DAVOS, Switzerland — Swiss drug maker Novartis is eyeing Russia as the next big opportunity in emerging markets, after placing a major bet on China, its chairman said Friday.
Daniel Vasella said Russia's science base and large population made it an exciting prospect for investment in marketing infrastructure, drug production and research and development.
"The potential, I believe, is substantial," he said on the sidelines of the World Economic Forum. "We will only do these investments once we have a fair understanding of the risks … it is an aspiration to do it within two or three years."
Right now, however, China is at the top of the target list for Novartis and every other pharmaceutical company. It has an annual growth rate for pharmaceutical sales of more than 20 percent, fueled by a growing middle class.
Novartis unveiled plans last November to invest $1 billion in the largest pharmaceutical research facility in China and many of its rivals have also stepped up investment in the last two years.
Now Vasella is looking around for the next big emerging markets play.
"I would like to do something similar in Russia because Russia has a lot of talent and great history of science but unfortunately has lost, to some degree in some areas, the edge. I think it can regain it," he said.
Policy changes mean that Russia's drug market has been unpredictable in the past. But the government has now made the pharmaceutical sector a priority industry for development, which Vasella said could be an additional incentive for investment, provided that local and international firms were treated equally.