Artgen Biotech at the SPIEF: The ‘Advanced Pharmaceutics of Russia’ Session

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On June 6, Artgen Biotech (MOEX: ABIO) founder Artur Isaev took part in the 'Advanced Pharmaceutics of Russia: Unique Developments, New Technologies, and Industry Leadership’ session at the XXVII St. Petersburg International Economic Forum.

The participants engaged in a discussion regarding the evolution of the Russian national pharmaceutical market over the past year. What challenges does the pharmaceutical industry face, in order to provide the population with high-tech pharmaceutical products? What measures might be employed to encourage private investors to invest in pharmaceutical company shares? Which biotechnologies are likely to become the development drivers in the modern pharmaceutical industry in the near future? How can IT technologies and artificial intelligence be effectively used to develop new drugs? What incentives exist for the development of the scientific and technological capabilities of pharmaceutical companies?

Ekaterina Priezzheva, Deputy Minister of Industry and Trade of the Russian Federation, emphasized that new developments entail significant risks and substantial investments. ‘Therefore, the creation of original products is not the responsibility of a single company, but rather a collective endeavor within the industry as a whole. We are discussing the provision of technologies, the creation of an environment conducive to research, and the establishment of production facilities capable of manufacturing not just one, but an entire range of cutting-edge drugs,’ Ekaterina Priezheva stated. ‘Given the length of the development, research, and registration process, we need to come up with a ‘streamlined pathway’ to bring these innovative products to market promptly,’ emphasized the Deputy Minister of Industry and Trade of the Russian Federation. ‘When developing new innovative drugs, manufacturers should be sure that these drugs are introduced into medical use as soon as possible.’

In discussing measures to encourage private investment in pharmaceutical company shares, Artur Isaev highlighted the primary challenge facing biotech companies in securing investment. ‘The most crucial point is that institutional investors frequently lack the long-term capital required to invest in shares. It would be beneficial to establish guidelines or standards for long-term investments in the pharmaceutical market. On the other hand, the risks are significant and challenging to navigate. Therefore, we need sectoral indices and related index trackers to mitigate these risks for pension and insurance funds, as well as other institutional and private investors.’

Artur Isaev also emphasized the importance of developing contract-based production facilities, particularly for biomedicals, and of streamlining the requirements for these production facilities at the pre-marketing authorization stage and for small-scale production. ‘There is currently no contract-based production facility for biomedicals for gene therapy, antibodies, or protein drugs in Russia. This leaves small biotech companies with no viable option for drug production. They are forced to create their own production facilities, which is an unattractive proposition for investors at the early stages of development. However, the requirements for production are the same as for manufacturers of multi-million dollar drugs. We need to reduce this threshold, otherwise the cost of creating and maintaining in-house production can be dozens of times higher than the cost of developing the drug itself.’

According to Artur Isaev, Russia has an incredibly complicated and poorly functioning stage from the marketing authorization process to the introduction of new products, the so-called market access. ‘The process is frequently unregulated, and there is no priority for Russian developers. Many specialists create clinical guidelines, focusing exclusively on Western guidelines, and do not reference domestic publications or developments. These difficulties are a result of the fact that, for the past 30 years, first-in-class drugs have been entering the Russian pharmaceutical market exclusively from abroad. In these countries, the drugs have already been included in clinical guidelines and healthcare practice. Western pharmaceutical companies bring with them publications, a clear understanding of the drug’s place in treatment, and drugs included in insurance medicine and training programs for doctors. Now, it is our responsibility, in collaboration with regulators, to learn how to do this effectively for Russian drugs.’

In addition to the challenges Russian biopharmaceutical companies and developers of first-in-class innovative drugs are currently facing, Artur Isaev also highlighted the lack of access to international markets. ‘It is a myth that registering a drug in Russia will automatically result in global market domination, regardless of its quality. Because once a drug has been registered in Russia, if you want to enter another market, you will have to repeat the entire process according to local requirements, from clinical trials to certification and production licensing. It is therefore crucial to harmonize legislation in the field of drug distribution. That said, there is an excellent case study that demonstrates the feasibility of solving this issue: Sputnik. Despite the lack of harmonization, Sputnik could be sold in many countries.’

The session concluded with a consensus among all participants that, to facilitate further development, pharmaceutical companies require systemic support measures throughout the life cycle of innovative drug development and production, as well as tools for launching products both in both the Russian and international markets.

The St. Petersburg International Economic Forum is one of the world’s largest and most significant business events. The SPIEF-2023 welcomed over 17,000 participants from 130 countries. More than 900 agreements were concluded on the Forum’s platform, representing a combined value of RUB 3.86 trillion.