The Russian pharmaceutical industry is returning to the stock exchange: in 2024, after a 14-year hiatus, two manufacturers conducted IPOs. According to analysts, there will be an even larger increase in the number of initial public offerings in the next 3-5 years. In this article, we will explore potential future IPOs and explain why investors are increasingly focusing on pharmaceuticals.
The big game
The pharmaceutical industry in Russia is experiencing a significant upswing. The withdrawal of foreign manufacturers, import substitution policies, and government support—all these factors are driving companies toward new sources of financing, including the securities market.
According to analysts at National Credit Ratings (NCR), the potential of Russian pharmaceutical companies has really grown. The stock market is particularly attractive for companies that produce generic vital end essential drugs (VED). In the next 3 to 5 years, experts expect an increase in the number of IPOs and bond offerings, according to a report on the agency’s website.
In 2024, two major manufacturers—PAO Promomed and PAO Ozon Pharmatsevtika—went public and entered the stock exchange. These placements were the first in 14 years after a wave of delistings, when major players left the exchange (Pharmstandard in 2017 and Protek in 2020).
The market development is also supported by production results. According to the NCR, in 2024, the production of medicines and medical devices increased by 18%, and in the first four months of 2025, it grew by an additional 17%. According to the DSM Group, the total volume of the pharmaceutical market increased by 10% in 2024. As part of the Pharma 2030 strategy, stable growth is also expected — by an average of 4-5% per year.
“According to Rosstat, the index of production of medicines and medical materials from January to April 2025 amounted to +117.3% in annual terms,” the NCR stated.
Although imports still hold a significant market share—approximately 55% in monetary terms and around 30% in physical terms—Russia aims to increase the share of full-cycle VED to 80% by 2030.
The segment of generics and biosimilars is developing most actively, with a 14% growth in 2024. These medicines remain affordable for the public and profitable for businesses, which makes them one of the key drivers of growth.
Of particular interest is the group of antidiabetic drugs, which are increasingly used for the treatment of obesity, analysts say. This is one of the largest categories in terms of sales. According to the NCR, demand for it will grow by 10% in 2025.
Currently, the Russian pharmaceutical industry is rapidly adapting to new conditions: expanding production, increasing export potential, and attracting greater interest from investors.
A new round of IPOs
The COVID-19 pandemic has significantly accelerated the development of the Russian pharmaceutical and biotechnological industries. The crisis has exposed the nation’s critical vulnerabilities in drug safety and underscored the necessity of developing its own production capabilities and scientific infrastructure. According to Zarina Saidova, analyst at Finam Financial Group, since then, the market has shown not only recovery but also consistent growth in both technological advancements and investment activity.
The expert noted that “after the pandemic, the sector began to develop even more dynamically.” She also mentioned that the government actively supports the industry through various import substitution programs and subsidies for research and development. In addition, in recent years, interest from private and institutional investors in pharmaceuticals and biotech has increased, in recognition of these sectors as some of the most promising areas of the economy. This is due not only to the high demand for medicines and medical technologies but also to broader trends such as population aging and the rising prevalence of chronic diseases; these trends benefit pharma and biotech companies.”
She believes the appearance of Russian pharmaceutical companies on the public market was a natural step. While Western biopharmaceuticals often go public at the preclinical stage without generating revenue, Russian companies such as Promomed and Ozon Pharmatsevtika entered the stock exchange with an extensive range of products, including approved and in-development drugs. This increases investor confidence and makes the sector attractive even for those who have not previously considered biotech as an investment niche.
Zarina Saidova believes that the current IPOs are not a one-time occurrence but rather the start of a new wave. They may be followed by other companies with stable positions and research potential. “It is already evident that Russian investors have a strong interest in these specifics, and these IPOs are unlikely to lack demand,” says the expert.
This was also stated by Leonid Pavlikov, Managing Director for equity capital markets at the company. In his view, the current market environment—characterized by the withdrawal of several foreign competitors, the shift towards import substitution, and government measures to support IPOs—creates favorable conditions for raising capital through the stock market.
“Promomed and Ozon Pharmatsevtika are certainly positive examples for the industry, which may be followed by other players, in particular, Binnopharm Group, which already has experience successfully issuing bonds,” the expert added.
The pharmaceutical sector started 2025 with a moderate rise in quotations, but since March, securities have experienced a slight decline. Nevertheless, analysts still see the industry as promising: amid import substitution, government support, and increasing demand, the pharma sector is becoming increasingly attractive to investors. Promomed reports that the company’s shareholder base has increased by 250% since the start of stock trading, now totaling over 35,900 private and institutional investors.
“The public offering of shares has provided a fresh boost to our growth strategy, which focuses on the development, production, and commercialization of innovative medicines,” stated Aleksandr Yefremov, CEO of PAO Promomed.
Experts are confident that the pharmaceutical sector has already moved beyond a narrow niche and is transforming into a stable, investment-attractive segment of the stock market, characterized by clear business models and long-term growth potential.
