PHARMACY 4.0

THE IMPORTANCE OF POLPHARMA IN BUILDING AN INNOVATIVE ECONOMY

Polpharma is a leader in the Polish pharmaceutical industry, a major investor, innovator and a major company among the twenty largest producers of generic drugs in the world.

In the report, we analyze the reasons for its undoubted success and how they translate into the development of the Polish economy. We also indicate the most important challenges facing Polpharma and the Polish pharmaceutical sector.

INVESTMENTS IN THE DEVELOPMENT OF PRODUCTION TECHNOLOGIES AND MANUFACTURING OF BIOLOGICAL DRUGS

Investments in biotechnology are currently considered to be one of the most future-oriented directions of development of the pharmaceutical sector:

since 2012, expenditure on the biotechnology branch of the Polpharma Group has been growing steadily,
Polpharma plans to become the only producer and manufacturer of biological drugs in Poland by investing in a production plant in Duchnice (planned launch in 2019, investment value - PLN 451,5 million) and a state-of-the-art laboratory in Gdańsk (investment value PLN 224,7 million)
The Group has acquired the innovative Dutch biotechnology company Bioceros, thus emphasizing its role in the still too narrow group of Polish companies investing abroad

POLPHARMA'S R&D EXPENSES RELATED TO BIOTECHNOLOGY (PLN MILLION)

Source: Polpharma Group internal data.

Polpharma’s expenditure on biotechnology research is growing rapidly: in 2016 it amounted to over PLN 200 million.

R&D EXPENDITURE IN THE POLISH PHARMACEUTICAL SECTOR (PLN MILLION)

POLPHARMA'S R&D EXPENSES RELATED TO BIOTECHNOLOGY (PLN MILLION)

Source: Polpharma Group internal data.

DEVELOPMENT OF A RICH PATENT PORTFOLIO

The development of Polpharma's patent portfolio includes:

substances (Polpharma has developed new methods of obtaining a number of active medicinal substances)
forms of drugs (in the case of many widely used drugs, Polpharma has managed to change the form of administration of the drug or eliminate preservatives harmful to health, thus improving the quality of patient treatment)
biotechnological innovations (despite only a few years of involvement in the development of Polpharma's biotechnology department, it was possible to obtain several patents concerning both the cultivation of new cell lines and new agents used in the production of biological substances)

PATENTS GRANTED TO THE POLPHARMA GROUP FOR ACTIVE SUBSTANCES IN THE YEARS 1999-2016

Source: Polpharma Group internal data.

Polpharma is not an occasional innovator. Successively growing expenditures on research and development (in 2012-2015 they constituted over 50% of expenditures of the entire pharmaceutical sector in Poland for this purpose) systematically translate into new patent applications.

CHANGES DRIVING POLPHARMA TOWARDS PHARMA 4.0.

Polpharma is one of the few Polish companies implementing new technologies on a large scale, which makes it a pioneer in the area of the so-called industry 4.0, i.e. a new way of organizing production and functioning of the company, resulting from the broad integration of a number of various computer-supervised processes.
Integration and further automation of organizational and production processes in Polpharma includes management of buildings, production, human resources, logistics, document flow, data visualization and processing, and the process of communication with subcontractors

CURRENT INDUSTRY 4.0 IMPLEMENTATIONS USED IN THE POLPHARMA GROUP

STRATEGIC INVESTMENTS IN HUMAN CAPITAL

The Polpharma Group accounts for 16% of all employees in the Polish pharmaceutical industry,
Salaries here are on average 12% higher than those of competitors,
The share of employees responsible for research and development in the Polpharma Group clearly exceeds the share of research and development employees in the Polish pharmaceutical industry, and their remuneration level is on average 50% higher than that of the competition,
Polpharma actively counteracts the outflow of highly qualified labour by running return programmes for Polish biotechnologists and chemists employed in Western European companies,
It also promotes the return to the abandoned cooperation with educational units by co-running dual classes at the technical school level and higher education courses with a biomedical profile at the university level.

MONTHLY SALARY IN THE POLPHARMA GROUP IN THE BACKGROUND OF THE PHARMACEUTICAL SECTOR

Source: Internal data of the Polpharma Group and the Central Statistical Office.

Every 7th employee in the pharmaceutical sector is employed by the Polpharma Group.

CONSISTENT FOREIGN EXPANSION

The Polpharma Group has a positive balance in foreign trade, the value of exports exceeds the value of imports, which gives it a unique status among other companies in the pharmaceutical sector
Polpharma adopts direct investment strategies in high-potential markets such as Russia and Kazakhstan, where it supports acquisitions and mergers with local partners and has its own drug production plants. From these countries, it exports drugs to neighboring countries with traditional trade links.
In smaller developing markets, Polpharma adopts a sales development strategy based on its own sales representatives or local distributors of medicines exported from Poland. It is present in all global markets, in a total of 60 countries - as a drug manufacturer, supplier of active substances or a company granting a license for its products

TRADE BALANCE OF THE PHARMACEUTICAL SECTOR IN 2016

Source: Own study based on data from PZPPF and business intelligence agencies: Bisnode and Infocredit.

POLPHARMA DRUGS WITH THE LARGEST SHARE IN SALES VOLUME, 2015, MILLION UNITS

Source: Polpharma Group internal data.

POLPHARMA EXPORT STRUCTURE BY TYPE IN 2015
(PLN MILLION)

Source: Polpharma Group internal data.

Over 90% of Polpharma's exports are compounded and uncompounded medicines.

IMPACT ON COUNTRY'S MEDICINE SAFETY

Polpharma, as a domestic manufacturer of drugs and active substances, ensures access to treatment for a wide range of patients in the event of unexpected events (public health crises, economic collapse, etc.)
Thanks to generic production, the prices of previously protected drugs (so-called original drugs) are reduced by 80%, which allows for a significant expansion of the group of patients covered by the therapy

THERAPEUTIC GROUPS IN WHICH POLPHARMA IS THE SALES LEADER (%)