OREANDA-NEWS. February 04, 2010. The Russian goverment is to cap prescription drug prices starting 1 April 2010. The new law is aimed at regulating drug retail prices by limiting the amount of retail mark-up, reported the press-centre of OTKRITIE Financial Corporation.

View: We see the news as neutral for Pharmstandard and Veropharm.

Valuation and Action: Veropharm is currently trading on a 2010 EV/EBITDA of 4.9x, which implies a 65% discount to EM peers. The stock is unlikely to react to the news, due to its deep discount to peers. Pharmstandard  is currently trading on a 2010 EV/EBITDA of 9.6x, which is a 33% discount to EM peers.