KYIV. May 15 (Interfax-Ukraine) - Company with foreign investment PJSC Biofarma intends to stop the production of drugs within seven days due to its inability to obtain government approval for the export of finished blood products under previously signed contracts, Biofarma Board Chairman Oleksandr Makovsky said at a press conference held at Interfax-Ukraine.

"Within seven days, I will be forced to stop production. I will be forced to dispose medicines worth $4 million, I will have to explain this to our partners who require the fulfillment of contracts and supplies being ensured under tenders they won. We will lose our reputation both as Biofarma and as [a company that represents] Ukraine. Thus, we could permanently lose these markets," he said.

According to Makovsky, this concerns contracts for the supply of blood products worth a total of $7 million to Mongolia, Vietnam, Azerbaijan, Kazakhstan, and Belarus.

"Mainly, these are public procurement contracts," he said.

Makovsky said that to make deliveries under these contracts Biofarma must obtain a special permit signed by the deputy prime minister in charge of health care.

"For these exports we have not one document issued by the Cabinet - a permit to export blood products outside Ukraine. There are technical questions over its preparation. The Health Ministry has carried out all the work required, the service of the vice premier, who oversees the Health Ministry, Viacheslav Kyrylenko, said that all the technical documents and papers are ready, but we have not had a response from there for nine months, although in the previous six years by the beginning of the year we had a permit for the current year," he said.

According to Makovsky, the penalties for failing to comply with the contracts could reach more than $1.5 million.

He said that "it is not allowed to use finished products in Ukraine because they are not registered for Ukraine." In addition, according to Makovsky, Ukraine possesses a sufficient number of blood products.

He also clarified that blood products account for about 80% of the total exports of the enterprise, while exports account for about 50% of total output.

As reported, PJSC Biofarma pharmaceutical company (Kyiv) in 2014 saw net profit fall by 9.91% compared to 2013, to UAH 25.801 million.

Biofarma is among the ten largest Ukrainian drug manufactures. Biofarma produces more than 20 immunobiological preparations of blood, as well as drugs obtained by recombinant DNA technology and probiotics.

All in all, 100% of the company's shares are owned by Niobera Investments Limited (Cyprus). The company's shares in 2012 were acquired by Dutch development bank FMO and Emerging Europe Growth Fund II (EEGF II), which is managed by Horizon Capital.

In 2014, Biofarma built a pharmaceutical factory in Bila Tserkva (Kyiv region). Investment in construction amounted to $42 million.