He says that in such an environment it is extremely difficult to grow and even make plans. “If there is a stringent medical need that is not satisfied, the market will grow because people will request medical care,” Lirette told Ziarul Financiar in an interview.
The 49-year old GSK executive is in charge of twelve markets in Europe (Estonia, Latvia, Lithuania, Poland, Czech Republic, Slovakia, Slovenia, Hungary, Romania, Bulgaria, Cyprus, Malta and Gibraltar) and sees significant long-term growth prospects in Romania.
GSK is among the top five pharmaceutical companies in Romania, with a 6% market share and sales of 591 million lei (EUR136.3 million) from July 2010 through June 2011, according to data provided by market research company Cegedim Romania.
On the other hand, about 13% to 14% of its Central and Eastern European sales are generated by Romania and Lirette says this country is an “important contributor” to the growth in the region.
“Romania is the second largest country in Central Europe after Poland and seventh in the European Union. It is a country where we want to continue to invest and where we can see long-term opportunities,” Lirette added.
According to information available at the end of May, GSK had RON21 million (almost EUR5 million) budgeted for investments in its Europharm plant in Brasov for this year. One of the projects requiring investment is a lab that will be completed in 2012. The company exports drugs made in Brasov to 50 countries throughout the world.
Europharm was the largest pharmaceutical producer by sales last year, which stood at over EUR90 million in 2010, according to ZF calculations. GSK bought Europharm from local businessman Mihai Miron in the early 2000’s.
The plant output went up 57% in volume year-on-year in 2010 and reached 42.3 million units. Exports accounted for 43% of the total output.
Lirette says the plant in Brasov has evolved from making mostly generic drugs for the local market into one that exports GSK products to 50 countries and also makes innovative drugs; it also began production of drugs used in treating HIV and central nervous system conditions a little while ago.
GSK’s official added that with the current price setting mechanism, which is different from country to country, the legislation in place in Romania does not encourage pharmaceutical companies to produce drugs ihere and then export them at a competitive price.
Prescription drug prices in Romania are calculated as decided by the authorities using a complex mechanism, which compares prices in other countries and takes into account the minimum value found. The price is not regulated in case of over-the-counter (non-prescription) drugs.
Paul Lirette believes the Central and Eastern European market has the potential to become the biggest in Europe in terms of growth.
The pharmaceutical market amounts to over EUR2 billion a year in Romania and the top competitors are Sanofi-Aventis, Roche, Novartis, Pfizer, GSK and others.
(English version by Loredana Fratila-Cristescu)