IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 01 Oct 2015 | Removal date: open ended
Still in force

Production subsidy

Decree No. 1047 introduces rules for the granting subsidies that affect the pharmaceutical and medical sectors. These subsidies are for partial compensation of expenses for the realisation of projects for production of medicines and (or) pharmaceutical substances. 

The subsidies under Decree No. 1047 are provided to registered in Russia organisations that have a license to manufacture drugs for medical application. An important condition that the potential beneficiary must fulfil in order to obtain state subsidies under Decree No. 1047 is to prove that s/he is able to generate income not less than 5 times the amount of the obtained subsidy for a total period of 3 years starting from the date of the commercial launch of the subsidised good (Article 6 of Decree No. 1047).

The provided official note that accompanies Decree No. 1047 states that it (together with other indicated as related state acts by the GTA) "will contribute to import substitution in the pharmaceutical and medical industries, will enhance the investment activity of the Russian organisations with the goal to create and modernise the production, will increase the share of domestically produced medicines and medical products, will create high-performance workplaces."

The state subsidies target the development of the innovative potential of the local pharmaceutical and medical industries. They form part of the state programme for the development of the pharmaceutical and medical production in the period 2013--2020 ("state programme").

The state subsidies also have the concrete purpose of achieving the target values of three quantitative indicators. They are set in the sub-programme No. 1 "Development of production of medicines" of the state programme as follows:

  • a share of domestic production of medicines in the total volume of consumption (defined in billion Russian Roubles),
  • a volume of investments in scientific research, development, technological innovations and re-equipment of production of medicines (defined in billion Russian Roubles)
  • implementation of the action plan on import substitution in the pharmaceutical industry, for whose products there does not exist a domestic manufacturer. These medicines are not indicated in Decree No. 1047. The state programme (point 2 and 3 of the list
    with state programme's main activities) indicate that these medicines must be innovative and must be designed for treatment of socially significant diseases.

 

The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets and from foreign subsidiaries.

 

AFFECTED COUNTRIES

MAP
TABLE
EXPORT

AFFECTED SECTORS AND PRODUCTS

352 Pharmaceutical products
3003 Medicaments (excluding goods of heading 30.02, 30.05 or 30.06) consisting of two or more constituents which have been mixed together for therapeutic or prophylactic uses, not put up in measured doses or in forms or packings for retail sale.
300310 Containing penicillins or derivatives thereof, with a penicillanic acid structure, or streptomycins or their derivatives
300320 Containing other antibiotics
300331 Containing insulin
300390 Other
3004 Medicaments (excluding goods of heading 30.02, 30.05 or 30.06) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses (including those in the form of transdermal administration systems) or in forms or packin
300410 Containing penicillins or derivatives thereof, with a penicillanic acid structure, or streptomycins or their derivatives
300420 Containing other antibiotics
300431 Containing insulin
300432 Containing corticosteroid hormones, their derivatives or structural analogues
300439 Other
300440 Containing alkaloids or derivatives thereof but not containing hormones, other products of heading 29.37 or antibiotics
300450 Other medicaments containing vitamins or other products of heading 29.36
300490 Other

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