Nikolay Hadzhidonchev: The Generic Sector in the Era of Innovation – Human Leadership and Real Challenges

Nikolay Hadzhidonchev is a manager with over 30 years of leadership experience in international companies within the FMCG and pharmaceutical sectors. He currently holds the position of General Manager of Teva for Bulgaria and Greece.

He joined Teva Pharmaceuticals in 2011 as General Manager of Teva Pharmaceuticals Bulgaria. Following Teva’s acquisition of Actavis in 2016, he took over the leadership of the company’s commercial division in Bulgaria – Teva Pharma. Since the beginning of 2023, he has also been responsible for managing Teva’s commercial operations in Greece.

Prior to this, he held senior management positions at Alapis Bulgaria (2009–2011), Actavis EAD (2006–2009), Roche Bulgaria (2002–2006), and Unilever Bulgaria (1998–2002).

Nikolay Hadzhidonchev is the Chairman of the Board of the Bulgarian Generic Pharmaceutical Association (BGPharmA), and since 2022, a member of the Board of the Confederation of Employers and Industrialists in Bulgaria (KRIB) and Chairman of the Healthcare Committee at KRIB.

I. LEADERSHIP, RESPONSIBILITY, AND STRATEGIC HORIZONS

Your professional path combines two major responsibilities – Chairman of the Board of BGPharmA and General Manager of a large international pharmaceutical company. How do you balance these roles, where do they intersect, and where are the boundaries most delicate?

Nikolay Hadzhidonchev: The intersection lies in the fact that ethical principles and balance are the foundation for both, and that is where the differences begin. In the corporate world, we talk about plans, strategies, profit, and – I would emphasize – first and foremost, people and the team. However, when it comes to the Bulgarian Generic Pharmaceutical Association (BGPharmA), the focus shifts toward regulations, long-term horizons, policies, sustainability, and external factors.

Both responsibilities and organizations are interconnected. Corporate business depends on the horizons, policies, and regulatory sustainability of a country, and their intersection is key to maintaining balance. Therefore, it is important that one of my roles never outweighs the other. If I were to try to protect a purely corporate interest while pushing a policy, that would be a violation of ethical standards.

Everything must be based on ethical principles and clear rules. The focus of one activity is one thing, and the other is quite different, yet they are extremely connected. The boundaries become thinnest when you have to ensure that one position does not influence the other. This is exceptionally difficult. But I have succeeded – for 13 years now.

TEVA is a global company, and you are responsible for the markets in Bulgaria and Greece. What are the main similarities and differences between the two markets that most strongly influence your strategies and regional business decisions?

Nikolay Hadzhidonchev: One of the main similarities between the Bulgarian and Greek markets is that both are relatively small in the context of the European Union, especially compared to the “Big Five” – Germany, France, Italy, Spain, and Poland. However, the differences are significantly more numerous and substantial.

Following the financial crisis in 2011, Greece was forced to carry out a series of structural reforms in all areas, including healthcare and, logically, drug supply. In Bulgaria, this process is much more unstable, occurring more in fits and starts, and there is still a lack of a long-term strategy regarding regulation – at least, unfortunately, I have not seen one.

To illustrate with a specific example: when we talk about a generic crisis, we must note that in Greece, our company focuses more on innovative therapies, as our structure is hybrid. Nevertheless, in Greece, the share allocated to generic medicines as a percentage of public funds is one of the lowest in the EU – around 21%. In Bulgaria, it is only 7%. This difference clearly demonstrates the need for change – and such changes will certainly happen.

One of our successful attempts, realized through cooperation with the Association of Research-Based Pharmaceutical Manufacturers in Bulgaria (ARPharM), was convincing the authorities that generic and biosimilar products should have a separate budget within the “medicines” section. I hope that after the next budget change for 2026, this will not change and will come into force. Otherwise, what happens: in recent years, a number of generic medications have been withdrawn from the market because they become unprofitable. This is the key difference between Greece and Bulgaria – a mass withdrawal of medications in Bulgaria, while in Greece, the system is more stable.

The reasons for this are complex. Price competition is extremely intense: first, we must offer the lowest price, then we must fight the competition. After the COVID-19 pandemic, production costs increased manifold – not only because of energy prices and the war in Ukraine but also because the global pharmaceutical industry shifted the production of active substances for many critical medications to India and China. This led to the monopolization of some key molecules, allowing manufacturers to set the price. During and after COVID, some molecules increased in price by up to 600%. At the same time, overhead and labor costs also rose, while the price of medications remains fixed. We must also not forget the additional financial burdens, unbearable for generic manufacturers, related to the NHIF Cost Sustainability Mechanism. Thus, at some point, profit is wiped out and the medication becomes unprofitable – it is withdrawn first from reimbursement, and often from the market. These challenges are particularly acute for small markets like Bulgaria.

Another key aspect in which the markets in Bulgaria and Greece differ is the structure and concentration in retail trade here. We are among the top 10, if not the top 5, in Europe by this indicator, while in Greece, there is no such concentration. To illustrate: in Bulgaria, I work with 10 wholesalers, while in Greece, given the market distribution, I interact with 112 out of a total of 300. The number of pharmacies is also different: Greece has about 11,000 pharmacies, while Bulgaria has just over 3,000.

These examples highlight how much more complex and multifaceted the picture is for small markets in Europe. Ultimately, there are more differences between the markets than similarities, and stability, structural reforms, and clearly defined budgets are key to the long-term sustainability of the system.

How is the strategic role of the company’s Bulgarian production and operational units evolving in the context of European supply chains and the growing need for regional autonomy?

Nikolay Hadzhidonchev: Not only European but also global chains are served by our production facilities in Bulgaria. Teva has two plants in our country – in Dupnitsa and Troyan – which are part of the company’s global manufacturing network. The products manufactured there are exported to over 70 countries.

The plant in Dupnitsa is the first pharmaceutical plant in Bulgaria and ranks among the leaders in our group for tablet and capsule solid forms. It is key not only because of the large volume of production but also because a huge portion of the output is exported to Europe and the USA. A significant advantage is that the plant meets all European and American standards and has been audited three times by the US Food and Drug Administration (FDA) without a single observation. Last year, a new tablet facility was launched there, which ranks among the most modern in Europe.

After COVID-19, a serious problem with drug supply emerged in Europe, caused by price restrictions and limitations in other markets around the world. Optimizing supply chains became extremely important to ensure there are no interruptions and that patients have access to necessary treatment. In this context, the Dupnitsa plant has established itself as a key part of the company’s European logistics system.

The Troyan plant specializes in the production of liquid and semi-liquid forms – suspensions, syrups, gels, ointments, creams, etc. Particularly interesting is the fact that two years ago, the global production of our product Sudocrem was moved there, and now Troyan exports to the entire world.

Research and development and global partnerships are opening new horizons for the pharma industry. Where do you see Bulgaria’s greatest potential?

Nikolay Hadzhidonchev: We are extremely competitive, and the very fact that investments are being made here is indicative of Bulgaria’s potential. To give another perspective – in the office where we are located, besides the commercial organization on this floor, there are four more floors occupied by about 500 Teva employees with global and regional functions.

Bulgaria is attractive mainly because of its cost-effectiveness and high human capacity. We have exceptionally good chemists and pharmaceutical specialists, which is particularly important for generic production. However, when it comes to innovative products, the situation is different.

One of our key advantages is precisely the quality of the workforce. About 10% of all professional staff engaged in generic production in Europe are employed in Bulgaria – a percentage that is hard to find in any other sector. In this context, our country has enormous potential for both production facilities and clinical trials.

We have good medical specialists who can participate in research projects; we have the capacity for structuring processes and for IT support, which allows for conducting clinical trials from Phase II to Phase IV. When it comes to global clinical trials in the company I lead, Bulgaria is always on the map.

This, combined with highly qualified personnel and a competitive environment, makes our country an attractive destination for both manufacturing and research and development.

Artificial intelligence is already changing the way clinical research is conducted, data is analyzed, and supply chains are planned. Where do you see the greatest potential for AI?

Nikolay Hadzhidonchev: Artificial intelligence cannot function independently – the human factor is necessary. That is precisely why I am an optimist. This is the future, and this is exactly where Bulgaria can provide its added value in our sector. We have highly qualified experts with significant potential who can engage in these processes in a way that competes with leading European markets.

I believe that Bulgaria will gradually become a magnet for talent and that many Bulgarians currently working abroad will start to return. The truth is that Europe’s economy is no longer what it used to be. If our country plays its cards right, we have every chance to become an even more attractive destination – not only for investment but also for highly qualified personnel to drive the sector forward.

II. MEDICINES POLICY, ACCESS AND EUROPEAN FRAMEWORKS

There is much talk about reforms, but few healthcare systems actually change. What is hindering the development of the pharma sector here, and who should take political responsibility?

Nikolay Hadzhidonchev: The first and biggest problem is that we are still working piecemeal. We continue to “fill holes,” reacting to crisis situations often provoked by external factors, instead of acting proactively. A clear example of this was COVID – we all suddenly realized that we have a serious problem with access to active substances. And this applies not only to Bulgaria but to Europe as a whole, because we are part of a single market. Europe suffers from a lack of its own production of active substances, and sometimes its policies become an obstacle to overcoming this shortage.

The primary goal must be to ensure timely and continuous access to therapies for patients in Bulgaria and the EU. Unfortunately, we lack a clear vision, a long-term strategy, a working plan, and people to consistently implement them. Political instability leaves its mark and hinders the sustainable development of the healthcare system.

For more than 13 years, there has been talk of a pro-generic policy in Bulgaria, but the reality is different – a share of only 7% of public funds. At the same time, global trends, including policies initiated by President Trump’s administration, carry a real risk that pharmaceutical innovation will concentrate in the USA. If Europe and Bulgaria do not react in time, this would lead to significant changes and potentially limited access for Bulgarian patients to modern therapies.

We must start thinking ahead: how to ensure that Bulgarian citizens will have access to treatment, live normally, and be fit for work. Solutions exist, but most of them are politically conditioned because, at their core, it is a matter of funding. The healthcare budget in Bulgaria has increased significantly in recent years, but the feeling is not one of better results. And yet, we should not deny the advantages of the system – we have some of the best access to medical specialists in Europe.

It is necessary for all participants in the sector to work together. Digitalization of processes can optimize activities, save resources, and improve transparency. The problem is that there is often a lack of sufficient will and consistency – many projects start at the end of someone’s mandate, after which they are terminated despite significant funds having been invested.

For me, one of the most important things is auditing. In our country, it is often missing or reduced to a check only “at the entrance.” We cannot have a program and not exercise control over the work done at every stage. Auditing is the tool that ensures efficiency, transparency, and real results.

Unpopular decisions must be made; it is not easy. You must have the strength and be ready to “fall victim” and leave something behind.

If you had to point to one systemic mechanism in Bulgarian medicines policy that functions in such a way that even good decisions become ineffective – what would it be?

Nikolay Hadzhidonchev: It is crucial for generic and biosimilar products to have a separate budget within the “medicines” line item. This is the first and most important step. It would guarantee the sustainable presence of these therapies on the market and, at the same time, would encourage the state to gradually adjust the proportion – from the current 7% to 10%, then 15%, and step-by-step until reaching average European levels.

Funds in the system will never be sufficient, and the main challenge ahead is the deepening deficit in the NHIF budget. Payments are being delayed, and next year the deficit will be even larger. The problem is systemic – revenues are decreasing. In this context, increasing the health insurance contribution is an inevitable measure. Unfortunately, however, it is unlikely that anyone will take the political risk of making such a decision in the foreseeable future.

The introduction of the euro – do you expect disruptions for the Bulgarian market?

Nikolay Hadzhidonchev: I sincerely hope that there will be no disruptions. In the company I lead, we have taken all necessary measures to avoid such situations. In my conversations with wholesalers, I understand that they have also taken steps to prepare. Nevertheless, I cannot give an absolute guarantee. The truth is that if we look at the experience of other countries, there were disruptions there – in some cases more serious, in others in a milder form.

What I can say for sure is that we are doing everything possible. We drew valuable experience from Croatia and started preparations significantly earlier. We built teams at both the European and national levels that work in a coordinated manner. A six-month grace period is also planned to ensure a smooth transition and minimize possible difficulties.

III. HUMAN RESOURCES, SECTOR CAPACITY, AND A CULTURE OF SUSTAINABILITY

Against the backdrop of global transformations – geopolitical tensions, changes in scientific models, new technologies – what defines a sustainable pharmaceutical leader today?

Nikolay Hadzhidonchev: Strong ethical principles and people – these two elements go hand in hand and come first. To them, we must also add the desire for change, especially in today’s extremely dynamic world where the pace is constantly accelerating, including due to the advent of artificial intelligence.

However, it is important to make one qualification here. Sometimes we have a tendency to delude ourselves that AI is a panacea that will abruptly change everything and displace the human factor. This is not entirely true. Technology cannot replace humans and their contribution. People remain at the core.

Therefore, it is important to model our expectations realistically and not rely excessively on artificial intelligence. Otherwise, we risk waking up one day unprepared for what follows – because we have neglected the human element and expected technology to be a universal solution.

You often speak about change management. How do you create such an organizational culture and team?

Nikolay Hadzhidonchev: I feel truly blessed. I work with wonderful people – both in Bulgaria and in Greece. People who grew up alongside me, and many of whom have surpassed me. They are exceptional professionals in their field, much greater than I myself could ever be. And so I say again – I am blessed and happy to have the privilege of working with such people. Without them, I am nothing.

If we were to return to this conversation in a decade – what would you like to be the most significant thing the Bulgarian pharmaceutical industry has achieved by then?

Nikolay Hadzhidonchev: We said earlier that the potential is enormous. If we manage to combine our strengths with the efforts of the people who make key decisions – those who must encourage the next generation of engineers, chemists, doctors, and nurses – and if we move invariably toward the implementation of AI, digitalization of processes, and working with Big Data, then we can achieve a lot.

If we sit down at one table and draw up a long-term plan – even if we do not subsequently implement it fully – Bulgaria has every chance to become a leading factor not only in Europe but in the whole world regarding clinical trials and the production of generic medications.

What things in your life today make you set new boundaries for your time, and what brings you the greatest joy outside of work?

Nikolay Hadzhidonchev: Besides my work, I have a passion that has accompanied me for 15 years – underwater photography. It brings me not only joy but also immense peace. I constantly strive to become better at what I do. Friends and acquaintances often urge me to hold an exhibition, but I always demand more of myself. Surely that will happen one day too. For me, diving and photography are an immersion into another reality – there are no emails, no phone calls. It is like venting, but also much more.

Deep waters have always been equally comfortable for me, regardless of the conditions.

The greatest joy, however, comes from my grandchildren. I have a granddaughter aged 6 and a grandson aged 1. First was Nika, my granddaughter, who is my great weakness. When she was 4, the three of us – she, her grandmother, and I – were supposed to travel to Mauritius. But at the last moment, her grandmother found she couldn’t travel, so the two of us went for 10 days. Our bond is exceptionally strong. To this day, she is with me almost every weekend – I cannot imagine life without her. When my children were born, I was extremely busy – building a career, working a lot – and now I am catching up. The difference is that now everything is pleasure and happiness, and the major responsibility lies with her parents.

And when we talk about boundaries… here it is: I have promised my grandchildren that I will work until December 19th and after that “I’m gone.”