Indian company Aurobindo has become the latest drugmaker to forge an agreement with a Russian company in order to overcome reimbursement obstacles for imported medicines.

Aurobindo has formed a joint venture with Russia's OJSC Diod that will construct a manufacturing facility near Moscow to make prescription and over-the-counter generic medicines. Called Aurospharma, the 50:50 JV will service the pharmaceutical markets of Russia, Belarus and Kazakhstan.

In 2009, Russia's government published a concept paper in which it laid out plans to reduce the country's reliance on imported medicines. One of the measures which gave overseas drugmakers pause for thought was a clause giving preference to domestically made medicines over imports in the national reimbursement system.

While details of the plan remain sketchy, a number of drugmakers have taken the document as a prompt to start establishing domestic production capacity in Russia, and Aurobindo joins the likes of Novartis, AstraZeneca and GlaxoSmithKline in that effort.

In a statement, Aurobindo said the JV will focus on "socially significant" medicines, adding that Russia's new strategy will "make modern pharmaceuticals more affordable and accessible to the public at large" both in Russia and customs union partners.

The construction and validation of the plant is expected to complete in 2013, it said. As part of the agreement ownership of CJSC Diod's pharmaceutical ingredient manufacturing business - CJSC Olifen - will be transferred to the JV.