Drug prices are rising. The pharmaceutical company Darnitsa invested UAH 50 million in advertising during the war

The results of the comparative analysis revealed that medical products from Darnitsa are the most expensive on the Ukrainian market, and approximately 30% of their cost is associated with product advertising costs.

An integral component of the pharmaceutical business or manipulation of the consciousness of Ukrainians to obtain super-profits? Against the backdrop of the war, the largest manufacturers continue to spend a significant part of their budgets on promoting their products: the famous company Darnitsa became the largest advertiser on domestic TV last year. It is noteworthy that against this background, prices for drugs for end consumers have jumped up and drugs from this brand are among the most expensive.

What exactly makes medicines produced by Darnitsa more expensive than Ukrainian pensioners, and in whose pockets do the profits end up? But how does its owner, former MP Gleb Zagoriy, ? Investigated by StopCora journalist Diana Lovskaya .

The capital's Darnitsa company is certainly a real pharmaceutical giant, and its brand is one of the most recognizable. Advertising of Darnitsa medicines can be seen literally everywhere: in public transport, on huge pharmacy stands in the center of Kiev , billboards in different city districts, etc.

According to calculations by the communications company Razom Group, until October 2022, the largest advertiser on Ukrainian television was Darnitsa. According to their estimates, Darnitsa spent 50-60 million UAH on television advertising during this time. This is one and a half times more than Farmak, and three times more than Arterium.

“Did you guess that advertising costs not only increase the price of a company’s products, but the cost of advertising is already included in the cost of each pill they sell. Calculations show that up to 30% of the cost of each Darnitsa drug comes from advertising costs ,” the journalist comments.

Why would a company spend so much on advertising during a war?

Interestingly, the owner of the pharmaceutical giant, Gleb Zagoriy , told the press that when the company’s top management brought a significantly reduced budget in March 2022, he categorically forbade cutting investments.

It should also be noted that it is not some unique items that are sold best - millions of packages annually - under the Darnitsa brand, but fairly common types of medicines: citramon, analgin, paracetamol, acetylsalicylic acid (aspirin) and validol. At the same time, according to experts, it is the medicine of FC Darnitsa that is the most expensive on the market among domestic companies. StopCor monitored the prices of medicines from all Ukrainian manufacturers and this hypothesis was confirmed.

We analyzed prices in pharmacies for the period from March to July 2022 and saw that the prices of some drugs have increased in price. This is especially true for drugs from the Darnitsa company. Prices in pharmacies for the most common drugs during this period increased by 30-35%, for example, for analgin and citramon - by 29%, for validol - by 35.5% ,” notes analyst Anastasia Bondarenko .

It is noteworthy that during this period Darnitsa sold 26% less drugs than in 2021, but received 46% more profit from it. And the most interesting thing about the sale of medicines to FC Darnitsa is the royalties that its owner receives. According to insider information received by StopCor, this figure may be close to a billion hryvnia per year. At the same time, according to YouControl, the final beneficiary of Darnitsa changed its place of registration - now it is Cyprus, one of the most liberal tax jurisdictions.

“ We don’t want to compete over who produced how many boxes and took them outside the fence. The future of pharma is in selling services, not drugs ,” says Mr. Zagoriy.

Now StopCor is already preparing a new large-scale journalistic investigation into the activities of the pharmaceutical company - subscribe to our YouTube channel and stay tuned for updates.

Let us remind you that the capital's pharmaceutical company Darnitsa has been suing its competitor, the Borshchagovsky Chemical and Pharmaceutical Plant, for UAH 190 million for several years now. At the same time, documents on raw material import prices provided by Darnitsa raised doubts about their reliability, and therefore information about a criminal offense was entered into the ERDR.