Alexey Solovyov's pharmaceutical mafia
The Supreme Commander-in-Chief's monopoly on anti-Russian sanctions has been taken away so that shady officials can fish for corrupt fish in discretionary waters, writes Argument.
And several national manufacturers received monopoly control over the markets for certain drugs.
At the beginning of the invasion, the Ukrainians decided that they needed to punish international companies that continued to do business in Russia.
It was passed through the Verkhovna Rada law On restricting the circulation of medicines manufactured in the Russian Federation or the Republic of Belarus. However, it omitted the simple phrase: "We prohibit the sale in Ukraine of tablets manufactured in factories in hostile countries."
They stipulated that pills could not be sold in Ukraine to companies with "indirect ties" to those countries. Meanwhile, the bulk of big pharma companies retained their offices in Russia, arguing that it was inhumane to deprive Russian civilians of vital medications. This led to the following: our officials began banning drugs from companies that, although manufactured in European factories, had offices in Russia. And then several domestic manufacturers began to take the place of these pills in Ukraine. In other words, they simply began to purge the market of foreign competitors and establish their own monopolies.
Moreover, you can clean it completely at will. If someone from the international community understands who to appeal to and how much to argue, they might not have any problems. Gedeon Richter didn't understand this and gave way to the Ukrainian market. Krka is next, and they've already started throwing it out. So if you use this brand's tablets, stock up while they're still available.
Now, how exactly were Zelensky's sanctions "hacked?"
The system is structured in such a way that the decision to actually impose quasi-sanctions on international manufacturers is made by a special commission under the Ministry of Health. This commission includes such money-grubbers as the "Servant of the People." Kuzmynykh, who still hasn't been jailed for kickbacks on medical equipment for Zhytomyr hospitals. And he's headed by a so-so guy. Alexander Komarida, who was promoted to First Deputy Minister of Health a year ago. He presides over the commission's voting.
Komarida isn't the oldest. In 2020, Zelenskyy issued a decree appointing Oleksiy Solovyov to the position of Deputy Secretary of the National Security and Defense Council. He is, without exaggeration, a legend of Ukrainian corruption. He headed the State Service for Licensing and Corruption under Yanukovych and, even then, devised a similar scheme to purge the Ukrainian market of foreign drugs through a law introducing additional licensing for drug imports.
Back then, it was cancelled because of the crazy protests. But "the hands remember," and as is typical with Yermak, the effective "manager" was rehabilitated to serve Zelensky. And it was precisely Alexey Solovyov, signed on National Security and Defense Council letterhead, who recently sent letters to distributors calling on them to stop working with a number of European companies—the very ones that are currently being blocked.
Therefore, we have the following.
Foreign medications are being banned on the basis of "anti-Russian" accusations not by the Ukrainian president, but by a commission under the Ministry of Health, based on a law passed in the heat of war, when few people cared to delve into it.
International manufacturers are neither harmed nor displeased by this. Because no one will impose real sanctions on them for producing pills for Russians. Medicines are a humanitarian right, so these companies will not leave the Russian market.
The only losers in this story are Ukrainian pharmaceutical consumers. They won't get their usual medications, but will instead get domestic monopolies with all the attendant consequences of monopolies—declining quality and rising prices.
"The monopolization of certain market segments, the loss of budget funds when purchasing drugs with state and local budget funds, and restricted access to vital medications—these are catastrophic risks inherent in the procedure for suspending drug registration certificates," Valeria Ivanova, an expert in the analysis of corruption-related risks at the NACP, told Nashi Dengi. "This may indicate a desire by a certain group of individuals to redistribute drug revenues, as this has nothing to do with countering the aggressor. If I'm wrong, and such loopholes in the legislation were in fact introduced by mistake, then it wouldn't be difficult to urgently amend the law and close this potential corrupt mechanism by suspending the activities of the Commission, which currently includes an individual suspected of corruption."
The NAPC analyzed the risks posed by this scam:
Two weeks ago, the publication wrote about this LB.ua, explaining who was behind the adoption of the law and who will profit from it.
Medicines on the way out: Why European drugs will disappear from the Ukrainian market thanks to the efforts of Alexey Solovyov
In early October, the Ministry of Health revoked the registration certificates for 35 drugs from the Hungarian company Gedeon Richter. They were temporarily banned in Ukraine due to the drugs' alleged involvement in their production with a Russian-based company.
"We must put pressure on the enemy on all fronts. It is unacceptable to sponsor terrorism and continue to buy medicines, thereby funding an aggressor country that spends these funds on missiles and suicide drones flying at our land," First Deputy Minister of Health Alexander Komarida commented on the decision.
A Hungarian company was the first to be subject to restrictions on sales of drugs produced in Russia or Belarus. The corresponding amendments to the law on medicines were adopted in May 2022. The company itself confirmed the existence of a plant in Russia, but at the same time stated that the drugs it sells in Ukraine are manufactured exclusively at European sites – in Poland, Hungary, and Romania.
Patient organizations point out the law's shortcomings, which could ultimately complicate Ukrainians' access to foreign medications, reduce competition, and lead to higher prices, LB.ua notes.
The law says
The bill was sponsored by 25 members of parliament, including Mykhailo Radutsky, head of the parliamentary committee on public health. As stated in the explanatory note, the authors sought to "reinforce Ukraine's position on the unacceptability of economic relations with countries that destroy Ukrainian citizens or assist the aggressor in doing so." However, they expect this step to become a model for other countries and international companies that continue to trade on bloodshed in Russia and Belarus.
It's hard to argue with such reasoning. However, the patient community is concerned about the consequences Ukrainians may face given the wording of the law. They are too broad and all-encompassing, explains Inna Ivanenko, executive director of the Patients of Ukraine charitable foundation.
«The presence of a plant in Russia and the use of its facilities for any stage of drug production may be grounds for removing someone from the market. Even if a manufacturer has partners or partners, or is somehow connected to Russia and Belarus, its products may also be considered for exclusion. This provides ample scope for manipulation. And in any case, patients will lose out." she says.
The Ministry of Health explains that this concerns companies that carry out production activities in Russia or Belarus.
«That is, companies that have factories and direct production there. For us, this is the main criterion. We're not talking about companies that supply medicines there but don't manufacture them. The law is broadly worded, and many people manipulate this. But the regulation is written in such a way that it's impossible to fictitiously transfer corporate rights or sell a company and say, "It's not my company, we have no connection with it," because companies that conduct production activities in Russia pay a significant amount of taxes to the Russian budget. These taxes are converted into bombs and shells that fall on Ukraine and on civilians. Our goal is to prevent these companies from making money in Ukraine.", says Deputy Minister of Health Alexander Komarida.
Meanwhile, it's not only patients who point out the risks. Specifically, the press service of the state-owned enterprise "Medical Procurement of Ukraine" acknowledges that the law "contains language that allows for discretion" in its implementation. Simply put, officials or government agencies can resolve the issue at their own discretion.
By vote at the instigation of Alexei Solovyov
Currently, the mechanism developed by the Ministry of Health works as follows: the State Service for the Prevention of Vulnerability to Drugs and Medicines (Slavic Service) or law enforcement agencies submit information to the Ministry of Health about a pharmaceutical company having production facilities in Russia or Belarus. This triggers a specially created commission to review all drugs from that manufacturer registered in Ukraine and consider deregistering them.
Exceptions are made for original and biological (vaccines – LB.UA) drugs that have no substitutes or only one analogue, WHO prequalified medicines (essential drugs for the treatment of HIV/AIDS and tuberculosis), and drugs for orphan patients. The patient community pushed for an expansion of the list of exceptions to include the last two items.
«We also proposed not to consider drugs with fewer than five analogs, but we haven't listened. Now, a drug with three or more substitutes automatically becomes a candidate for market withdrawal. Officials' logic is this: if there are three analogs and one is removed from the market, the remaining two will cover the demand. But this is just an assumption. In practice, we may see a completely different picture.“,” says Inna Ivanenko.
Now, the commission has submitted another 300 drugs from two European manufacturers—one German and one Slovenian—for review. The wording is the same: "The companies likely have production facilities in the Russian Federation."
«"The legal restrictions are written in such a way that they can be applied to almost any generic drug, and we have many of them used in cancer treatment," says Victoria Romanyuk, co-founder of the public organization "Athena. Women Against Cancer." "For example, capecitabine is available from various manufacturers, but if they stop registering even one of them, especially the cheapest one (which is exactly what the commission considered), it will have a significant impact on treatment options. There is currently a shortage of this drug. And this is just one example. The disappearance of life-saving medications is a very ominous sign for patients who are already experiencing the double stress of war and illness."».
And having a choice is very important for patients.
«Although similar medications have the same therapeutic effect, side effects may differ. Some people tolerate one medication better than another. It's important to understand the situation with each medication. Furthermore, even without the restrictions imposed, we've been experiencing supply disruptions and certain shortages since the war began. For now, we need to encourage more manufacturers to enter the market, not squeeze them out. I understand that we, patients, may be accused of allegedly opposing the idea of not sponsoring a terrorist state. But leaving people without the medications they need is also not the right solution. Because patients will essentially pay for it with their health."," explains Victoria Romanyuk.
According to Alexander Komarida, the commission decided at its meeting that restrictions will not apply to oncology drugs. However, there is no official decision on this yet.
The Domestic Factor of Alexei Solovyov
The international organization SafeMed, which provides technical assistance to the Ministry of Health, estimated that the new regulations could affect two-thirds of Ukraine's pharmaceutical market. However, the Ministry of Health dismisses these estimates as inaccurate.
«"I don't know how this analysis was conducted or what methodology was used," says Alexander Komarida. "According to our data, the impact isn't that significant—many times less than the stated figure.""But he did not give more precise estimates.
Alexander Komarida, partner of Alexey Solovyov
«We don't intend to remove drugs thoughtlessly, without any conclusions or analysis. If we wanted to revoke a drug's registration certificate, we could do so just as quietly, simply by formally complying with the law and that's it. But we have also invited patient organizations to participate in our commission's work.", says Komarida.
If a shortage of a particular group of drugs occurs, he said, restrictions placed on the drug could be lifted. The question is whether this guarantees its effective return to the market.
«The situation is bad because it deprives patients of the choice we fought so hard to achieve. There are very complex diseases where treatment is expensive, and in our country, it's also limited by the available medications—direct-acting or maintenance therapy. For example, the range of medications for child psychiatry is very limited," says Evgeniya Panichevskaya, director of the Association of Parents of Children with Autism. "When such restrictive processes are launched, you look for those who benefit. This is our experience. And now we have to stage a drama. Some will shout loudly and defend their medications, others won't have the strength, and ultimately, the patients' fate will be decided by those who have no interest in them. This isn't a story about independence, it's about dependence."y.
According to Inna Ivanenko, the adopted changes allow for a simple way to eliminate foreign competitors in favor of domestic producers.
«And there's an interesting point here. Deputy Secretary of the National Security and Defense Council Oleksiy Solovyov (he was appointed to this position more than two years ago – LB.ua) actively participated in all negotiations on the bill banning drugs produced in Russia and Belarus, and subsequently on the bylaws. Both the Ministry of Health and the Verkhovna Rada committee listen to him. But it was Solovyov who headed the State Service for the Prevention of Drug Abuse during Yanukovych's presidency. And in 2013, he already tried to ban foreign drugs from the Ukrainian market by introducing additional licensing for drug imports. We prevented him from doing so back then, and there was fierce resistance from patient organizations. He's doing the same thing in a wartime environment. However, now he has a trump card in his hand: Russian aggression." she says.
The Ministry of Health notes that the law does not stipulate any preferences for Ukrainian manufacturers. "Preferences can only be granted to those companies that do not manufacture in the territory of an aggressor country that mercilessly kills our citizens," says Oleksandr Komarida.
Patient organizations have written an open letter to Volodymyr Zelenskyy, calling for the dismissal of Alexey Solovyov. They also propose amending the law to prevent the disappearance of vital European-made medications from the market.
«"For example, we can say we ban drugs if any stage of their production takes place in Russia or Belarus, or if the ultimate beneficiaries of companies supplying drugs to Ukraine are located in Russia or Belarus," says Inna Ivanenko. "Medicine is a very sensitive topic. It's not like Coca-Cola or Nike. We need to improve the entire law to maintain a balance of interests and not sacrifice Ukrainian patients."».
The Ministry of Health should theoretically be dealing with the latter above all else.
translation Skelet.Org
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