Fildas: country rating influences suppliers

Pharmaceuticals distributor Fildas Trading, controlled by Anca Vlad, who also owns the Catena drugstore chain, posted a 7% rise in RON in the first six months of the year against the corresponding period of 2008, to 385 million RON (91 million euros).

“This growth was strongly affected by the cut in manufacturing prices as of April 1, 2009. However, after the Health Ministry recalculated margins, bringing them closer to the needs of the pharmaceutical distribution market, and as a result of the elimination of the currency risk on distribution, profitability will improve,” said Mihai Dragos, general manager of Fildas Trading.

For 2009 as a whole, the company has budgeted 770 million RON (183 million euros) turnover. In 2008, the company posted a 692 million RON (188 million euros) turnover and a 26 million RON (7 million euros) in profit.

“The factors influencing Fildas’ turnover this year are the exchange rate evolution and the payment terms of the National Health Insurance Offices. The group’s 2009 budget was built based on an average exchange rate of 4.3 RON/EUR,” added the head of Fildas Trading. He also said an important part is played by the country rating, which has a major influence on the commercial credit (discounts, deadlines) given to distributors by international drug manufacturers.

So far, the toughest period of 2009 has been the first quarter for Fildas, due to the RON’s depreciation in January and February and to the decline recorded by distribution sales in March, in the context of the new regulations that stipulated a cut in drug prices as of April 1.

Fildas Trading had 520 employees in 2008, compared with 655 in 2007. Although the distribution company operated personnel cuts, the Fildas group as a whole, which also includes the Catena drugstore chain, did not actually see cuts.

“The number of employees at group level remained relatively steady. Part of the staff was moved to other departments or business lines. The wholesale personnel cuts occurred as early as September 2008, when the crisis within the system (drug prices were not adjusted to the exchange rate for over a year) generated unbalances, which led to the management’s decision to cut any losses that could be controlled within the company. So, when the crisis hit, we had already undergone a ‘slimming diet’,” added the head of Fildas Trading.