Russia is currently facing unprecedented sanctions. Restrictions have been imposed not only at the state level: many businesses and foreign brands have suspended operations in Russia. The withdrawal of foreign goods and technologies from the Russian market will undoubtedly affect the life of many Russian citizens and will have the strongest negative impact on the most vulnerable groups such as people with disabilities. Yegor Knyazev, head of the business planning department at Istok-Audio, told Invest Foresight about what problems people with a hearing loss might face and what strategies there are to substitute foreign assistive hearing devices.
Istok-Audio is one of the companies that have been implementing the import substitution program by the Russian Ministry of Industry and Trade. The company is located in the Fryazino science town outside Moscow and for 27 years has developed, produced and provided hearing impaired people with cutting-edge rehabilitation devices such as hearing aids, assistive listening devices and others. Istok-Audio has an advanced R&D and manufacturing complex and is a resident company of the Istok special economic zone for technology and innovations.
— What problems people with impaired hearing might face due to the newly imposed sanctions against Russia?
— In Russia, there are some 12-14 million of hearing impaired people. Some five million of them need hearing aids. The share of imports of assistive hearing devices on the Russian market is around 50%. The largest global manufacturers of hearing aids are companies from the European Union: Denmark, Germany and Switzerland. In the new reality, there are two crucial issues that people with a hearing impairment might face. The first one is a shortage of hearing aids or their limited variety. There are signs that European manufacturers might suspend or completely stop the deliveries of their products to Russia, and the range of accessible hearing aids will decrease significantly.
The second issue is the overall price hike for customers. There is a risk that they will be forced to opt for simpler and less quality products.
— Does Istok-Audio have a solution to these problems?
— Our priority is to prevent the situation when the hearing impaired in Russia are left without hearing aids and their quality of live decreases. For the past few years, Istok-Audio has worked on the implementation of a range of import substitution projects. Being a company with a solid science and technology infrastructure, we have managed to create an entire variety of hearing aids that are highly competitive with the foreign ones. A family of high-tech digital hearing aids for those requiring hearing care is currently entering the market. These products were developed by Istok-Audio engineers and are based on our newest computational platform with algorithms that assess the acoustic environment and help people hear. The newly developed hearing aids are tiny and powerful digital devices to address type of hearing loss and provide users with natural sound in different acoustic environments. Without bragging, we can say that this particular series of hearing aids is a technological breakthrough in the Russian market of hearing enhancement devices on par with the best foreign counterparts in terms of its characteristics and capabilities.
— What measures is the government taking to continue providing people with hearing loss with high-quality hearing aids?
— Manufacturers of technical rehabilitation devices and customers – Russia’s Ministry of Labor and Social Protection and Russia’s Social Insurance Fund – are currently taking comprehensive joint efforts. The work includes revising the conditions for concluding government contracts to purchase hearing aids. As we know, these devices are free medical products provided to Russian citizens that suffer from a disability. The government’s social obligations remain in force, yet the conditions for concluding contracts need to be reviewed; this applies both to prices of purchased technical equipment used for rehabilitation as well as to delivery conditions. I am certain that these tasks will be solved, and the government will continue to provide high-tech digital hearing aids to citizens with hearing impairments. Istok-Audio has every opportunity to continue offering high-level technical rehabilitation equipment to people with hearing impairments at an affordable price.
— What other products manufactured by Istok-Audio could fill the niche following the exit of foreign companies from the Russian market?
— We are developing plenty of innovative devices, such as digital vibration and light based systems, which persons with a hearing loss can receive free of charge through the Social Insurance Fund. This is our exclusive development, which utilizes unique signal transmission technologies that exclude false alarms. A multipurpose digital vibration and light based system is a smart home system that comprises many components; it makes lives of those with disabilities and the elderly as comfortable and safe as possible, solves many tasks without assistants’ help, such as the tasks of ventilating rooms, controlling lighting and managing indoor or outdoor phone calls, and helps users monitor indoor devices. A smart home is controlled through a special mobile application which can be used by those with visual impairments as well.
Another socially significant device is an FM system, a niche product designed for hearing and speech rehabilitation, including for children with a hearing loss. In the current conditions, with foreign manufacturers most likely to withdraw equivalent products from the Russian market, the FM system will help to satisfy needs of many rehabilitation institutions and centers. We are currently taking efforts to extensively test the product among users with hearing impairments, and then we will begin distributing it widely in the domestic market.
I would like to particularly mention the Otoprom company, which is part of Istok-Audio Group. This venture is Russia’s only localized production facility that manufactures sound processors for cochlear implant systems, which has been certified to meet international standards for quality and safety of medical devices. A cochlear implant uses a unique technology that helps to restore hearing in children and adults with total hearing loss. The launch of the production facility in Fryazino was an immensely significant event. Regrettably, imposed sanctions have enormously affected Otoprom as a localized production. But hopefully, we will be able to overcome this situation, preserve this socially significant project, and continue manufacturing sound processors.
— Could sanctions serve as a growth driver for manufacturers based in the Moscow region? Will we be able to grow stronger following the sanctions?
— I would like to address this question differently. Under the sanctions, we must fulfill our social obligations to people with disabilities, and make every effort to provide Russian citizens with required technical devices for rehabilitation. We deem it important to ensure a better quality of life for people with disabilities in our country despite any circumstances. I am certain that we will solve this issue and Istok-Audio Group will retain its position as a strong and socially relevant business.