Pharmacy liberalisation process stopped in Hungary

2010-07-26

The Hungarian parliament has approved a proposal to end the liberalisation process pertaining to the establishment of a pharmacy. In accordance with the proposal, the opening of new pharmacies in Hungary will be prohibited from the second half of July onwards, with the exception of towns which do not have a pharmacy at the moment. The temporary moratorium will end on 1 January 2011, when new rules on the opening and operation of pharmacies will come into force.
These new rules will include a stipulation that the owner of the pharmacy must be a pharmacist and must own more than 50% of the business.
As a result of the liberal law governing the establishment of pharmacies in Hungary several pharmacies owned by pharmacists became bankrupt as a result of price competition from pharmacy chains. Furthermore, according to Tamas Heintz, a member of parliament, although the number of pharmacies increased from 2007 onwards, most of the new pharmacies opened in cities, whereas a number of small towns remained without a pharmacy.


After the introduction, in 2007, of more liberal rules pertaining to the establishment of pharmacies in Hungary (i.e., the lifting of demographical and geographical restrictions) more pharmacies opened and pharmacy chains were established. As a result, the number of pharmacies in Hungary increased from around 400 to more than 2,400 over the last three years but the number of redeemed prescriptions, 150 million, remained unchanged. This must have led to a difficult financial situation for many outlets (in February 2010 as many as 400 pharmacies were on the verge of bankruptcy), exacerbated by the government’s abolition
of non-repayable subsidies for pharmacies from the 2010 budget. According to the Hungarian Chamber of Pharmacists (MGYK), the number of pharmacies in Hungary should fluctuate around 2,000-2,100, given the country’s population.
Steps to end the liberalisation process pertaining to the establishment of a pharmacy have also been taken in Poland, where the Supreme Council of Pharmacists the (NRA) has suggested the introduction of geographical and demographical rules on the opening of new pharmacies in addition to a ban on the ownership of pharmacies by non-pharmacists. The Chamber is planning a public protest in September to bring the matter to the attention of the Health Ministry.

Agnieszka Stawarska
Pharmaceutical Market Analyst
PMR Publications