Constitutional Court decided that Ministry of Health has to create new reimbursement system until the end of 2007. The Court found the current system as defective and said the new reimbursement approval procedure should be more transparent. Drugmakers would have to provide reasons on why the proposed drug is preferable and why to include them into the reimbursement system, according the Court's guidance.
Our view: We believe more transparency and a strict cost/effect argument system should be in favor of cheaper generic producers, thus we believe Zentiva in general could benefit from the new reimbursement system. However, we do not think this news could have material impact on the share price.