How the Russian pharmaceutical market will develop in 2025

According to the professional community, 2024 was generally a successful year for the Russian pharmaceutical industry. Domestic manufacturers actively increased their presence in the Russian market and increased their export potential, despite the ongoing difficult economic conditions. The share of Russian pharmaceutical manufacturers in drug clusters currently exceeds the share of foreign companies, although imported drugs with changed company names continued to enter the retail segment. In physical terms, 65% of drugs sold on the market in 2024 were produced in Russia. In monetary terms, domestic products account for 49%. The indicators are also relevant for the first months of 2025.

Current situation

In 2024, according to a report by Alpharm, the volume of the Russian pharmaceutical market, including dietary supplements, medical devices and related products, reached 3.1 billion rubles. This is 17% higher than the 2023 figure. In physical terms, sales amounted to 8 billion packages, and excluding dietary supplements and assortment, the market volume in monetary terms is 2.6 billion rubles.

The statistics were also presented by the analytical agency DSM Group. According to the analytical agency DSM Group, last year the market grew in monetary terms by 14% in retail and by 3% in the public procurement sector. At the same time, the number of purchased packages of drugs over the year decreased by 2.3% and amounted to 4.4 billion. The nature of consumption is changing - buyers began to give preference to more economical packages containing more tablets.

As for the cost of drug packaging, the indicator has grown by almost 17%. Experts note an increase in the consumption of drugs costing over 1,000 rubles, their market share already amounts to 30-35%. Despite the fact that in the production of finished forms of drugs it was possible to achieve growth of certain indicators, a high dependence on the import of pharmaceutical substances remains . Today, more than 75% of APIs are of foreign production, among the leaders in imports are China (more than 50%), Europe (29%) and India (17%). By the way, in 2023, the volume of API production in Russia amounted to about 10% of imports, and if we leave only those companies that produce chemical synthesis, then 6-7%.

It is worth mentioning here the entry into force of the state procurement regime – the “second extra” mechanism. According to it, applications for the supply of foreign products will be rejected if at least one offer of Russian origin appears within the framework of the state procurement tender.

As analysts note, the mechanism is intended to help localize APIs and drugs, but, on the other hand, the innovation may serve as a driver for market monopolization, a reduction in the range of international non-proprietary names, and lead to some other difficulties.

As for the medical devices sector in the Russian Federation, the share of domestic production is about 30%.

It is also important to mention the development of veterinary drug production. According to statistics from the National Veterinary Association, the largest part of the veterinary drug market in Russia is made up of:

• Sector of preparations for pets and agricultural animals: cats and dogs – 33.1 billion rubles (34%), agricultural – 64.6 billion rubles (66%);

• Immunobiological and chemical-pharmaceutical drugs: injections – 32.1 billion rubles (33%), in tablet form – 65.6 billion rubles (67%).

   

According to market dynamics, according to a number of experts, the market volume is expected to be 176.8 billion rubles with VAT by 2030. At the same time, imports are gradually being replaced by domestic and Belarusian manufacturers. The share of domestic companies, according to the report of the National Veterinary Association, increased in 2024 from 42% to 46%. As of November, 95 manufacturers were producing in the Russian Federation, 13% were state organizations, and 87% were commercial companies. Significant market development requires an increase in the range of drugs and increased government support measures.

The market for biologically active supplements demonstrated a clear increase . According to the analysis of the dietary supplement market in Russia by BusinesStat, in 2024 their production in Russia increased by 6%: from 411 to 436 million packages. Domestic dietary supplements account for about 80% of all sales of this type of product in the country. The growth of this indicator is due to the departure of a number of foreign manufacturers and importers, as well as the blocking of one of the largest international marketplaces in the Russian Federation.

In total, over the past five years, the number of companies producing dietary supplements has increased to 1,300.

The range of products is also expanding - today there are approximately 14 thousand items on the market. It is important to note that the dietary supplement market in the country is significantly consolidated. According to estimates by the professional community, 60% of the market is represented by 20 leading manufacturers. The second distinctive feature is the demand for contract manufacturing, especially in connection with the greater popularity of private labels in the food industry, retail and other industries.

In the natural cosmetics segment , as experts from the Center for Macroeconomic Analysis and Regional Forecasting of the Russian Agricultural Bank (RSHB) say, a multiple increase in demand and production is predicted. The drivers are a steady increase in the consumption of organic products, standardization of production and expected government support for the industry.

According to the Russian Agricultural Bank, the volume of natural cosmetics production in the Russian Federation in 2024 was about 2.5 billion rubles. In the first quarter of 2024, demand for cosmetics made from natural ingredients increased by 47% compared to the same period in 2023. The top categories in demand included hair care products (demand increased 4 times), facial skin care products (demand increased 3 times), and body care products (demand increased 2 times).

Challenges and Prospects of the Pharmaceutical Market in the Russian Federation

The main challenges include not only the continued dependence on imported substances, but also the maintenance, repair of existing equipment and the purchase of new equipment for the production of substances, drugs, and packaging. Today, domestic market players purchase equipment and spare parts, primarily of Chinese manufacture: Tofflon, Sinopharmtech, Truking, Keno Pharma. Supplies of Indian equipment manufacturers are also carried out in the Russian Federation: ACG, Concept Engg and others. Since the summer of 2023, domestic companies have begun cooperation in this area with Turkish manufacturers.

Another serious challenge is the necessary transition from the production of Russian generics to the release of innovative drugs. In this area, collaboration with foreign players is again extremely important for local companies. Both parties will benefit from cooperation: foreign suppliers will get a reliable partner on the Russian market, while Russian companies will be able to cover important needs and optimize costs.

The Russian pharmaceutical market as a whole will soon be influenced by new national programs, including the projects "Long and Active Life", "Family" and "New Health Preservation Technologies". The latter, according to market experts, will affect the sphere of production of medicines and medical devices.

As Deputy Minister of Industry and Trade of the Russian Federation Ekaterina Priezzheva noted, one of the goals of the project is to increase the share of drugs on the list of vital and essential drugs of domestic production to 90% (by the way, market participants are expecting the government to approve the criteria for including drugs in the list of strategically important drugs). Today, Russia produces about 77.5% of the nomenclature of vital and essential drugs using ready-made forms and a full cycle.

The focus will also be on increasing the production of medical products – their overall market share should grow from 29% to 40% by 2030. In addition, the goal has been set to obtain 80 new types of raw materials and materials produced in Russia by this date.

The professional community forecast for 2025 is an increase in the Russian market volume to RUB 2.8 billion, by approximately 8–10%. At the same time, the retail segment will retain its leadership with a share of 63% (+18%), and the state segment will increase to RUB 983 billion (+24%). Analysts also predict a further increase in drug prices. This will be facilitated by weakening imports, a shortage of qualified personnel, a probable decrease in GDP growth, and a decrease in the population of the Russian Federation.

Among the growth drivers from a regulatory perspective today are:

• unification of standards with countries open to partnership to simplify the export of Russian medicinal products (reduction of the federal income tax rate for exporters, subsidization of interest rates on loans, subsidization of transportation costs) and simplification of the import of APIs, equipment, and spare parts;

• financial support for the development of new advanced therapy drugs;

• stimulating the use of modern methods for conducting fundamental and clinical research;

• support for scaling up existing innovative production (in particular, for export).

How the Pharmtech & Ingredients exhibition contributes to the development of the pharmaceutical market in Russia

The growing pharmaceutical market is open to new players ready to enter, including into vacated niches. Participation in the Pharmtech & Ingredients exhibition, the largest industry event in Russia and the EAEU countries, allows you to study its features, find solutions to problems in the professional community, communicate with leading industry experts, and find new partners. The 26th International Exhibition of Equipment, Raw Materials and Technologies for Pharmaceutical Production Pharmtech & Ingredients, held in 2024, was attended by 568 companies from Russia, Belarus, China, India, Italy, Spain, Turkey, Hungary, the UAE and other countries. The exhibition was visited by 10,345 unique specialists (10,011 in 2023). At the same time, the share of key visitors was 85% or 8,802 specialists, 4,275 (41%) of whom came to search for products and services for business. The share of decision makers was 69% or 6,060 people (67% in 2023).

The exhibition exposition for 2025 is already 80% formed and is over 8,500 sq.m. More than 200 companies from 9 countries have joined Pharmtech & Ingredients so far.

Present your products to industry professionals at the 27th International Exhibition of Equipment, Raw Materials and Technologies for Pharmaceutical Production Pharmtech & Ingredients on November 25–28, 2025.

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