— Government pricing policy “a disaster” —
Exports of the pharmaceuticals giant Remedica are expected to rise by 12% from last year to EUR 45 mln in 2010, as new drugs become available in the European market where older patents expire and pave the way for new entrants.
Emilios Savvides, Managing Director of the company regarded as one of the industrial success stories of Cyprus and among the island’s biggest exporters, said that Remedica’s development is being held back by the government’s pricing policy that has “punished us because we offer lower prices.”
He explained that a Ministerial decree slaps a fixed price on drugs that cost less than 5 euros, but allows price increases on the more expensive medicines.
“The exact opposite should have happened to allow increases on cheaper drugs and fix prices on the more expensive medicines,” Savvides said, adding that Remedica even offered free medicines to the Cyprus government, as long as it would be allowed to raise its prices for the lucrative exports market. The offer was rejected.
“If the government does not withdraw the Ministerial order then we will be obliged to take the drugs off the market and the patients will have to resort to much more expensive medicine which the government will have to pay for. At the same time, any such withdrawal will result in a reduction of exports, loss of tax revenues for the state and possibly loss of jobs.”
Savvides said that Remedica’s unique Aremed, used for the treatment of advanced breast cancer among post-menopausal women, is already saving the taxpayer EUR 380,000, about 35% off alternative breast cancer drugs using tamoxifene. On top of all that, the company currently employs 430 people, contributes EUR 3 mln in national taxes and other contributions, provides commissions worth EUR 5 mln to associates and resellers and exports the ‘Made in Cyprus’ brand to more than 100 countries.
Aremed and other exports were delayed because of an extension that international competitors won on the expiry of their patents. Otherwise, Remedica’s sales could even have reached EUR 50 mln this year.
“But we have the capacity to overtake that amount and go much higher over the next few years,” Savvides said, adding that the company will seek the strict FDA approval for one of its new anti-cancer drug producing plants so that some products may be exported to North America as well. Already, Aremed is pending a license to be marketed in Canada, where it underwent extensive clinical trials in its development phase.
The company’s injection into the local economy also includes investments of EUR 15 mln in new buildings and equipment for the anti cancer-producing drugs plants and upgrade of the three older plants.
“In these trying times, we have hired 30 more staff and all staff got their pay rises for 2010,” Savvides said.
Remedica continues to beat the negative market trends with lower cost products and is currently developing new medicines bringing the total number of medicinal and healthcare products to 450 at ten plants in Limassol.
It is marking its 50th anniversary this year that coincides with the Republic’s celebrations, and plans to increase its community giving programme with greater public awareness and contributions.
Remedica’s chief executive, Charalambos Pattichis, signed an agreement to support the Cyprus Multiple Sclerosis Association, despite the fact that the company does not produce any MS medication and would not have any financial benefit from this sponsorship.
“We have won six exports and quality awards and we will continue to expand our activities to new products and into new markets, in cooperation with other international companies,” Pattichis said.
The success story that started with the transformation of a 1960s chemicals company to a pharmaceutical giant in 1980 by its founder, Takis Pattichis, was not easy as the company relied on own funds to ensure its growth in a competitive market where multinationals maintained a tight grip.
“As a family business we have always re-invested a big part of our profits and as a result, our investments in recent years have increased dramatically,” Charalambos Pattichis added, proud of the fact that at present, Remedica accounts for a significant share of the Cyprus pharmaceutical industry, estimated to be worth more than EUR 150 mln.
