One-sixth of Hungarian pharmacies threatened by bankruptcy

2010-03-04

Tamas Horvath, the CEO of the Hungarian Chamber of Pharmacies, has claimed that as many as 400 Hungarian pharmacies could go bankrupt because the government has abolished non-repayable subsidies for pharmacies from this year’s budget. In Hungary there were approximately 600-700 pharmacies which used to receive HUF 50-150,000m (€180-550) of state aid per month.
Furthermore, there are significant numbers of unprofitable pharmacies in Hungary which are not likely to be taken over by large pharmacy chains because of the losses they make, according to Ferenc Szabo, the CEO of the Hungarian Association of Pharmaceutical Wholesalers.
This difficult situation has arisen because, over the last three years, the number of pharmacies in Hungary has increased from 412 to 2,407, but the number of redeemed prescriptions, 150 million, remained unaltered. The situation is already dangerously out of control, as many pharmacies cannot pay wholesalers on time.
Pharmaceutical wholesalers were forced to introduce certain measures, including the establishment of credit limits for pharmacies, in order to protect their revenues. According to Tamas Horvath, the abolished subsidies were of crucial importance to small pharmacies located in the rural areas of the country, which can count, this year, only on the amount received from the so-called “solidarity tax”, HUF 200m (€0.7m) in total, which is paid by those pharmacies earning the most substantial revenues from reimbursed drugs.