A South Korean pharmaceutical company manufacturing Russia’s COVID-19 vaccine says it's bracing for business complications as the U.S.-led West escalates sanctions against Russia over the invasion of Ukraine.

Recently expanded U.S. sanctions include targeted measures against the Russian Direct Investment Fund, a sovereign wealth fund run by a close ally of President Vladimir Putin that globally markets the Sputnik vaccines.

Read:Ukrainian passport holders can seek UAE visas

Kim Gi-young, an official from Seoul-based GL Rapha, said the sanctions won’t directly impede its production of the shots as the measures aren’t aimed at essential medical supplies.

However, the company is concerned about potential problems rising from the financial side as South Korea joins the United States and many European countries in a move to cut off key Russian banks from global payment systems.

“Right now, we are watching how the situation develops,” Kim said.

GL Rapha has so far produced 5 million shots of the single-dose Sputnik Light vaccine, but none of them have been used so far as Russia continues to delay rollout plans, Kim said.

Read:Indian students in Ukraine in fear as Russian invasion grows

GL Rapha also has an agreement with RDIF to produce 150 million shots of the two-dose Sputnik V and is participating in a consortium of South Korean companies that has been contracted to produce another 500 million doses of Sputnik V, but these shots haven’t been produced yet.

RDIF has reportedly criticized the U.S. sanctions and said the measures would slow its promotion of Sputnik V.