Olainfarm Group lays a strong foundation for sustainable development - Seite 2

The Group's financial results for 2020 were affected by several events in the Russian pharmaceutical market. In 2020, JSC Olainfarm established a subsidiary in Russia as a long-term investment, which has been providing JSC Olainfarm product promotion activities in the Russian pharmaceutical market since September of last year. It ensures an even more accurate insight into the Russian pharmaceutical market, adjusting JSC Olainfarm supply according to customer demand. A survey carried out in the Russian pharmaceutical market confirms the effectiveness of JSC Olainfarm foreign market strategy – the recognition of the JSC Olainfarm brand has increased, thus providing a solid base for further development.

In 2020, a new medicine verification and traceability system was introduced in Russia, changing the usual delivery schedules. The Russian ruble depreciated against the euro by 32%, which had an impact on the sales and net profit of Olainfarm Group.

At the end of 2019, additional emergency deliveries of EUR 6 million were made to Russia for consumption in 2020. This reduced sales in Russia in 2020 compared to 2019.

Consolidated EBITDA in 2020 is EUR 25 million, which is a 17% decrease compared to the year 2019. EBITDA is affected by both sales revenue in certain markets and changes in operating models that result in a different cost structure than historically common.

Strategy “Forward 2020-2025”
One of the most important events of 2020 was the approval of JSC Olainfarm strategy "Forward", outlining a clear vision for the Group's future operations. The strategy intends on placing more emphasis on the development of the core business, supplementing and developing JSC Olainfarm's product portfolio by both using internal expertise and acquiring new products.

In 2020, JSC Olainfarm received the Russian Certificate of Good Manufacturing Practice (GMP), which confirms the company's efforts for maintaining the quality system and complying with the Russian market, including the requirements for production and quality control of medicines.

Although the overall impact of Covid-19 on Olainfarm Group is small, some of the ongoing product development projects have been postponed to 2021. As proposed by the European Medicines Agency, clinical trials during Covid-19 are not recommended. Therefore, the amount of Olainfarm Group's capital investments in 2020 was EUR 9.2 million, not reaching the levels forecasted. It should be emphasized that some of the projects are implemented with the co-financing of the European Union (EU).