President of Russia Vladimir Putin: Mr Dmitriev, the Russian Direct Investment Fund was established in 2011. Over this time, you have invested 1.9 trillion rubles in the Russian economy, including 1.7 from banks and co-investors. This is a good ratio.
I think your partners join these projects because you create favourable and stable conditions for investment as well as a good return. Their returns are higher than the average in the world, I imagine. Anyway, as we discussed at the St Petersburg Economic Forum, all of our partners in the West recognise this. Thanks to this, you have managed to create several strategic platforms together with your partners: 17 countries, I believe.
Russian Direct Investment Fund CEO Kirill Dmitriev: Yes.
Vladimir Putin: You also use Russian National Wealth Fund money, the main reservoir of our financial “safety net,” and our reserves, which are also managed very efficiently.
I would like to discuss all these things. But of course, I would like to begin with the most important thing: the fight against the coronavirus. I know you are involved in this, too. If I remember correctly, you and your partners, including the Japanese, have created very effective rapid tests.
Kirill Dmitriev: Thank you very much.
It is true that you instructed us to focus on combatting the coronavirus and allocate funding to combat the virus. Our expert assessment along with that of our partners helped us to select the best Russian and global technologies to counter the coronavirus.
The Russian Direct Investment Fund – many now refer to us as the Russian antivirus investment fund – has focused on five key spheres of activity: testing, medicines, medical services, vaccines, and accompanying online services. We have focused on these areas because we believe that they help both maintain Russians’ health and restore economic activity as soon as possible.
As for testing, we see that many countries are focused on mass testing. We have invested in the Russian-Japanese testing system and have become the first Russian private system registered in Russia.
This system is unique because it can give the same test in 30 minutes that other systems need over two hours for. This is important because we have fast results and the equipment can perform three to four times more tests. This testing system has been used by leading Russian companies and at the beginning of the epidemic it gave us an opportunity to control outbreaks at Phosagro, Sibur and other companies and to provide industrial health safety. The mobility of it allowed the Ministry of Defence to use it both in Italy and Daghestan.
The international acceptance of this system is confirmed by the fact that we have sold over 10 million test kits to other countries after satisfying Russia's needs. These countries are buying the tests because they know them to be among the best in the world.
We have also invested in another system, which provides for lung X-ray analysis and detecting the coronavirus promptly and precisely using artificial intelligence.
As for medications, as you know, at first there were absolutely no medicines to fight the coronavirus, so we focused on searching for the most effective ones that would help our doctors protect people. Together with the company ChemRar, we created a new company on a parity basis and at a record pace. This new company started producing Avifavir, a drug that inhibits virus multiplication. The Ministry of Health registered this drug last week and now it is the first registered coronavirus medicine in Russia.
Vladimir Putin: One of two medicines registered in the world.
Kirill Dmitriev: That is right, one of two registered medications in the world. It was first developed in Japan to treat the flu. ChemRar modified it a little and changed the treatment guidelines. In fact, we were the first in the world to register a drug based on Favipiravir. As you said, it has become one of two in the world. We believe this to be a very important achievement because clinical tests indicate that this medication is one of the most promising in the world. It will be sent to Russian clinics as soon as June 11 and will be available to Russians at no cost under the Obligatory Medical Insurance programme.
We are also testing this medicine for outpatient treatment. First, we will have 700,000 dose packs per year. However, higher demand – we have requests from ten other countries – will prompt us to produce up to 2 million dose packs per year.
Mr President, all of this has been made possible thanks to your support of our activities on developing medicine and of other areas, as well. To date, only Russia, China, Japan and the US are producing medicines to treat the coronavirus.
We have also established a joint enterprise with Rostech’s Nacimbio to produce virus antibodies based on blood plasma. Moreover, together with R-Pharm, we will produce a medicine to suppress the excessive response of the immune system to the virus.
Vladimir Putin: Which results in pneumonia.
Kirill Dmitriev: Yes. This means we have medicines to treat mild, medium and severe phases of the disease.
Regarding medical services, we have focused on preparing the bed inventory at private hospitals. The Mother and Child company has completely repurposed the Lapino Hospital, where Russians were treated under Compulsory Health Insurance at no cost.
Now to the vaccine, Mr President. You have said that Russia must develop and start producing a vaccine as soon as possible. Today we announce for the first time that we, Alium, jointly with Sistema Holding, and R-Pharm will invest in the production of two vaccines, along with the Gamalei Institute. We believe this vaccine has shown very promising results. Moreover, after it covers Russia’s demands, it could become a world leader among vaccines.
In terms of additional online services, we have focused on telemedicine and education. Thus, one of our companies, Doctis, showed that the number of requests for telemedicine has grown 20 times over, and the number of consulting doctors – tenfold. Today we will also announce a strategic partnership with Mail.ru to provide online medicine to 10 million Russian citizens.
Vladimir Putin: Is this your affiliate?
Kirill Dmitriev: Yes, Doctis is our affiliate [a portfolio company]. Therefore, Mail.ru will help us significantly increase our volumes.
We have also invested in Uchi.ru, an online education service that made it possible for 8 million school students to receive high-quality education in these difficult epidemiologic conditions.
In conclusion, Mr President, I would like simply to say that we will continue working with our leading international partners, as you suggested. We will continue investing in Russia’s infrastructure, in part, with our leading partners.
Last year, we invested 365 billion rubles with our partners. In the first five months of this year, we have already invested 200 billion rubles, that is, more than last year. We will continue investing, also jointly with the infrastructure fund that is being created by the Ministry of Finance, with your approval. Along with other Russian funds (these are Elbrus Capital, RTP Ventures and Baring Vostok) we allocated 15 billion for investment in medium-sized companies that were hit by the crisis. We will complete the first three deals this quarter.
Vladimir Putin: All right. But what is your general assessment of the situation in these, frankly speaking, difficult conditions of countering the infection. How are your partners responding to your proposals?
Kirill Dmitriyev: You know, to begin with, they see that Russia has taken very powerful, tough measures. And, of course, we have managed to avoid what is happening in many other countries.
Secondly, they are really seeing that the Russian market is in good shape. They have looked at the economic recovery plan. They assess it very positively and are willing to continue investing in Russia.
They are seeing that Russia is motivated for partnership. We are discussing the joint production of medications and joint efforts to produce a vaccine. This makes Russia very different from many other countries that are trying to isolate themselves and avoid partnerships. Therefore, all of our partners have noted Russia’s interest in partnerships.
Vladimir Putin: We are also succeeding in keeping macroeconomics in working order, in very good shape.
Kirill Dmitriyev: Yes, certainly, because our debt is much smaller than that of other countries. This is a good foundation. Inflation has been kept in check as well.
Vladimir Putin: Our debt and inflation are within the parameters we announced before. Unemployment figures have grown but not as dramatically as in some other countries. Therefore, our partners have every reason to continue working with the RDIF.
Kirill Dmitriyev: Undoubtedly, Mr President. We think we will be able to invest more funds than we did in the past. This is an indicator of the success of the Russian economic programme and shows what is happening in the Russian economy.
Vladimir Putin: Fine.