Pharmaceutical market grows slowly in Romania but surely and companies in this sector listed at the Bucharest Stock Exchange seem to cope well with the economic turmoil. Even though, seemingly phrama stocks outperformed cyclical stocks in hard times, specialists interviewed by Wall-Street say their trend is similar to the whole market.
Pharmaceutical market in Romania was valuated at 466.5 million euros in first quarter, up 6% from a year earlier. Expressed in local currency, the pharmaceutical market climbed 22.5% up to 1.99 billion lei, as a recent Cegedim survey found.
The retail market had the largest contribution to this great performance up 23%, while hospital market soared 19.3%.
Pharmaceutical companies listed at Bucharest Stock Exchange are Antibiotice Iasi (ATB), Zentiva (SCD) si Biofarm (BIO) and Farmaceutica Remedia (RMAH).
The biggest profit growth was recorded by Antibiotice Iasi in first quarter, of 50%, up to 10.59 million lei (2.5 million euros).
Antibiotice is followed by Zentiva who posted a 7% increase in profit, up to 6.13 million lei (1.45 million euro).
Biofarm’s first-quarter profit stood at 4.75 million lei (1.1 million euros), up 6% from a year earlier.
As for Farmaceutica Remedia, the profit for the quarter ending in March 31 was 1.25 million lei (0.3 million euros).
“First-quarter results create the premises for a good performance in this financial year. Pharmaceutical companies are expected to fare better this year compared to financials or construction companies”, said Gabriel Necula, deputy trading manager at Prime Transaction.
Pharma companies “make a living” from generic drugs
The primary growth drivers of the three pharma companies listed at the stock market are their generic drugs division, which gives them an upper hand from international groups.
“Unfortunately, the pharmaceutical companies in Romania don’t have enough financial strength to shore up research or to create breakthrough drugs”, KTD Invest’s chairman Iulian Panait told Wall-Street.
Profit margins stemming from the sale of generic drugs are lower compared to other segments. The pharma companies listed at BSE largely depend on CNAS’ grants, Iulian Panait continued.
Worldwide, the big pharma industry bonanzas will be the vendors and those with global presence. The big drugmakers take up the uptrend when the market regulator approves a new drug.
“If we would rely merely on the sale of generics, as Romanian companies do, we wouldn’t cope with the market”, said Panait.
In mature markets, pharmaceutical markets are recommended in stormy times, as the demand would never dry out.
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