Indian Pharma Companies Fill Void in Russia as West Retreats; Industry Expert Senses 'Big Opportunity'

For the past two years, Indian pharmaceutical companies have increased their presence in Russia as Western competitors withdraw from the market amid dozens of sanctions against Moscow. India has already replaced Germany to become Russia’s foremost supplier of pharmaceuticals last year, according to Russian media reports.

This surge in Indian exports, marking a 3 percent rise from the previous year, saw nearly 294 million packages of medicines delivered to Russia, the Russia Today (RT) reported. The shift in supply dynamics saw India surpass Germany, which was the top supplier in 2021 and 2022 but reduced its exports by almost 20 percent to 238.7 million packages last year.

‘The world’s pharmacy’

The backdrop for this shift stems from many Western pharmaceutical firms suspending non-essential operations and investments in Russia due to the ongoing Ukraine conflict. Major international players such as Eli Lilly, Bayer, Pfizer, MSD, and Novartis have also paused new clinical trials in the country.

As the West withdraws, Indian pharmaceutical entities are exploring business expansion avenues in Russia, including joint production ventures. India boasts the world’s third-largest pharmaceutical industry by volume, earning it the moniker “the world’s pharmacy” and positioning it as a significant player in the global pharmaceutical trade. In an interview with RT, Satya Karm Punia, the president of Moscow-based Rus Biopharm Group, spoke about the benefits of this growing trade in the pharma sector between the long-standing partners.

‘Price benefit’

“Because of the relationship that [India and Russia share], I am sure the Indian pharmaceutical companies have a good role to play in Russia,” said the Indian businessman, whose group’s manufacturing facility is located in the special economic zone near Moscow. He underlined that in the past two years, India has started supplying Russia with a host of the raw materials used to manufacture medicines, effectively replacing the Western suppliers that previously had a strong presence in the market.

Punia argued that Russia would derive a “price benefit” for its domestically produced medicines if it sourced more raw materials from India. “The medicines would get cheaper, which means [it would be] more accessible for the regular people; that is a huge benefit.” Punia told RT that India’s increasing forays into the Russian market will be a “big opportunity” for the country. He stated that around 15-20 Indian pharmaceutical companies are already working in Russia.