ECONOMY

In Brief

Greek drug makers caution of dire effects of gov’t measures Greek pharmaceutical companies fear strong measures from the Development Ministry may have «disastrous effects on the market and open a new front,» representatives of the industry said. While their dialogue with the government continues, drug makers expect measures to include a 20 percent price drop in original medicines after their patent expires, an 8.5 percent profit ceiling on local original research products, price fluctuations (up to 12 percent) depending on packaging, and 5 percent of each firm’s turnover to go to social security funds. Industrialists say «cheap medicines will disappear, replaced by expensive imported ones from multinational companies, shrinking the domestic industry further.» Terna wins tender for Bulgarian high-speed rail SOFIA (Reuters) – Greek construction company Terna has won a tender to build the first stretch of a 340-million-euro high-speed railway, Bulgaria’s Transport Ministry said yesterday. Bulgaria received the backing of the European Commission to seal a deal with Terna to construct a 38km (24-mile) stretch of the 151km railway, which will link the Balkan state with its southern neighbors, Greece and Turkey. Terna won the international tender over eight other competitors with a bid of 85.7 million euros for the project, which will allow trains to travel up to 160km per hour. The project will be financed by a 153-million-euro grant by the EU preaccession fund ISPA, a 150-million-euro loan by the European Investment Bank and 37 million euros from the state budget. The Transport Ministry has said it will open a tender for the second 111km stretch of the high-speed railway after it closes the deal for the first. The railway is expected to go into operation in 2011. Alpha Bank The application of international financial reporting standards is estimated to result in a reduction of Alpha Bank’s equity capital by 500 million euros, investment bank Citigroup Smith Barney said in a research paper. It raised the target price for Alpha from 26 to 28 euros, retaining unchanged its buy/medium-risk recommendation. The report also cites senior Alpha officials as saying that the bank would be interested in bidding for Emporiki Bank if France’s Credit Agricole did not exercise its right of first refusal. Piraeus Real Estate The initial public offering of Piraeus Real Estate Investment, the first closed-end fund of its type to be listed on the Athens Stock Exchange, was oversubscribed 2.8 times. The 12.47 million shares will be offered at the price of 2.12 euros and shareholders will receive a dividend for fiscal 2004. Kontominas Kontominas, the insurance magnate who presided over the transfer of Interamerican, Greece’s biggest insurance company, to the international Eureko group, is said to be making a comeback in the Greek market with an insurance brokerage company, Best Line. Eureko is said to hold an interest in the new company.