Government greenlights bill to allow hospital pharmacies to import drugs
The government approved a bill on Thursday that allows hospital pharmacies to independently import medicines into Estonia. The bill had previously faced opposition from the Eesti 200 party. Irja Lutsar, a member of the party's parliamentary group, stated that while she supports the general principle of the bill, there are differing opinions on some of the details, which will be discussed once the bill reaches the Riigikogu.
Up until now, the Medicines Act has only allowed hospitals to purchase medicines from Estonian wholesalers. With the new legislative amendment, hospitals would be granted the right to import medicines and active pharmaceutical ingredients themselves, in order to supply hospitals, care institutions or emergency services.
"This will increase competition and boost our healthcare system's crisis preparedness," Prime Minister Kristen Michal (Reform) explained at a government press conference on Thursday, highlighting the necessity of the amendment.
Minister of Health and Labor Riina Sikkut (SDE) said that this long-discussed change will help hospital pharmacies fulfill their duties more effectively.
"On one hand, they prepare medicines administered to patients in hospitals, so they need certain raw materials. On the other hand, there are some medicines, which, for example, do not have a marketing authorization in Estonia but are needed for specific patients. Currently, the supply chain – doctor, hospital pharmacy, wholesaler – is long, and it can take time for the medicine to reach the patient. But if the hospital pharmacy can import the medicine directly, it will reach the patient faster," Sikkut explained.
She also pointed to an assessment by the Competition Authority, which noted that there is limited competition in Estonia's wholesale medicine market, and allowing hospital pharmacies to import medicines could change the dynamics of the market, potentially lowering prices for pharmacies.
Initially, the bill concerning hospital pharmacies was supposed to be brought before the government last week, but it was removed from the agenda at the request of the Eesti 200 party.
On Wednesday evening, Sikkut met with the Eesti 200 parliamentary group, and its member Irja Lutsar told ERR that they shared an understanding with the minister that Estonian patients deserve the best medicines at the most optimal price.
"Secondly, we fully agree that there are situations and patients for whom direct import would certainly speed up access to medicines," Lutsar said, adding that they also reached a consensus on presenting the bill to the government on Thursday. "Perhaps there are still some differing opinions regarding the wording of the bill, but once it reaches the Riigikogu, we will discuss it and see how the majority of the parliament decides."
Lutsar said it was too early to specify which nuances of the text might need changing but emphasized that she has always supported the general principle of the bill.
"For instance, radiotherapeutics, which have a very short half-life, must arrive here quickly. There has also been media coverage about the use of bacteriophages, which are very interesting preparations tailored to a specific patient," she noted.
According to Lutsar, it is logical for hospital pharmacies to be allowed to import such medicines, as well as some other drugs not registered on the Estonian market but necessary for individual patients.
The amendment is not intended for commercial purposes: hospital pharmacies would not be able to add a markup to the medicines or participate in tenders for other hospitals.
However, Estonian pharmaceutical wholesalers could potentially be affected by the hospital pharmacies' ability to purchase medicines from abroad. Representatives of pharmacies, pharmacists and wholesalers have previously criticized the idea, arguing that public funds would be used where the private market already operates, potentially increasing uncertainty in the market.
The Competition Authority has welcomed the amendment, as it could drive down the prices of medicines.
Two major wholesalers currently dominate the Estonian pharmaceutical market – Tamro, owned by Phoenix, and Magnum, owned by Margus Linnamäe. Before returning to politics, former Eesti 200 leader and foreign minister Margus Tsahkna had collaborated with Linnamäe, working as the export manager for his defense industry firm Semetron and acquiring a stake in MM Hospital, a company established in July 2022 to supply military hospitals. He sold his shares after becoming foreign minister.
Eesti 200's current leader and Minister of Education Kristina Kallas has previously told ERR that neither Linnamäe nor Tsahkna were behind the party's opposition to the bill. Tsahkna himself said last week that he has sold his stakes and does not comment on malicious rumors.
As of April 1, there are a total of 24 hospital pharmacies in Estonia, according to the Estonian State Agency of Medicines. Sales to hospital pharmacies account for 28 percent, or nearly €129 million, of the total wholesale pharmaceutical market, based on the agency's statistics.
If a hospital pharmacy chooses not to begin direct imports, the current procurement process for medicines will continue as usual.
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Editor: Karin Koppel, Marcus Turovski