The proposal to establish a state distribution company to supply medicines is unfeasible, say medicine distributors

The Ministry of Health’s proposal to establish a state distribution company for the supply of medicines and medical devices is unfeasible. The Association of Wholesale Distributors of Medicines (AVEL) claims this in a press release. According to the association, this proposal contradicts a number of legal regulations, is based on incorrect and false assumptions and has a high potential to disrupt fair competition.

“The establishment of a state company for the distribution of medicines and medical devices is not based on a real need. On the contrary, we perceive the submitted proposal as illegal state aid and restriction of economic competition. The result for citizens can be the purchase of medicines at a worse price and under worse conditions than other competitors could provide,” pointed out the executive director of AVEL Matej Petrovič.

Considering the high financial demands of wholesale distribution, the implementation of the proposal according to AVEL would mean inefficient use and waste of public resources. In a situation where the market is strongly regulated and reliably ensures wholesale distribution of medicines, AVEL does not see any sense in this proposal. “Despite the fact that it is highly likely that the submitted proposal will not pass the state aid test, AVEL members will take all available legal steps to protect their rights in the event of its acceptance and implementation,” the association said.

The Ministry of Health of the Slovak Republic wants to establish a state distribution company for the supply of medicines and medical aids. With this step, he plans to streamline the distribution of medicines and ensure the self-sufficiency of state medical facilities in the supply and distribution of medicines. The establishment of a distribution company will require 15 million euros as a capital contribution at its establishment. According to the ministry, the establishment of a state distribution company could prevent a narrow circle of private companies from taking a dominant position on the drug market and their disproportionate influence on the price of drugs and their distribution. “The Ministry of Health of the Slovak Republic believes that in the mentioned segment it is necessary to ensure at least partial independence of the state from private distributors of medicines and medical devices, which is necessary in case of extraordinary situations, such as the recent pandemic of the disease COVID-19,” the department added.