The Essence of the Reform: Merger and Corporatization
According to the decree, the process of forming the new holding will take place in several stages and will involve leading state-owned enterprises in the industry:
- In the first stage, the federal state-owned enterprise (FCP) “Shchelkovsky Biocombine”, located in the Moscow region, will be renamed to FCP “Russian Biological Industrial Company”.
- Subsequently, four more major regional players will be merged into it: “Armavirskaya Biological Factory” (Krasnodar Territory), “Kurskaya Biofactory — Firm ‘BIOK'”, “Orlovskaya Biofactory”, and “Stavropolskaya Biofactory”. The Russian Government has been given 18 months to implement this task.
- In the final stage, within the following 18 months, the combined structure will be transformed into a joint-stock company, “Scientific and Production Association ‘Russian Biological Industrial Company'”.
However, privatization in the traditional sense is not planned: 100% of the shares of the newly created joint-stock company will remain in federal ownership. The new enterprise will also be exempt from the standard provisions of the state privatization program.
Strategic Goals and Priorities of the New NPO
The main goal of creating a unified JSC is to stimulate investment activity and improve the efficiency of state property management.
The decree strictly establishes the priority areas of the association’s work:
- Production of medicines and preparations for conducting crucial anti-epizootic measures that are within the sphere of Russia’s national interests and ensure national security.
- Manufacturing a wide range of pharmaceutical products, preparations, and materials for veterinary use.
- Conducting research and development (R&D) in the fields of veterinary medicine, medicine, and biotechnology, as well as developing and introducing new biological preparations into production.
Due to the exceptional importance of the new holding, the Russian Government has been tasked with adding the company to the official list of strategic enterprises and strategic joint-stock companies within six months after its state registration. The decree enters into force on the day of its signing.
