First offset contract in Russia

FIRST OFFSET CONTRACT IN RUSSIA

Tender results

  • The first government procurement project in Russia with
    counter investment obligations to be imposed on the supplier.
  • The tender was held in Moscow in October 2017.

14 billion rubles contract price

  • Initial contract price reduction: ~ 50%. Initial maximum contract price is 28.8 billion rubles (~4,12 million rubles per year)
  • Investment amount is at least 3 billion rubles (at least 70% of which shall be used for creating an item of real estate and equipment)

BIOCAD winner of the tender

  • 2 applications were submitted, the winner is BIOCAD
  • BIOCAD was granted the status of a Technopolis Moscow SEZ resident
  • BIOCAD entered a lease agreement

Tender terms and conditions

10 years contract validity period

  • The subject of procurement is 22 medicines of the «oncology and immunomodulators» group.

3 years to start up the production

  • Until 2020: packaging localization and quality control for 22 INN*
  • Until 2021: finished dosage form localization for 22 INN*, substance production, but not less than 2 INN*

7 years to supply localized products

* - INN is an international non-proprietary name

Advantages of an offset contract

For the investor-supplier:

Large procurement volume

Moscow is a financially reliable and stable consumer

Moscow procurement volume is 550 billion rubles per year

Long-term sale guarantees

Contract validity period is up to 10 years

In addition, upon the fulfillment of investment obligations
inclusion of the investor in the regional register of sole suppliers

For the public side:

Price reduction due to long-term ordering

Production start-up, modernization and / or development - parameters
to be determined by the customer

Import substitution, localization, industrial safety improvement, jobs creation and tax base expansion

Priority fields for offset contracting

Medicines
and medical products

Transport

Equipment
for housing and communal services

Technical equipment /
Machinery, etc.

Computers and
telecom equipment