We Wouldn’t Mind If You Died of AIDS and Hepatitis C

aids flagRussia has an HIV epidemic. According to the Federal Aids Prevention Center, approximately a million Russians are infected. A third of them also have hepatitis C. At best, only hundreds of these patients receive state-of-the-art treatment. Image by Yaroslava Chingayev, special to Vedomosti

Officials Want to Replace Current Hepatitis C Treatment with Outmoded Therapy
Industry and Trade Ministry Supplied Money for Manufacture of Drugs
Irina Sinitsyna and Olga Sukhoveiko
Vedomosti
December 13, 2018

The Russian Health Ministry plans to significantly reduce procurements of the most effective treatment for viral hepatitis C, combined interferon-free treatment, thus reducing the availability of the drugs for patients infected with HIV in combination with hepatitis B and hepatitis C. Instead, the ministry has proposed putting these patients on interferon therapy. Maria Onufriyeva, director of Community of People Living with HIV, an interregional grassroots organization, has written about the matter to Health Minister Veronika Svkortsova. Ms. Onufriyeva has also sent a letter to Valery Alexeyev, director of the Honest Procurements Project at the Russian People’s Front (ONF). Vedomosti has seen copies of the letters. Ms. Onufriyeva confirmed she sent them. A spokesperson for Mr. Alexeyev said he received the letter. The Health Ministry has not responded to her query.

In November, Minister Skvortsova said that over 714,000 Russians were infected with HIV. According to the Federal Aids Prevention Center, whose figures Ms. Onufriyeva cites, there are 978,443 Russians infected with HIV. A third of them also have hepatitis C.

In late October, the Health Ministry published the final list and amounts of drugs it would be procuring in 2019 and providing to HIV patients, including HIV patients who also have hepatitis B and hepatitis C, writes Ms. Onufriyeva. (Vedomosti has seen a copy of this list.) In particular, the Health Ministry wants to reduce procument of dasabuvir by 750%, meaning one hundred patients would have access to the drug, while this year 748 people could count of getting it, according to the Community’s calculations.

In monetary terms, this would mean a drop in expenditures on the drug from 431.6 million rubles [approx. 5.7 million euros] to 57.9 million rubles [767, 754 euros].

The Health Ministry plans to switch to narlaprevir, intended for the treatment of hepatitis C in combination with other antiviral drugs. In 2018, as the Community has discovered, and as is borne out by information accessed on the federal procurements website, narlaprevir was not purchased by the Russian governmennt. In 2019, the Health Ministry could spend 139 million rubles [approx. 1.8 million euros] on procuring the drug in order to treat 430 people, the Community argues.

Dasabuvir is the most up-to-date antiviral drug. According to the Community, it can cure 98% of hepatitis C patients in twelve weeks.

This figure was confirmed by Vadim Pokrovsky, director of the Federal AIDS Prevention Center.

In Russia, HIV patients who also have hepatitis C have been treated with dasabuvir in combination with ombitasvir/paritaprevir/ritonavir, manufactured under the brand name Viekira Pak by the American company AbbVie. Dasabuvir was placed on the official Russian list of vital and essential drugs for this year. Two years ago, Alexey Repik’s R-Pharm and AbbVie agreed to partly localize manufacture of the drug at R-Pharm’s plant in Kostroma. As R-Pharm reported then, the deal covered repackaging of the drug and quality control. According to AbbVie, Viekira Pak is distributed in Russia by R-Pharm and Euroservice.

Ms. Onufriyeva writes that interferon therapy is much less effective in treating chronic hepatitis C patients with HIV. The treatment significantly reduces quality of life, since it requires weekly injections.

Mr. Pokrovsky explained the difference. Interferon treatment has almost no effect on the virus itself. It stimulates the body’s immune response, but it has numerous side effects, from impotence to mental disturbances. The treatment lasts a year.

Due to the length of the treatment, Ms. Onufriyeva said, it was between 52% and 133% more expensive than interferon-free treatment.

Tableted by R-Pharma, narlaprevir has to be taken together with ritonavir, pegylated (long-acting) interferon, and ribavirin, as indicated in the instructions.

In 2012, R-Pharma acquired a license for the production and sale of narlaprevir from Merck & Co. It tried to refine the drug with support from a federal targeted program administered by the Russian Industry and Trade Ministry. Trade publication Vademecum wrote that R-Pharm invested 700 million rubles in narlaprevir. The Industry and Trade Ministry would allocate 120 million rubles on clinical trials, Sergei Tsyb, head of the ministry’s Department for Chemical Engineering and Bioengineering, promised in 2012.

A R-Pharm spokesperson confirmed receipt of the funds.

R-Pharm registered narlaprevir in 2016. In the spring of 2017, during a meeting with the business community, President Putin promised R-Pharm’s director general Vasily Ignatiev that the government would allocate funds to procure the company’s drugs for hepatitis C patients.

“I will also keep this in mind when allocating resources for healthcare in 2018 and the following years, in 2019 and 2020. It will be necessary, of course, to use what you have developed,” Putin said.

Mr. Pokrovsky is certain the Health Ministry’s decision to reduce procurements of interferon-free drugs could have been influenced by Russian manufacturers wanting to compensate their costs at the state’s expense.

The R-Pharm spokesperson insisted that the company, like other manufactures, received a request from the Health Ministry to quote its prices for narlaprevir and dasabuvir.

“Our price offers for the drugs were the same as last year’s,” he said.

In total, according to the Community’s calculations, in 2019, the Health Ministry can spend 473.5 million rubles [approx. 6.3 million euros] on the procurement of drugs for treating chronic hepatitis C, as opposed to 1.1 billion rubles [approx. 14.6 million euros] last year.

In November, Vademecum wrote that, in 2019, the Health Ministry would also reduce its overall procurement of antiretroviral drugs under its program for providing drugs to people infected with HIV, including patients who were infected with HIV in combination with the hepatitis B and C viruses. However, although it would spend far less money, it planned to expand coverage to a mere sixty percent of those needing treatment.

Ms. Onufriyeva has asked the Health Ministry to consider increasing procurements and moving away from the chronic hepatitis C drugs scheduled for purchase in 2019 and towards drugs that have proven effective. The latter should be supplied to patients with HIV plus viral hepatitis C, including those suffering from advanced liver fibrosis and cirrhosis.

She has asked Mr. Alexeyev to assist her in protecting the interests of patients by sending inquiries to the Health Ministry, asking them to explain the reasons for the cuts in procurements and the selection of outmoded drugs. She also asked him to verify whether the Health Ministry’s actions were in compliance with antitrust laws.

She told Vedomosti she had not received replies to her letters.

vich

“How the Numbers of HIV-Infected Patients Have Changed, 2013–2018.” The red columns indicate total numbers of patients; the orange columns, first-time infections. Figures are given in thousands of people. Source: Rosstat. Courtesy of Vedomosti

Mr. Alexeyev explained the delay in replying. The letter contained a good deal of specialized and medical information, and it was under review by independent experts working for the Russian People Front’s Honest Procurements Project.

“The Russian People’s Front has drawn attention to problems with the list of essential and vital drugs, and their procurements, and this letter is the latest alarm,” he said.

According to Mr. Alexeyev, the Russian People’s Front has been reviewing the Health Ministry’s procedure for including medicines on the list and had already been in touch with the government.

hep b and c

“How the Numbers of Hepatitis Patients Have Changed, 2013–2018.” The dark blue bars indicate first-time cases of chronic hepatitis B; the light blue bars, first-time cases of chronic hepatitis C. Figures are given in thousands of people. Source: Rospotrebnadzor. Courtesy of Vedomosti

If the grassroots organization Community of People Living with HIV believes the industry regulator acted in a way that violated specific regulations on procurements or antitrust statutes, it can file a complaint with the Federal Anti-Monopoly Service (FAS) in the manner prescribed by law, said Maxim Degtyarev, deputy head of the Department for Oversight of the Social Sector and Trade at FAS. For the time being, however, FAS had no grounds to perform an inspection.

The Industry and Trade Ministry did not respond to our request for information.

Elena Filimonova contributed to this article.

Translated by the Russian Reader

Latifundism in Russia

Land Prices in Russia Reach Five-Year High
Farmland may become cheaper next year
Irina Sinitsyna
Vedomosti
December 6, 2017

The cost of farmland in Russia’s primary grain-producing regions reached its five-year peak in 2017, as valued both in rubles and dollars. This conclusion was reached by analysts at Sovecon, an agro industry research center, based on the results of an annual survey.

Amongst the fundamental reasons were the record profits made by agricultural producers in the 2016–2017 season, sparked by good harvests and relatively high ruble prices for most commodities, says Andrei Sizov, Sovecon’s director.

In addition, there has been consistently strong demand for land on the part of predominantly Russian capital in the guise of industry-specific investors, Sizov adds. Amongst the most active public buyers, Sizov identified the agricultural division of Sistema, the N.I. Tkachov Agrocomplex, owned by the family of Alexander Tkachov, Russia’s agricultural minister, and Volgo-Donselkhozinvest, owned by the family of Sergei Kukura, adviser to Lukoil president Vagit Alekperov. New players, such as the companies owned by Roman Avdeyev, have also continued to expand into the agro business. On the year, from the fourth quarter of 2016 to the third quarter of 2017, Sistema’s subsidiaries increased their land holdings by one and a half times, from 247,000 hectares to 380,000 hectares. In the spring, Volgo-Donselkhozinvest closed a deal to buy the Russsian assets of the Swedish company Black Earth Farming: a total of 244,000 hectares. In late 2016, Avdeyev’s investment vehicle Rossium purchased 99% of the Lipetsk agro holding Agronova-L, which grows grain and oilseeds on more than 70,000 hectares in Lipetsk and Tambov regions.

At the same time, Russian farmlands are still undervalued compared to agricultural land in other countries, for example in Eastern Europe, adds Sizov. In several regions such as Kursk Region, however, land prices are unjustifiably inflated, argues Alexander Krasnov, head of the legal department at the agro holding Miratorg.

Land has gone up in price in recent years, but this year growth slowed or even halted, notes Vladislav Novoselov, managing director of agro industy consulting company BEFL. According to Novoselov, the main cause of the previous price rise was an increase in agriculture’s profitability, due largely to devaluation.

In the coming year, the growth of the value of land in southern Russia could slow down significantly, and in regions located farther from export ports, land prices could stagnate altogether or even decrease, argues Sizov.

Domestic prices for all major agricultural products, especially grain, fell precipitously this year amidst a bumper grain harvest, explains Sizov. According to Sovecon, in November, the main export commodity, fourth-class wheat, was 10% cheaper in southern Russia than a year ago, 20% cheaper in central Russia, and cheaper by a third in the Volga River basin. In 2017, prices for all major commodities declined significantly, Novoselov agrees, and problems with storage and transportation considerably reduced the incomes of market players. Many of yesterday’s land buyers have taken a break in anticipation of lower prices, says Novoselov.

Especially in Russia’s central regions, land prices have already fallen, Krasnov points out.

“You can now buy land for 10% to 15% less than at the beginning of the year,” he says.

At the same time, he adds, the quality of the land on offer has improved. There is a selection of large land plots of 5,000 hectares to 6,000 hectares, and there is more cultivated land on offer. Earlier, they would have been sold for a premium, he recalls, but not anymore.

In addition, the number of speculators has decreased significantly, continues Krasnov. Holding land in anticipation of price rises is no longer profitable due to high taxes and fines for those who do not cultivate their land.

fullscreen-4ltPrices of farmland in Krasnodar (red), Rostov (dark blue), Stavropol (light green), Voronezh (beige), Tambov (violet), and Kursk (light green) from 2012 to 2017, as valued in rubles/hectare and dollars/hectare, and compared with the prices of farmland in Great Britain (Wales and East Anglia), the US (Kansas and Iowa), the EU (Romania), Brazil (Mato Grosso), Uruguay, and Russia (Krasnodar), as valued in dollars/hectare. Source: Sovecon. Courtesy of Vedomosti

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Agrocomplex Owned by Ag Minister’s Family Fourth Largest Farmland Holding in Russia
It lacks 4,000 hectares to claim third place
Yekaterina Burlakova
Vedomosti
April 25, 2017

The three leaders, as determined by the consulting company BEFL, have not changed over the past year. In first place is Igor Khudokormov’s Prodimex group (including Agrokultura’s assets), which controls 790,000 hectares of farmland. Rusagro surpassed Miratorg: they now own 670,000 hectares and 644,000 hectares, respectively (cf. the infographic, below). Rusagro’s director general Maxim Basov confirms the figures. A spokesperson for Miratorg refused to comment on the list. Nikolai Shevchenko, head of Prodimex’s agro division, cites figures that do not take into account Agrokultura, since it is Khudokormov’s personal project, leaving a total of a little over 600,000 hectares.

The N.I. Tkachov Agrocomplex in Krasnodar Territory has risen from sixth place to fourth place, having increased its holdings by 40% to 640,000 hectares. The agrocomplex lacked a mere 4,000 hectares to join the top three. The N.I. Tkachov Agrocomplex was found in 1993 by the father of the current Russian agriculture minister, Nikolai Tkachov. The company grows grain, is one of the major producers of raw milk in Russia, and the second largest rice producer. The agrocomplex also produces produces pork and beef, and has been developing a chain of stores. It currently runs over 600 stores in Krasnodar Territory, Stavropol Territory, and Rostov Region.

In recent years, Tkachov Agrocomplex has vigorously increased its land holdings: in last year’s BEFL rating, it entered the top ten for the first time. In 2015, it purchased the assets of the major agro holding Valinor, which owned land in southern Russia. A former top manager at Valinor informed Vedomosti the Tkachov family acquired 170,000 hectares in the deal. The agrocomplex continued its acquisitions in 2016. In the summer, it was reported the company had purchased over 30,000 hectares of rice fields, previously owned by the Razgulyay Group. Several months later, the Tkachovs bought Parus Agro Group, a major Krasnodar agro holding, from Andrei Muravyov, ex-president of Siberian Cement and ex-Qiwi shareholder. Parus Agro had controlled nearly 100,000 hectares of arable land in Krasnodar Territory, Stavropol Territory, and Adygea. Over the past three years, Tkachov Agrocomplex has increased its land holdings by 440,000 hectares, more than tripling them, according to BEFL.

Tkhachov Agrocomplex director general Yevgeny Khvorostin declined to comment for this article.

Vladimir Yevtushenkov‘s Sistema increased its land holdings most significantly. Its subsidiary, the agro holding Steppe, added 200,000 hectares over the past year, according to BEFL. Taking into account RZ Agro, which Sistema co-owns with the Louis Dreyfus Company, the corporation’s land holdings have risen to 350,000 hectares. Steppe has continued to increase its land holdings by acquiring assets, as stipulated by its overall strategy, says a spokesperson for Steppe. The goal is to increase its holdings to 500,000 hectares, company management has announced.

The past year was quite productive for major agro holdings, according to BEFL’s survey. The companies included in the 2017 list own a total of more than 12 million hectares of land, which is approximately 14% more than a year earlier. BEFL managing director Vladislav Novoselov says the last three years have witnessed a vigorous consolidation of the market. The fact is that, due to devaluation of the ruble, the return on investment in crop production has increased. Sistema’s spokesperson also agrees with this assessment.

In 2016, for the first time in three years, not only ruble, but dollar prices began to grow, Sovecon reported earlier. In Russia’s southern regions, agricultural commodity prices grew from 31% to 83%; in the central regions, from 6% to 17%; and in the Volga River basin, from 1% to 36%.

Late last year, however, it was obvious that in the future the profitability of crop production would not be so high. Domestric prices for agricultural produce have not been growing, and they have even declined for some commodities, partly because of the ruble’s resurgence, says Novoselov. Rusagro’s Basov confirms this is the case. Nevertheless, his agro holding has continued to acquire land. Taking into account the decreasing margin, land prices must drop for deals to go through, he concludes.

mobile_high-2p72017’s top ten corporate owners of farmland in Russia, in thousands of hectares. The second set numbers (in gray, in the far right column) indicates their places in the 2016 rating. 1. Prodimex + Agrokultura (790,000 ha); 2. Rusagro (670,000 ha); 3. Miratorg (644,000 ha); 4. N.I. Tkachov Agrocomplex (640,000 ha); 5. Ak Bars Agro (505,000 ha); 6. Ivolga Holding (489,000 ha); 7. Rosargo (400,000 ha); 8. Avangard-Agro (390,000 ha); Steppe + RZ Agro (350,000 hectares); Dominant Group (320,000 ha). Source: BEFL. Courtesy of Vedomosti

If you are interested in how this runaway latifundism has affected family farming in Russia, read my series of posts on the Krasnodar farmers’ protest movement and their allies in the Russian independent truckers’ movement.

Translated by the Russian Reader