Why do Pharmaceutical Manufacturers and Banks Have to Thoroughly Check ASNA Pharmacies?
22.6.2019 13:26
On 10 June 2019, a conference titled “Unscrupulousness in the Pharmacy Retail Market: Cases of Nova Vita/LekarPharm and ASNA Network» was hosted in the press centre of Rosbalt News Agency (video of the broadcast ). The speakers included Dmitry Zhdanukhin, PhD, Law, the president of the Association of Corporate Collectors and Egor Batovkin, Head of Sales Department of the Branch of Katren Research and Production Company JSC.
Journalists and all stakeholders were told the history of incurring of debt my Nova Vita, a network of pharmacies in Moscow established by the Kabaev family. Having incurred multi-million debts through legal entities with “Nova Vita” in their names, these entrepreneurs established new legal entities using “LekarPharm” in their names. At the same time, thanks to the support of the Association of Independent Pharmacies (ASNA) www.asna.ru, they didn’t even change the signs, since both Nova Vita and LekarPharm operate under ASNA brand.
The analysis of activities of the Association of Independent Pharmacies (ASNA) revealed a strange pattern. If the pharmacy retail business is regarded positively, said organisation presents itself as a network. DSM Group Marketing Agency www.dsm.ru that specialises in pharmaceutical market researches ranked ASNA top pharmacy network following the results of Q1 2019[1]. However, as soon as the issue of debts incurred by the pharmacies operating under the ASNA sign is raised, the Association refers to independence of said enterprises and, according to the creditor, distances oneself from the issues, despite the fact that it is the cooperation with the ASNA that greatly facilitates the “switching” to new legal entities – they didn’t even have to change the sign.
Dmitry Zhdanukhin emphasised that this strange behaviour of ASNA must be taken into account by banks, suppliers, and other creditors. During the due diligence of the contractor, cooperation of a given pharmacy with ASNA will be presented as an additional positive factor. However, as the case of Nova Vita/LekarPharm shows, on the contrary, ASNA support may facilitate debt evasion. According to Mr. Zhdanukhin, during the issuance of bank guarantees, it is necessary to check whether the pharmacy or the network is mentioned at the ASNA website and make additional considerations.
Egor Batovkin told the audience that Katren Research and Production Company JSC had been maintaining a debt registry for a long time, and the debts are sometimes sold at a discount. Cooperation of pharmacies in debt with the ASNA network may be specified in said registry. The banks that issue guarantees to pharmacies, as well as contractors thereof, primarily large manufacturers (Pfizer, GlaxoSmithKline, Sanofi, Novartis, Merck & Co, etc.), should pay more attention to such registries. They may have a huge impact on prevention of uncollectible receivables and help the industry.
