Czech Pharmacies close down amid row over profit margin

There are approximately 2,200 pharmacies in the Czech Republic and most of them closed their doors to the public for three hours on Monday. Pharmacists are protesting against a new regulation that came into effect on January 1 this year, which they say lowers their profits dramatically. They claim it's a regulation that threatens the existence of a quarter of pharmacies in the country.

Photo: CTK

"We will not be closed down. Rath is a health hazard. Shame on him!" This is what some 1,500 pharmacists chanted outside the Health Ministry on Thursday. They flocked to Prague from all corners of the country, angered at Health Minister David Rath, who persuaded the government to lower the profit margin of chemists from 32% to 29%. This basically means that out of every 100 crowns we spend in the drug store, 17 crowns go to the pharmacists; instead of 19.5 crowns.

While chemists say this is enough to threaten their existence, especially that of smaller drug stores in towns and villages, Health Minister Rath strongly rejects this argument. Chemists have been enjoying profits that most Czechs would only dream of, and proof of that are the numerous pharmacies that are opening up around the country, Mr Rath argues:

"Many people come to us saying there are two or even three pharmacies in a small town with a population of four or five thousand. Some of them will suffer but one will definitely always prosper."

The head of the association of pharmacists, Lubomir Chudoba, says many are seeing profits plummet by up to 15 percent, driving them to bankruptcy. This pharmacist who would like to stay anonymous is from northern Moravia's Ostrava region. She explains why her drug store may soon have to close down:

Photo: CTK

"The expenses of pharmacies are high because of the professional staff and the hi-tech equipment that is needed. The lower profit margin, which is the lowest in Europe - with the exception of Estonia, I think - makes it difficult for many smaller pharmacies to cover all expenses. Health Minister Rath furthermore wants to make it common practice for doctors to not only prescribe medicine but also to give it out."

Some 90% of the country's pharmacies closed their doors to the public between noon and 3pm on Monday. Only pharmacies in the state-run hospitals and some in hypermarkets whose contracts bind them to stay open did not join the strike. On Monday morning a petition signed by 1,650 pharmacists was taken to the government. An all-day telephone line was also opened to the public.

But Health Minister Rath says raising the new profit margin is not up for discussion. Cost-cutting measures are vital throughout the entire health sector and pharmacists cannot be spared.

"The proposals that pharmacists always come up with cannot save a single crown. Our goal is to save costs and stop people from squandering money - we started with the doctors, then went on to the profit margins and will continue with our mission."