Moscow, 11 February, 2010 – JSC Pharmstandard (LSE: PHST LI, RTS: PHST RU) announces its unaudited 2009 sales results. The total revenue of the Company for the year increased by 68.1% and achieved RUR 24,095 million (or US$797[1] million).

Highlights:

·         Pharmstandard won the government tenders in 2009 under 7 nosologies program (part of FRP) for oncology diseases treatment preparations. Pharmstandard acts as a distributor of Velcade® (bortezomib), original prescription product of Janssen-Cilag, and supplied Velcade® for the total amount of RUR  3, 661.9 mln

·         Pharmstandard won the government tenders in December 2009 to supply products in year 2010 under FRP program for the total amount of RUR 2,627.1 mln for the following products –Dornaza alfa, Rastan (Somatropin), Coagil IV (IV blood factor).

·         Pharmstandard signs an agreement with Pharmapark on marketing and exclusive sales of Altevir® (gepatology). Starting from April 2009, sales of Altevir® achieved RUR 32.2 mln;

·         The efficacy of Arbidol® for prevention and treatment of “swine influenza” (А / H1N1/ «California 04/2009» strain) has been proven by major Russian virology scientific centres;

·         Pharmstandard and ZAO “Apteki 36.6” signed an agreement on direct collaboration, sales achieved RUR 257.7mln from 2q 2009. Pharmstandard delivers its products directly to Pharmacy Chain 36.6.

·         Pharmstandard-Leksredstva (Kursk) confirmed EU GMP standards for syrop production line and the total amount of EU GMP production lines increased to 6 (tablets – 2 lines, capsules, aerosols, sprays, sachets).

Sales

Pharmstandard’s sales for the full year of 2009 increased by 68.1% to RUR 24,095.5 mln, which represents the increase of RUR 9,759.6 mln in comparison with RUR 14,335.9 mln reported in the full year of 2008. Pharmaceutical products and medical equipment sales contributed 97.1 % and 2.9% of total sales respectively.

The Company’s sales of pharmaceutical productsachieved RUR 23,406.8 mln for the full year of 2009 and increased by 76.5% compared to prior-year period.

The sales of OTC products (excluding 3^rd parties products) were RUR 14,840.7 mln in the year of 2009 and grew by 43.0% in comparison with prior-year period. Arbidol®, Pentalgin®, Codelac®, Complivit®, Amixin®, Flucostat® and Afobazol® generated key sales growth in OTC segment.

The Company’s revenuefrom prescription (Rx) products (excluding 3^rd parties products) amounted to RUR 2,338.1 mln and increased by 71.7% compared with the same period of 2008. The prescription products sales were driven by an increase in leading brands sales, such as Phosphogliv®, Biosulin®, Combilipen® (launched in 2008), Cyclodol®, Pikamilon® and Azitrox®.

The Company’s revenue from the 3^rd parties products amounted to RUR 6,156.4 mln and increased by 325.6% compared with the year 2008. The 3^rd parties products sales  were driven by Velcade® (Jansen-Cilag), Mildronat® (Grindex) and IRS19® and Imudon® (Solvay) products.

By Company’s view, the consumption of pharmaceutical products in Russia moved to old-fashioned and traditional drugs, because of the changes in the disposable income of population in Russia. Pharmstandard’s sales of pharmaceutical products were driven not only by top-line products but also by non-branded generics (bulk products). OTC non-branded genericssales grew by 39.5% to RUR 2,130.8 mln, Rx non-branded generics sales grew by 84.4% to RUR 315.7 mln in the year of 2009.

The Company’s revenue from its medical equipment business totaled RUR 688.7 mln for the year 2009, which represents a 36.0% decline in comparison with the same period of 2008.

Pharmstandard launched 7 new products in year 2009. New products contribution was RUR 82.6 million for year 2009.

Sales structure – full year 2008-2009, RUR mln.

Conference Call
Pharmstandard is pleased to invite the investment community to a sales results conference call with the management of the company followed by a Q&A session.

Thursday, February 11, 2010

09:00 New York

14:00 London

17:00 Moscow

To join the conference please register on-line in advance using the link below:

https://eventreg1.conferencing.com/webportal3/reg.html?Acc=916302&Conf=171353

or dial:

International Call-in Number:  +44 (0)20 7162 0025

US Toll Number : +1 334 323 6201

*We recommend that participants start dialling in 5-10 minutes prior to ensure a timely start to the conference call.

Conference call presentation will be available on February 11, 2010 on Company’s web-site:

http://www.pharmstd.ru/investors_en/investor/p2/

Pharmstandard will be represented by:

Igor Krylov, CEO

Elena Arkhangelskaya, CFO

Ilya Krylov, IR

The conference call replay will be available through February 14, 2010.
International Replay Number: +44 (0)20 7031 4064
US Toll Replay Number: +1 954 334 0342
Replay Access Code: 857924

Contacts:
JSC Pharmstandard
Ilya Krylov
Tel: +7 495 970 0030 ext 2416
E-mail: ir@pharmstd.ru
www.pharmstd.ru

***

Pharmstandard is the leading Russian pharmaceutical company. According to Pharmexpert Marketing Research Centre, it holds the top position in the domestic pharmaceutical market retail segment (preliminary data). Pharmstandard is the only Russian company among the top ten Russian pharmaceutical market operators.

Pharmstandard portfolio includes over 200 products used in the treatment of diabetes, growth hormone deficiency, cardiovascular diseases, gastroenterological and neurological disorders, infectious diseases, cancer, etc. Over 45 products by INN offered by Pharmstandard are included in the List of Vital Pharmaceutical Products.

Pharmstandard products are well known to Russian consumers. Among our market-leading brands are Arbidol ®, Complivit®, Pentalgin®, Flucostat®, Codelac®, Phosphogliv®, Amiksin® and Afobazol®. Arbidol® is the leading brand on the Russian pharmaceutical market. Its antiviral action has been studied in international research centers. Pentalgin® has been granted “BRAND #1 IN RUSSIA” award for 2008 in analgesics category. Afobazol® - new original selective anxiolytic for anxiety disorders treatment.

Pharmstandard have agreements with Grindex, Latvia on exclusive distribution and promotion of Mildronate® (cardio-vascular) and with Solvay Pharmaceuticals, France on production of IRS19® and Imudon® (immunomodulating).

In 2004–2009, we developed and introduced around 40 new pharmaceutical products. Our business priorities lie in the development of new product lines comprising genetically engineered medicines, vitamin and mineral complexes, cold relief preparations and medicines used in the treatment of cardiovascular, gastroenterological, neurological disorders and endocrinopathies. Currently, the Company is working on the development of new high-tech formulations in close cooperation with the leading Russian research centres.

Pharmstandard operates three pharmaceutical manufacturing facilities in Kursk, Ufa, Tomsk and, with a production capacity of 1.3 billion packs per year. Six production lines of JSC «Pharmstandard-Leksredstva» meet GMP requirements. JSC «Pharmstandard-Leksredstva» is the first Russian pharmaceutical plant included in EudraGMP database. All plants meet Russian legislative requirements.

In addition to its pharmaceutical business, the Company also develops, manufactures, markets and sells medical equipment, such as sterilizing and distilling machines, and disposable medical products.

The Company has invested approximately RUR 3 billion in capital investments in its manufacturing facilities since 2004. Pharmstandard placed its shares on Russian Trading System (RTS) and GDRs on London Stock Exchange (LSE) during IPO in May 4, 2007. The current GDR to ordinary share ratio is 1:4. Augment Investments Limited controls 54.2% of share capital. Free float represents 45.8% of share capital (LSE – 27.5%, RTS – 18.3%).

www.pharmstd.ru

This press release does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire securities of JSC Pharmstandard (the “Company”) or any of its subsidiaries in any jurisdiction or an inducement to enter into investment activity. No part of this press release, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever.

[1] USD figures presented for ,information purposes only. 1 USD = 30.25 RUR.