The drug distributor Farmexim has budgeted a turnover worth 470 million RON (138 million euros) for this year. This is an increase of 28.4% in comparison with the figure reported last year.
"Although there have been two price cuts in 2006 (operated by the Health Ministry), we exceeded the initial budget by some 5%," Ovidiu Buluc, majority shareholder of Farmexim told ZF.
The company closed 2006 with a turnover worth 366 million RON (103.8 million euros), up by 30% in RON compared with 2005. Farmexim is among the top five players operating in the drug distribution field and also one of the first companies that entered this sector in Romania.
"Farmexim has registered an annual growth of approximately 35% over the past five years. The market is expected to grow by 18-20% (this year, i.e.) and we have to exceed the market's growth by 15%," said Ovidiu Buluc.
There are over 40 drug distributors currently operating on the domestic market, but the number is expected to fall to a maximum of 5 distributors over the up and coming period. The profit margin reported by the drug distributors amounts to a maximum of 4% and is currently witnessing a downturn.
"We had an approximately 3% profit margin last year and we estimate the margin will amount to a maximum of 3.5% this year," explained Ovidiu Buluc. The growth seen by the pharmaceutical market over the recent years has boosted the turnover derived by its leaders in the market, with the top five companies having a reported turnover exceeding 100 million euros last year.
Ovidiu Buluc explains, "The value estimated is based on the evolution we have witnessed. Our growth is based on a better structure of the company, on the opening of new departments, as well as on the increase in the number of products we distribute".
Farmexim has budgeted investments worth 2.5 - 3 million euros this year, which will be mainly dedicated to the expansion of its storehouse network.
"We intend to open two new storehouses in Brasov and Timisoara in 2006 which will take up 1,000 square metres each. We also intend to expand our storehouse based in Bucharest by 1,000 more square metres," said Ovidiu Buluc, whose company currently employs 430 people.
When asked by ZIARUL FINANCIAR if he had received offers to sell the company, Ovidiu Buluc would not comment. However, he mentioned, "Farmexim is an attractive business. Considering the growth pace we are experiencing at the moment, our company is very appealing."
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