OLEG glances furtively around him and, confident that nobody is watching, slips inside the entrance to a decaying Soviet-era block of flats, where Sasha is waiting for him.

Ensconced in the dingy kitchen of one of the apartments, they empty the contents of a carrier bag that Oleg has brought - painkillers, iodine, lighter fluid, industrial cleaning oil and an array of vials, syringes and cooking implements.

Half an hour later, after much boiling, distilling, mixing and shaking, what remains is a caramel-coloured gunge in the end of a syringe, and the acrid smell of burnt iodine in the air. Sasha fixes a dirty needle to the syringe and looks for a vein in his bruised forearm. He hands the syringe to Oleg, telling him to inject the fluid. He closes his eyes and takes the hit.

Russia has more heroin-users than any other country in the world - up to two million, according to unofficial estimates. For most, their lot is a life of crime, stints in prison, probable contraction of HIV and hepatitis C, and an early death. As efforts to stem the flow of Afghan heroin into Russia bring limited success and the street price of the drug goes up, for those addicts who can't afford their next hit, an even more terrifying spectre has raised its head.

The home-made drug that Oleg and Sasha inject is known as krokodil, or "crocodile". It is desomorphine, a synthetic opiate many times more powerful than heroin that is created from a complex chain of mixing and chemical reactions, which the addicts perform from memory several times a day.

While heroin costs from £20 to £60 ($39-$118) per dose, desomorphine can be "cooked" from codeine-based headache pills that cost £2 per pack, and other household ingredients available cheaply from the markets.

It is a drug for the poor, and its effects are horrific. It was given its reptilian name because its poisonous ingredients quickly turn the skin scaly. Worse follows. Oleg and Sasha have not been using for long, but Oleg has rotting sores on the back of his neck.

"If you miss the vein, that's an abscess straight away," says Sasha. One of their friends, in a neighbouring apartment block, is further down the line. "She won't go to hospital, she just keeps injecting. Her flesh is falling off and she can hardly move any more," says Sasha.

Photographs of late-stage krokodil addicts are disturbing in the extreme. Flesh goes grey and peels away to leave bones exposed. People literally rot to death.

Russian heroin addicts first discovered how to make krokodil around four years ago, and there has been a steady rise in consumption, with a sudden peak in recent months.

"Over the past five years, sales of codeine-based tablets have grown by dozens of times," says Viktor Ivanov, the head of Russia's Drug Control Agency. "It's pretty obvious that it's not because everyone has suddenly developed headaches."

Heroin addiction kills 30,000 people per year in Russia - a third of global deaths from the drug - but now there is the added problem of krokodil. Ivanov recalled a recent visit to a drug-treatment centre in Western Siberia. "They told me that two years ago almost all their drug-users used heroin," he said. "Now, more than half of them are on desomorphine."

He estimates that overall, around 5 per cent of Russian drug-users are on krokodil and other home-made drugs, which works out at about 100,000 people. It's a huge, hidden epidemic - worse in the really isolated parts of Russia where supplies of heroin are patchy - but palpable even in cities such as Tver.

It has a population of half a million, and is a couple of hours by train from Moscow, en route to St Petersburg. Its city centre, beside the River Volga, is lined with pretty, Tsarist-era buildings, but the suburbs are miserable. People sit on cracked wooden benches in a weed-infested "park", gulping cans of Jaguar, an alcoholic energy drink. In the background are rows of crumbling apartment blocks. The shops and restaurants of Moscow are a world away; for a treat, people take the bus to McDonald's.

In the city's main drug treatment centre, Artyom Yegorov talks of the devastation that krokodil is causing. "Desomorphine causes the strongest levels of addiction, and is the hardest to cure," says the young doctor, sitting in a scruffy treatment room.

"With heroin withdrawal, the main symptoms last for five to 10 days. After that there is still a big danger of relapse, but the physical pain will be gone. With krokodil, the pain can last up to a month, and it's unbearable. They have to be injected with extremely strong tranquilisers just to keep them from passing out from the pain."

Yegorov says krokodil-users are instantly identifiable because of their smell. "It's that smell of iodine that infuses all their clothes," he says. "There's no way to wash it out, all you can do is burn the clothes. Any flat that has been used as a krokodil cooking house is best forgotten about as a place to live. You'll never get that smell out of the flat."

Addicts in Tver say they never have any problems buying the key ingredient for krokodil - codeine pills, which are sold without prescription. "Once I was trying to buy four packs, and the woman told me they could only sell two to any one person," recalls one, with a laugh. "So I bought two packs, then came back five minutes later and bought another two."

The solution to many is obvious: ban the sale of codeine tablets, or at least make them prescription-only. But despite the authorities being aware of the problem for well over a year, nothing has been done.

Last month, a spokesman for the Ministry of Health said that there were plans to make codeine-based tablets available only on prescription, but that it was impossible to introduce the measure quickly. Opponents claim lobbying by pharmaceutical companies has stalled action.

"These tablets don't cost much, but the profit margins are high," says Ivanov. "Some pharmacies make up to 25 per cent of their profits from the sale of these tablets. It's not in the interests of pharmaceutical companies or pharmacies themselves to stop this, so the government needs to use its power to regulate their sale."

In addition to krokodil, there are reports of drug-users injecting other artificial mixes, and the latest street drug is tropicamide. It is used as eye drops by ophthalmologists to dilate the pupils during eye examinations.

Yegorov says patients have no trouble getting hold of capsules of it for about £2 per vial. Injected, the drug has severe psychiatric effects and brings on suicidal feelings.

"Addicts are being sold drugs by normal Russian women working in pharmacies, who know exactly what they'll be used for," said Yevgeny Roizman, an anti-drugs activist who was one of the first to talk publicly about the krokodil issue earlier this year. "Selling them to boys the same age as their own sons. Russians are killing Russians."

Zhenya, quietly spoken and wearing dark glasses, agrees to tell his story while I sit in his car in a lay-by on the outskirts of Tver. He managed to kick the habit after spending weeks at a detox clinic, experiencing horrendous withdrawal symptoms that included seizures, a 40-degree temperature and vomiting. He lost 14 teeth after his gums rotted away, and contracted hepatitis C. But his fate is essentially a miraculous escape - after all, he's still alive. Zhenya is from a town outside Tver, and was a heroin addict for a decade before he moved on to krokodil a year ago. Of the 10 friends he started injecting heroin with a decade ago, seven are dead.

Zhenya says every addict he knows in his town has moved from heroin to krokodil, because it's cheaper and easier to get hold of.

"You can feel how disgusting it is when you're doing it," he says. "You're dreaming of heroin, of something that feels clean and not like poison. But you can't afford it, so you keep doing krokodil. Until you die."

Grim tally
2.5 million
Drug addicts in Russia, according to estimates

100,000
Russians estimated to use krokodil

65 million
Doses of krokodil confiscated by Russia's Federal Drug Control Service in the first three months of this year

2 million
Heroin-users in Russia, according to unofficial estimates

30,000
Russians die from heroin addiction every year, a third of global deaths from the drug

- INDEPENDENT

* Some of the names in this story have been changed.