Belmedpreparaty Is Nearly Bankrupt

• Artsiom Chernikau
• 18.04.2023, 21:59

The sanctions are working.

Many Belarusian enterprises faced a huge number of problems that followed after the imposition of sanctions causing a "shaped charge" effect. That is, they were crying everywhere that “sanctions are not working,” now it turns out that this is the number one problem for the Lukashists. In addition, the unleashed war closed the Ukrainian bypass route for foreign exports.

If enterprises that are oriented to the domestic market and operate at the so-called "zero" can still survive, then those whose main share of earnings is export are on the verge of bankruptcy. Belmedpreparaty is one of them. It is the largest pharmaceutical company in Belarus. About 80% of its products were exported, and 20% were distributed to the domestic market.

I've managed to talk to a former employee of the company. He said that the crisis began long before the sanctions, and they only speeded up the inevitable death of the enterprise with more than 3,000 personnel working there. Problems at Belmedpreparaty began back in 2020, long before the ban on supplies from Ukraine and the sanctions.

The Russian market has become problematic. Initially, products were sold there at little higher price than the cost, and went to the domestic market two or even three times more expensive. So, in total, it turned out that the price in the domestic market covered the low profitability of the goods when exporting. But the Russian Federation began to replace the products of the Belarusian enterprise with their own products in 2020. The development of own production increased market competition.

Belmedpreparaty began to flood its warehouses with their products. But it is worth remembering that the shelf life of medicines is quite low, and a large number of expired products had simply gone by the end of 2021.

After the start of the war, problems with the supply of raw materials from Ukraine began. There were no containers and even simple starch for the production of drug shells. They found some necessary materials in France, but thereby the production process was lowered to its minimum due to the constant waiting for the supplies. The number of shipments was reducing. If there were initially several trucks every day in the West direction, then the shipments ended one day.

According to the source, the enterprise limited its production only to coronavirus vaccine production once, because the workshop that produces 50% of export products simply lost the Ukrainian market and, in order to give employees at least some work, was forced to switch to the production of the Sputnik-Light vaccine. It also resulted in the limitation of working hours for the employees.

Despite the statements of the “appointees” about opening the market in China and India, this will not save the company, since these countries have their own fairly strong pharmaceutical companies, and the Lukashists need Belarusian exports just for show, to justify themselves to the dictator.

If previously their production volumes amounted to one million units, now it is 5,000-15,000 for the Asian market. Also, Zimbabwe can still agree to buy their products, but it is unlikely that the volume of purchases of one African country will replace Europe or Ukraine.

Even the domestic market needs no Belmedpreparaty, since this sphere is occupied by the Borisov Plant of Medical Preparations, which initially specialized in working with Belarusian consumers. And it's unlikely that the last one will face any problems.

Now the Lukashists fully recognize the effect of sanctions. Last week it became known that Siarhei Kazakevich became the CEO at the RUE Belmedpreparaty. He came just six months after Volha Yakubitskaia who was appointed to this position in September 2022.

“Sanctions are forcing the country to look for ways to further develop, including improving pharmaceutical production,” said Minister of Health Dzmitry Pinevich, introducing the new CEO. However, he did not specify how to achieve that.

After all, it's not the problem of the management system or the CEO at all. It's the problem of the economic situation in the country in general. The development of any production requires not only internal resources and personnel but also the ability to export their products to the world market, which became impossible under Lukashenka's dictatorship.

Artsiom Chernikau, especially for the Basta Telegram channel