Amid discussions about a potential “pharmaceutical visa-free regime” between Ukraine and the EU, one of Ukraine’s key state laboratories for drug quality control is on the brink of survival. The lab’s employees have reached out to the EU Ambassador to Ukraine and are also appealing to President Zelensky for help, citing threats from the leadership of the State Service of Ukraine on Medicines and Drugs Control.
The “Pharmaceutical Visa-Free” Regime with the EU: Ukraine’s Dream Sabotaged by Officials
Following the start of official EU membership talks in December last year, Ukrainian officials have been pushing for a “pharmaceutical visa-free regime”—a plan to extend the ACAA agreement to include pharmaceuticals, allowing Ukrainian manufacturers to enter the European market. The significance of this for Ukraine is immense. According to Health Minister Viktor Liashko, it could provide a “major boost… to the economic development of the sector and the country.” Back in September 2023, Liashko’s deputy, Maryna Slobodnichenko, brought up the “pharmaceutical visa-free regime” during a trip to Brussels, suggesting that Ukraine could become a “strategic pharmaceutical hub” for the European Union.
These ambitious goals set by the ministry’s leadership stand in stark contrast to the actions of some of their subordinates, particularly officials within the State Service of Ukraine on Medicines and Drugs Control, which operates under the Ukrainian government’s oversight. Right under the watchful eyes of Minister Liashko and Ukraine’s top leadership—who are working tirelessly to integrate the country into the EU—these officials are dismantling a WHO-accredited state laboratory that ensures drug quality control. This alarming development was revealed in a letter from Natalia Ostanina, head of the laboratory at the Marzieiev Institute for Public Health, to EU Ambassador Katarína Mathernová on August 7.
Ostanina states that the leadership of the State Service of Ukraine on Medicines and Drugs Control is rejecting the services of 45 experienced scientists and specialized equipment. Instead, drug quality control is outsourced to a private laboratory, which officials are allegedly using to divert funds from the state budget.
Letter from the Head of the State Laboratory at Ukraine’s Marzieiev Institute for Public Health to EU Ambassador Katarína Mathernová
Lab Under Fire: Criminal Investigations and Sudden Inspections
On Tuesday, August 6, the State Service of Ukraine on Medicines and Drugs Control announced the suspension of certification for the state laboratory at the Marzieiev Institute. This decision was based on the results of an unplanned inspection carried out on July 18 and 19.
The timing of the inspection was suspicious. It occurred on the same day that the laboratory staff held a press conference, where they disclosed attempts by the State Service to push their institution out of the drug quality control market. Since last summer, the lab has been gradually stripped of its assignments for conducting inspections, threatening its very existence, as its activities are only partially funded by the state budget.
Lab staff emphasize that their facility has been operational since 1996 and is accredited to international ISO standards, making it the only lab in Ukraine accredited by the World Health Organization. For years, there were no complaints from authorities about the work being done. The problems began last year when 95% of the leadership at the State Service of Ukraine on Medicines and Drugs Control was replaced. In August 2023, a new private lab called LLC “Dobrobut-Likylab” suddenly emerged and, just weeks after being founded, was accredited by the State Service as an authorized facility. It quickly began receiving most of the drug testing assignments. Pharmaceutical companies, under threat of being pushed out of the market, are now forced to contract with this new lab, despite serious concerns about its competence. Previously, labs had to operate for several years to qualify for drug quality control authorization, but now, thanks to changes by the State Service, the bar has been drastically lowered, according to experts.
“This is a major risk for the public because some drugs might have undergone only superficial checks, received a quality certificate, and ended up on pharmacy shelves. As a pharmacist, how can we not trust a document that says ‘quality certificate,’ issued by the State Service after sending the drugs to one lab or another?” questions Oleh Klimov, a member of the Council of the International Pharmaceutical Federation (FIP) and the American Pharmaceutical Association (APhA).
Meanwhile, the Marzieiev Institute is facing increasing pressure from law enforcement. On September 29 of last year, criminal charges were brought against the lab’s staff. In June, the lab was raided, and the chemists’ work logs and other documents, including the Institute’s charter, were seized. The scientists are dealing with threats and intimidation from representatives of the State Service of Ukraine on Medicines and Drugs Control. On July 31, the state laboratory sought protection from Ukrainian President Volodymyr Zelensky, Prime Minister Denys Shmyhal, and the heads of the Security Service of Ukraine and the Ministry of Health for protection.
A Close-Knit Circle: Corruption in Ukrainian Pharmaceuticals?
According to the Ukrainian Unified State Register of Legal Entities, LLC “Dobrobut-Likylab” was registered on April 11, 2023. One of its founders, Dmytro Ustik, previously ran a construction business. The lab is now managed by Ihor Lesyk, who, according to his electronic declaration, is married to Olena Verezhnikova, the head of the State Drug Quality Control Department at the State Service of Ukraine on Medicines and Drugs Control.
Meanwhile, Ukrainian media have reported other instances of potential corruption within the leadership of the State Service, particularly involving its head, Roman Isaienko. Attention has been drawn to the fact that, upon assuming leadership of the agency, Isaienko appointed his close friend, Volodymyr Korolenko, as his deputy. Another friend, Maksym Volodiy, was appointed director of the state enterprise “Ukrainian Pharmaceutical Quality Institute.” The close ties between Isaienko, Korolenko, and Volodiy are evidenced by their joint founding of the public organization “Kyiv Club” in 2014, as documented in the Unified State Register. Journalists from the Ukrainian outlet “ORD” claim that the leadership of the State Service has been involved in schemes to extort bribes from drug manufacturers in Europe and Asia, as well as creating artificial obstacles to keep high-quality medications out of the Ukrainian market.
Isaienko has led the State Service since 2019, and in March of this year, the Ukrainian Cabinet of Ministers reappointed him.
Roman Isaienko, Head of the State Service of Ukraine on Medicines and Drugs Control
Allegedly, Isaienko’s accomplice in these illegal activities is Valentyn Ovramets, an officer of the Security Service of Ukraine (SBU), specifically within the controversial Main Directorate for Counterintelligence Protection of Critical Infrastructure and Counter-Terrorism Financing. This department was formerly headed by Artem Shylo, who was exposed by Ukrainian law enforcement in April this year for organizing the purchase of transformers for the national rail carrier “Ukrzaliznytsia” at inflated prices. Ovramets is also reported to be a close friend of Isaienko. His wife, Yuliia Ovramets, was the owner of the pharmaceutical company “Vayum-Pharm” until early 2023.
“Problem with Ukraine’s Image”
The pharmaceutical scandal could have serious consequences for both ordinary Ukrainians and businesses—domestic and foreign—that supply medical products to Ukraine. Experts are warning that this situation could severely damage trust in the country’s drug quality control system.
“This is a problem with Ukraine’s image. We’re talking about one of the few laboratories in the country accredited by the World Health Organization. For any country, having such a lab is a benchmark, a sign of rigorous drug market standards,” says Oleh Klimov, a member of the Council of the International Pharmaceutical Federation (FIP) and the American Pharmaceutical Association (APhA). “The first and most immediate impact will be on the medicines produced in Ukraine and exported abroad—to more than 86 countries.”
The irresponsible actions of the leadership at the State Service of Ukraine on Medicines and Drugs Control are putting not just the potential “pharmaceutical visa-free regime” with the EU at risk, but also the broader negotiations on Ukraine’s EU membership. These talks, among other aspects, include the integration of Ukraine’s national drug quality assessment system into the wider European framework. The situation demands urgent attention from the European Commission and relevant EU agencies.