March 3 (Reuters) – Western drugmakers and medical technology companies warn their plans to continue selling products to Russia could be hampered by economic sanctions targeting the country and its big banks as punishment for Moscow’s invasion of Ukraine.
Sanctions imposed on Russia by the United States, Britain, Europe and Canada do not apply to medicines and medical devices, and industry has a responsibility under international humanitarian law to continue supplying those products, industry groups, policy experts and company officials said .
International aid groups are urging that essential medicines continue to flow into Ukraine, where Russian troops are attempting to seize control of major cities, causing more than 870,000 Ukrainians to flee their country and millions to seek shelter from airstrikes. Pharmacies are already reporting bottlenecks in medical care. Continue reading .
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Many western companies said they would stop selling everything from cars to films in Russia. Transactions related to drugs and medical devices and food were approved despite US and EU sanctions.
But sanctions that cut off Russian banks from the international financial system, as well as decisions by major shipping companies to stop serving the country, could also hamper the delivery of medical supplies.
The removal of seven Russian banks from the international SWIFT payment system, as well as the ongoing attack on Ukraine, could cause disruption, said MedTechEurope, the European lobby group for medical device companies. Without access to this payment system, it becomes more difficult to do business with Russia. Continue reading
“The freeze on bank transfers could indeed affect the export of medical devices from the EU to Russia and we are actively investigating the extent and will see how the situation develops,” said the MedTechEurope spokesman.
The European Federation of Pharmaceutical Industries and Associations issued a statement calling for the safe distribution of medicines and vaccines to those in need in Ukraine, neighboring EU member states and Russia.
US drug industry group PhRMA said it supports further exemption from all sanctions for drugs and the materials needed to make them.
Under international humanitarian law, everyone has the right to access basic medical services and supplies, including medicines and vaccines, said Lawrence Gostin, a public health law expert at Georgetown University.
“In times of conflict, this right to uninterrupted access to essential medical supplies has often been violated,” Gostin said. “Governments that impose sanctions should also make an exception for medical care. But sanctions often disrupt medical services and supply chains.”
The United States approved transactions involving the export or re-export of drugs and medical devices with Russia in a general license issued last week. It has also issued carve-outs for energy-related payments and international organizations, among others.
The US Treasury Department declined to comment on the issue.
According to Eurostat data, the EU supplied Russia with medicines worth 6.5 billion euros ($7.23 billion) in 2020, accounting for about 8.4% of the region’s total exports to Russia. According to MedTech Europe, medical equipment worth around 1.6 billion euros was sent to the country in the 12 months to September 2021.
US government data shows that pharmaceuticals and medical devices accounted for about 8% of all US goods exported to Russia in 2021. It shipped $355 million worth of medicines and $157 million worth of medical equipment to the country.
Leading shipping group AP Moller-Maersk (MAERSKb.CO) warned on Wednesday that shipments to Russia, including medical supplies, could be damaged or spoiled due to significant delays at ports and customs. Continue reading
Drug makers including Switzerland’s Novartis (NOVN.S), Denmark’s Novo Nordisk (NOVOb.CO) and Lundbeck, UK’s GlaxoSmithKline (GSK.L) and US-based Eli Lilly said they were working to ensure that patients continue to have access to their medicines.
Novo Nordisk, the world’s largest maker of diabetes drugs, said it will “do everything we can to keep supplies in Ukraine and Russia alive,” but expects sanctions will make that difficult. There have already been problems with the delivery of medicines to Ukraine.
“Drug supplies may be indirectly affected by sanctions in other areas, and we will do everything we can to ensure the citizens of Russia receive their life-saving medicines,” Novo Nordisk said in an emailed statement.
Lundbeck, which specializes in treating depression, said it will continue to serve patients who need medication in Russia.
“As long as we can provide medication to patients in Russia within the current sanctions, we will do so,” Chief Commercial Officer Jacob Tolstrup said in a written comment.
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Reporting by Francesco Guarascio in Brussels, Michael Erman in New Jersey and Stine Jacobsen in Copenhagen; Additional reporting by Jennifer Rigby in London, Jason Lange and Daphne Psaledakis in Washington, Julie Steenhuysen in Chicago and Dan Burns in New York; Edited by Caroline Humer and Bill Berkrot
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