Size Matters Less in Slovakia

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Pharma companies in Slovakia are managing to circumvent the problems inherent in the size of the local market by focusing on the country’s advantages in market access and regional leadership, as well as through joining together with affiliates in neighboring Czech Republic.

“Slovakia is a developed and established EUR 1.25 billion (USD 1.4 billion) Rx market, a similar figure to Romania which has 20 million inhabitants – whereas we are 5.4 million inhabitants.”

Branislav Budke, Pfizer

Slovakia is, in comparison to most of its regional neighbours, a small country in terms of both geography and population. Consequentially, despite progressive, reformist noises emanating from the halls of the Ministry of Health spearheaded by new Minister Tomas Drucker, the potential in the domestic pharmaceutical and healthcare markets is limited. However, some companies implanted in Slovakia are seizing the potential that the country has to offer in areas such as market access, best practice, the development of the market and Slovak culture. Others have adopted a more regional approach, identifying the potential of partnering and consolidating with affiliates in neighbouring countries to reduce costs, share ideas, and drive growth.

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Market access is a big advantage for Slovakia. For Novo Nordisk general manager Aleksandar Ciric, “Slovakia’s importance has increased due to the ease of market access … and the wide portfolio that we have available here.” Affiliates in Slovakia can bring products to market more quickly than their neighbors, meaning the country becomes a market testing ground for the region. This conception of Slovakia being a regional leader in certain areas is reinforced by Merck managing director Leonard Sojka, who states that the Merck Slovakia affiliate “belongs to the best in the region in some areas (e.g. neurology) and we frequently share our best practices with other CEE countries.”

Not only are the Slovak people an advantage for some pharmaceutical companies, but in comparison to the population of the country, the size of the market in Slovakia is actually relatively large. Pfizer Slovakia’s Country Manager and Lead Internal Medicine / Innovative Health, Branislav Budke, asserts that “Slovakia is a developed and established EUR 1.25 billion (USD 1.4 billion) Rx market, a similar figure to Romania which has 20 million inhabitants – whereas we are 5.4 million inhabitants.”

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There is a tendency for outsiders to portray Central and Eastern European countries as broadly similar in terms of culture and business. However, Jana Mittman, general manager for Exeltis Czech Republic and Slovakia, clearly differentiates between the two markets her affiliate covers and sees the advantages of the smaller Slovakia: “Whereas Slovaks tend to be creative, innovative and more adaptive, Czechs tend to be more conservative and suspicious of change and therefore need more time to understand why something is being changed.” As Exeltis works in the somewhat socially sensitive area of women’s health, the importance of the Slovak people’s openness and flexibility cannot be understated.

However, some pharma companies in Slovakia are taking advantage of the country’s similarities with its neighbours – as well as its location, infrastructure and developed market – to create regional clusters and thereby drive growth. LEO Pharma’s country manager Renata Martinakova sees the merging of the company’s Slovak and Czech operations as “the most significant success to me personally in the past two years” while Israeli generic giant Teva’s general manager for Czech Republic and Slovakia, Juan Carlos Conde, explains that “we now operate as a cluster with individual business units. I am not saying that both countries are the same, yet they are similar enough that most challenges can be solved with the same solution.” Lucia Frzonova general manager of Wörwag, yet another company that has merged its Czech and Slovak operations, agrees with Conde, pointing out a historical link between the two states: “as we were one country for many years, aspects such as client mentality and communication are highly similar.”

For Deloitte Slovakia chairman Vladimír Masár, a man who helped oversee the transition from the Czechoslovakia era as the first governor of the National Bank of Slovakia, “There is a strong spirit of collaboration amongst these small markets [in CEE], reflecting a recognition of the relatively shared cultural history and almost parallel transformation processes in the last 25 years.” For Slovakia, Masár suggests that “it is imperative that we acknowledge these common historical threads and further garner strengths as a region,” thereby negating the problems of small market size.

 


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