses and hypolipidemic drugs.

“These products will be packed at the Akrikhin facility,” MSD Russia spokesperson, Dr. Yoav Shechter, told us adding “formulation transfer will start to occur as soon as Akrikhin’s new formulation facility is qualified and operational.”

According to Akrikhin the production facility is part of a programme of modernization and increased volume which has seen over $28m invested into its site since 2010, with all its plants expected to be GMP compliant before the Government's deadline.

“The company uses its accumulated potential to fulfil MSD’s high standard of quality,” continued Shechter. “This potential encompasses both the personnel’s competency in contract manufacturing and the state-of-art facilities, which are continuously upgraded to adhere to the company’s own investment program.”

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