As an inevitable result of Russia’s higher education policies of the past two decades, new university leaders in and outside of Moscow and St. Petersburg have emerged, and vertical differentiation has increased. Inequality of educational potential has a strong regional dimension, exerting a considerable delayed impact on regional socioeconomic development. Differences in universities’ resources affected their ability to adapt their instructional, research, and administrative processes during the pandemic, thus broadening the education and research quality gap in higher education. Some regions may face an increased outflow of youth talent to universities based in Moscow and St. Petersburg, that will certainly weaken the socioeconomic growth prospects of Russia’s regions. The pandemic accelerated the debate over this problem and demonstrated readiness of universities for joint efforts. This leads to an expansion of policy to create a cooperative network of universities and their stakeholders so as to reduce institutional differentiation and promote exchange of experience and competence among universities. This paper investigates into the main characteristics of vertical differentiation in Russian higher education that had been in place when the pandemic broke out and determined whether universities succeeded or failed in switching to distance learning. Furthermore, lockdown measures and their economic impact on different types of universities are analyzed. Finally, we discuss possible avenues and specific considerations for expanding cross-institutional collaboration and engaging stakeholders in university development.