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Competition stiff for Sweden's new pharmacies: report

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Competition stiff for Sweden's new pharmacies: report
12:41 CEST+02:00
Sweden's privately-owned pharmacies are suffering from financial troubles. The largest player on Sweden's pharmacy market, Apotek Hjärtat, has reported a loss of 358 million kronor ($56.4 million) after taxes, reports financial newspaper Dagens Industri.

"Competition is even stiffer than it was last year. Very many new pharmacies were established in the end of 2010, and the competitive pressure continues to grow higher all the time," Bodil Eriksson, deputy CEO of Apotek Hjärtat, told the newspaper.

Sweden had a state-run pharmacy monopoly until just over two years ago. On July 1st, 2009, the monopoly ended, and more than 20 new entrants enthusiastically entered the market for drug sales.

Two-thirds of formerly state-owned outlets were sold to private actors, and 200 new local pharmacies have been established.

The new entrants on the market are now bleeding from the stiff competition, which is threatening to shut down several of the new pharmacy outlets, reports Dagens Industri.

"I claim there's an over-establishment in several parts of Sweden," said Fredrik Söderberg, CEO of privately-owned pharmacy Medstop, to the newspaper.

A report from the Swedish Competition Authority (Konkurrensverket), published in January 2011, concluded that one effect of the deregulation of pharmacies has been that many small towns now have pharmacies that did not have one prior to July 2009.

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