BRIEF OVERVIEW OF ARMENIA=S PHARMACEUTICAL MARKET
Source: U.S. Embassy, Yerevan
Author: George Isayan, BISNIS Representative
Date: August 1999
Market Size and U.S. Share
The potential total market for pharmaceutical products in Armenia is estimated to be $40-50 million. In 1998, however, the annual sales turnover of pharmaceutical products was $10 million. The Armenian pharmaceutical market has a well-established countrywide distribution network. It includes 540 pharmacies licensed by the Armenian Ministry of Health, with nearly 90% of these in private hands. Although the U.S. share of pharmaceutical imports is relatively small, it is growing and is represented by such brand-name producers as Johnson & Johnson, Merck, and Bristol-Myers-Squibb.
Major Market Suppliers
Pharmaceutical wholesale distribution in Armenia is handled by 37 local private companies. Among the largest is Armfarmacia, formerly the state-owned monopoly for the importation and distribution of medicines to Armenia. Currently, the company is fully privatized and, with annual sales of almost $2 million in 1998, it holds 10-15% of the local market. Other major suppliers engaged in both wholesale and retail distribution include Eskulap, Arfa, Yerevan Drugbase, Lambron, and Shtap Ognutyun. Among the largest foreign suppliers are companies from the UK (GlaxoWellcome has a representative office), Germany (Asta Medica), Hungary (Gedeon Richter), and a number of pharmaceutical producers from Russia, Ukraine, Belarus, the Baltic States and Iran. In1998, Pharmatec, a UK-owned company, established a manufacturing facility in Yerevan, and began production of I.V. solutions and other products.
The total amount of its investment is around $20 million. Pharmatec's Yerevan facility has begun exporting to Russia and Georgia, and is planning distribution to Kazakhstan and Uzbekistan.
A significant volume of pharmaceutical products comes to Armenia through humanitarian assistance channels, mainly from the United States and the EU, with free distribution to patients.
Major End-Users
Major end-users of both humanitarian assistance and pharmaceutical products supplied through commercial channels are public hospitals, private pharmacies, and local, private, small and medium sized clinics. The state reimburses patients the cost of several prescription medicines such as narcotics, antidiabetics (insulin), and oncology products. For all other items, patients must pay themselves.
Best Sales Prospects
There is large demand for syringes, dressing supplies, antiseptic pads, band aids, surgical tapes, and oxygen tanks. There are also good sales prospects for narcotics and analgesics. The vitamin market is expected to grow rapidly in the near future. Armenia has the potential to build its own production facilities for pharmaceuticals and other medical products using a low cost skilled labor force, taking advantage of liberal trade legislation, and exporting possibilities of entering the regional markets of the other NIS countries.
Registration/Certification
Exports of pharmaceuticals to Armenia require registration (certification) by the Drug and Medical Technology Agency (DMTA) of Armenia. Applications for registration should be filed by the manufacturer. The process may take anywhere from a few days up to three months (some drugs may require laboratory testing). The registration is valid for 5 years. Exporters are warned that former USSR registrations were valid in Armenia until the end of 1996 only. Registration fees vary from $200 for new dosages of known drugs to $1,200 for new drugs. DMTA maintains a list of all pharmaceuticals registered in Armenia, as well as The Essential Drugs List, which can be requested from DMTA.
Key Contacts
Drug and Medical Technology Agency (DMTA)
6 Hekimyan St.
Yerevan Armenia
Tel: (374-2) 533-578, 524-780
Fax: (374-2)151-697, or 527-530
E-mail: gabri@pnas.sci.am
Contact: Dr.. Emil Gabrielyan, Director, or Mr. Vartan Tovmasyan, Head of Registration Department
Ministry of Health of Armenia
8 Tumanian Street, Yerevan - 37, Armenia
Tel: (374-2) 528-872
E-mail: tatulmoh@umcor.arminco.com
Contact: Mr. Tatul Hakobian, Head of General Department of Provision
"Deghabaza Yerevan"
20 Komitas St., Yerevan-12, Armenia
Tel: (374-2) 270-238
Fax: (374-2) 270-238
Lambron-Pharmimpex
22 Kazar Parpetsu St., Yerevan-2, Armenia
Tel: (374-2) 538-796
Fax: (374-2) 533-265
E-mail: lamb@mbox.amilink.net
http://www.absc.static.amilink.net/lambron
Arfa
21/24 Tumanian St., Yerevan-1, Armenia
Tel: (374-2) 589-838
Fax: (374-2) 589-838
Investment Opportunity
Industry: Medical Diagnostic Test Systems
Company: Delta
Delta was founded in 1992 as a private company. It specializes in the manufacturing of diagnostic test systems for clinical chemistry and the import and wholesale distribution of diagnostic kits and equipment. The imported kits are designed for Infectious Diseases, Tumor Markers, Hormones, Fertility, etc. Among Delta's clients are the largest local hospitals, clinics, and medical centers. The company's suppliers include DRG International, Syntron Bioresearch, Immunosticks, Inc., Awareness Technology (all U.S. companies), a number of firms from Israel, the Czech Republic, Germany, France, and Russia. Delta has a staff of 18 people, including highly skilled chemists and biophysicists.
Delta wishes to expand its production volume and seeks a U.S. joint venture partner to set up the joint production of diagnostic reagents in Armenia. The American company is expected to supply packaging
equipment and provide bulk products and accessories. The products can be marketed in neighboring Georgia and other NIS countries. Additional marketing assistance will be appreciated. Delta can conduct business in English.
CONTACT: Dr. Anna Arzoumanian, Manager (Speaks English)
7 Hasratian St., Yerevan - 14, Armenia
Tel: (374-2) 232-145
Fax: (374-2) 151-331
E-mail: root@delta.arminco.com