Pharmacies' turnover has fallen amid reform and pandemic ({{contentCtrl.commentsTotal}})

Sign in an Apotheka indicating the pharmacy has no masks for sale.
Sign in an Apotheka indicating the pharmacy has no masks for sale. Source: Anna Aurelia Minev/ERR

During the first month of the nationwide pharmacy reform, there have been no claims made against the state for damages. Meanwhile, the emergency situation to combat coronavirus has increased their workload and turnover has fallen.

On April 1, a nationwide pharmacy reform was introduced which required a minimum 51 percent ownership of pharmacies by the dispensing pharmacists who work there. It was argued this would lead to mass closures particularly in smaller population centers.

A total of 468 pharmacies will continue operating across the country and 25 pharmacies announced their closures. Some of these will reopen as pharmacist-owned pharmacies within the next two months. ERR's news in Estonian talked to representatives and pharmacists to see how the first month had gone and how they were dealing with the emergency situation.

Kristi Sarap, the head of communication of the State Agency of Medicines, said the change of ownership was much more painful for pharmacy's customers than was expected and discussed. At present, there are 470 pharmacies owned by pharmacies in Estonia that meet the requirements.

"The pharmacy market is not a stagnant system, but an evolving system, so there will be more pharmacies and closures, and this happened before the pharmacy reform," she said, adding new pharmacy owners are still settling in and there is still room for analysis.

In connection with the pharmacy reform, 25 pharmacies closed down, some of them at the start of the year. In the meantime, one pharmacy in Tallinn has opened.

"The COVID-19 epidemic and the emergency also put pharmacies in a difficult position, because their employees had to be protected and people still needed medicines. Fortunately, in cooperation with pharmacies and wholesalers, we were able to resolve various concerns quickly," Sarap said. She added some pharmacies have been temporarily closed due to the pandemic.

Sergei Romanov, the owner and manager of Sillamäe Pavlovi Pharmacy, which operates under the brand name of the Euro Pharmacy, said the priority of pharmacists has been to keep their pharmacy open despite difficult times. "April was the most challenging month in my experience of running a pharmacy so far. The numbers of pharmacy visits indicate that people stuck to the movement restrictions recommendations, they were at home," he noted.

Romanov said the number and turnover of pharmacy visits dropped compared to the previous month and the same time last year but costs are increasing to ensure the safety of staff and customers. He estimated the turnover of the pharmacy market fell by about 20 percent in April compared to the same period last year.

Kaidi Kelt, the franchise manager of Benu Pharmacy, said it has also been difficult for pharmacies to adapt to the new situation, as the reform was carried out in the middle of a virus outbreak. 

"Pharmacies can keep their doors open, but that doesn't mean the situation is the same as before the crisis. Restrictions on movement and restrictions on purchases of medicines will put additional strain on companies. Everyone is trying to adapt, but it's only the first month," she said.

Timo Danilov, the head of the Estonian Pharmacy Association, said things can seem rather calm in April after the months leading up to the reform, but work load has increased for everyone. "Pharmacists are focusing on dealing with emergencies," he added.

Pharmacy chains have not yet filed claims for damages with the state

The Ministry of Social Affairs said pharmacy chains have not to filed claims for damages against the state.

However, companies which previously operated as a pharmacy chain have not given up on the idea and are analyzing the situation. As the only chain, Euroapteek announced in early April that they did not plan to file a claim for damages with the state. 

The Benu chain has not made a final decision. "The law gives us enough time to file a claim for damages, and we're using that right now. We're doing the analysis," said the company's franchise manager.

Risto Lauri, Chairman of the Management Board of Pharma Holding OÜ, which sells under the Südameapteek brand, said there are bigger priorities to be dealt with in the current situation. "We have enough time to make a claim if we make such a decision," he said.

Margus Linnamäe, the owner of Magnum, which is the owner of the Apotheka retail chain, was the first to confirm the intention to submit a financial claim to the state after the reform entered into force. Apotheka did not respond to ERR's questions. 


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Editor: Helen Wright

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