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Foreign funds eye Greek drug companies

Foreign investment funds have been showing a growing interest in Greek pharmaceutical exporters in the last year. According to sources from the Panhellenic Association of Pharmaceutical Industry (PEF), the exporters produce drugs at a much lower cost than European peers and can sell their products abroad at a price up to three times higher than what they can get in Greece.

Foreign investment funds have been showing a growing interest in Greek pharmaceutical exporters in the last year. According to sources from the Panhellenic Association of Pharmaceutical Industry (PEF), the exporters produce drugs at a much lower cost than European peers and can sell their products abroad at a price up to three times higher than what they can get in Greece.

International investors have on occasion approached Greek pharmaceuticals in the past as they realize the tight finance conditions prevailing in the market due to the clawback and rebate measures imposed by the Greek state from the start of the crisis as a means of lower spending on drugs. The implementation of these measures, along with high tax rates, have weighed heavily on the sector.

The funds expressing interest, according to sources, have positions in European pharmaceutical companies and their proposal to Greek players normally involve the acquisition of a majority stake at low prices or an offer to take on their bank debt, often at high levels. In a number of instances, the initial contact is held between the fund and the bank.

Most of the Greek companies in the industry specialize in generic medicines that are considered to be of high quality in Europe but in Greece, they have not managed to acquire considerable market shares as most consumers prefer more expensive well-known brands belonging to large multinationals. In the event of foreign funds snapping up Greek companies in coming years, investments in research and development must increase after seeing sharp drops due to the country's economic crisis.

The pharmaceutical sector is a major contributor to the Greek economy. Its total impact on Greece's gross domestic product is in excess of 2.8 billion euros. For every 1,000 euros spent on purchasing drugs in Greece, the country's GDP is boosted by 3,420 euros. Drug companies provide work to more than 10,000 people while its total impact of employment is estimated to be in the range of 53,000 job positions.

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