According to new market analysis by Russia Profile, Nycomed’s Russian operations generated $243m (€171m) last year, almost ten per cent of its total revenues for 2008 and up from just $26m a decade ago.
The report suggests that the new plant will be used to make both finished drug formulations and, uniquely for a foreign drugmaker in Russia, active pharmaceutical ingredients (API).
It goes on to reveal that Nycomed has been looking at potential sites for the new facility for the past two years and is expected to make a final decision sometime in Q4 this year.
The authors cite predications that Russia’s drug market will be worth $20bn a year by 2013 as part of the attraction for Nycomed. This idea was reiterated by Jostein Davidsen, Nycomed’s general manager in the country.
He said that: “If we look at the current plans for Nycomed Group, the Russia-CIS region will represent 38 per cent of the total growth of Nycomed in 2013, on sales reaching €900m.”
Davidsen also believes that access to the market will be vital for success in Russia given the Ministry of Industry and Trade’s 2008 pledge to only purchase drugs from overseas if they are provided at a 15 per cent discount to locally made products.
In other Nycomed news, Reuters reports that the firm is in a bidding war with an unnamed Japanese group to acquire the pharma unit of Belgian drug and chemicals firm Solvay.
Although details are still unclear at this stage, analysts suggest that the business could be worth as much as $7bn. The report goes on to suggest that Nycomed may achieve significant cost saving and synergies through an acquisition.
Solvay has declined to comment on any potential deal.