Eastern Europe is one of the world’s most intriguing consumer health regions. Anchored by the large Russian market, many are quick to overlook the myriad secondary markets that drive much of the region’s spending and whose unique cultural and regulatory environments vary widely. This global brief examines the key socioeconomic, health and market trends shaping the industry and provides an overview of the important OTC and VDS categories in the world’s most advanced “developing region”.
In most statistics, Eastern Europe compares well with the other developing regions. Its relatively higher wages, greater gender equality and more even income distribution provide a solid foundation for consumer goods industries.
Populations are expected to stagnate, and even decline in some markets, through 2030. While the resulting greying of the population could benefit some categories (eye health supplements, analgesics), it poses a risk to the industry’s long-term growth prospects, particularly if wages also stagnate.
High rates of alcohol and tobacco consumption weigh heavily on public health in Eastern Europe, where only two countries can boast of a healthy life expectancy at birth of over 70 years.
While access to healthcare in Eastern Europe is high relative to many developing areas, long waits at doctors’ surgeries and low rates of reimbursement have made self-care with OTC remedies a popular treatment choice in many countries.
Though Russia accounts for the lion’s share of value sales in Eastern Europe, compelling growth stories can be found in other markets such as Ukraine, Romania and Belarus.
Restrictive distribution laws, a growing crackdown on advertising and health claims, a preference for in-country production in Russia and the risk of retaliatory import/export protectionism make the Eastern European regulatory landscape one of the world’s most difficult to navigate.
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