Italian Liberalisation Law Passes Final Hurdle; Pharmacies Plan Strikes, Warn of Thousands of Closures
The Italian liberalisation law, including many measures relating to pharmacies and pharmaceutical care, has finally been introduced, and in response, pharmacists' association Federfarma has announced strike action.
IHS Global Insight Perspective
Federfarma, the Italian association of independent pharmacists, has announced strike action in response to the implementation of the liberalisation law, which contains numerous measures relating to pharmacies and pharmaceutical care that it considers to be unfavourable to its members.
The law has taken a long time to push through the legislative system, as different interest groups have jostled for precedence; it remains a highly divisive piece of legislation.
There is little doubt that a considerable amount of disruption lies ahead in the pharmaceutical sector in Italy, as Federfarma and other pharmacy associations prepare to demonstrate their anger at the measures in the new law; this promises to be very negative for the pharmaceutical industry in the short term.
Liberalisation Is Finally Law
The liberalisation law—known as the "Save Italy" law—was passed yesterday (22 March) by the Chamber of Deputies of the Italian parliament, bringing to an end months of speculation and changes to the final wording. It is certainly not bringing to an end the disputes and disagreements emanating from its measures though.
Federfarma Will Strike
The Italian association of independent pharmacists, Federfarma, has announced that its members will be striking on 29 March, in protest against the measures in the liberalisation law, in particular focusing on the requirement for pharmacy owners who are aged 65 and over, who will have to employ a pharmacy manager under the new law, or face closure. In its press release responding to this measure, Federfarma argues that this will mean that in the case of low-income pharmacies, which will not be able to afford to hire and pay a manager, they will be forced to close down. Although under Italian legislation strikes must be called with at least a notice period of 10 days, president of Federfarma Annarosa Racca is reported by Italian newspaper La Nazione as saying that the association is not obliged to comply with the rules, in view of the fact that—in her estimation—as many as 1 million Italians could lose their local pharmacies as a result of the new legislation.
Thousands of Pharmacies Under Threat of Closure
Federfarma is joined by another association of pharmacists, the MSFI, in its warnings about the effects of the new legislation, with the latter predicting that thousands of pharmacies will close, reports Italian online newspaper Blitz Quotidiano. In the Lazio region alone, Federfarma is predicting the closure of around 300 of the 1,400 pharmacies currently in operation, reports Italian newspaper Affari Italiani, with certain areas predicted to lose 90% of their pharmacies.
Main Measures of Article 11
The main measures of Article 11 of the law—the article relating to pharmacies—include the following:
- Pharmacists are obliged to substitute the proprietary (originator) product prescribed by doctors with the lowest-priced equivalent (generic or otherwise), unless the doctor states specifically that the prescription is non-substitutable, or unless specifically requested by the patient; additionally, pharmacists are only permitted to dispense a medicine with the same characteristics as the one prescribed by the doctor with a price higher than its reference price at the express request of the patient.
- The Italian Medicines Agency (AIFA) is due to prepare a resolution overhauling the existing regulations on the packaging of pharmaceuticals, with the intention of establishing a more flexible system that is able to optimise resources, including the possibility of single-dose packaging.
- The threshold for the eligibility to sell Class "C" medicines in drug stores of 12,500 inhabitants has been abolished.
- The number of pharmacies permitted in proportion with the number of inhabitants is being reduced from 5,000 to 3,300.
- It will be possible to open pharmacies in ports, airports, stations, and service areas.
- Pharmacies are free to remain open at times other than those when they are required to be open.
- Pharmacies can offer discounts on the prices of any products sold "directly" to consumers (i.e. without a prescription), on the condition that adequate information is provided.
- Drug stores will be able to sell veterinary medicines with or without prescriptions.
Outlook and Implications
Pharmacists may be furious about the decision by the Ministry of Health to impose the rule about appointing a pharmacy manager in the case of pharmacy owners over 65, although this is by no means the only thing they are very agitated about. The final version of the law includes a measure meaning that all drug stores (parapharmacies) will be able to sell Class C medicines (non-reimbursed prescription medicines) defined in a list by AIFA, and not, as previously planned, only those in communities with less than 12,500 inhabitants (see Italy: 29 February 2012: Amendment to Italian Liberalisation Law Restores "Equality" to Branded Drugs and Generics). Thus, in the case of the medicines AIFA chooses to "liberalise" the sale of, pharmacies are likely to lose a significant proportion of their markets. This could include such popular medicines as the erectile dysfunction drug Viagra (sildenafil) and its equivalents.
Clearly, for the pharmaceutical industry, the prospect of many pharmacies in Italy closing is not a positive one, although the concomitant prospect of many new drug stores opening offers an alternative strategic option. With the intention behind the law being one of cost containment and price reduction, however, there is certainly a negative impact in terms of pushing down unit prices.
As far as provisions for strengthening the law on generic substitution are concerned, the initial optimism of the generics sector in Italy has been eroded, as the wording of the points in Article 11 have changed to give greater autonomy to prescribers. Although there may be greater official support for the concept of generic substitution, the lack of an adequate system in place to monitor compliance is seen as crucial (see Italy: 14 March 2012: Italian Generics Association Expresses Doubts About Implementation of Norms). There is likely to be a small boost to generics as a result, but no more.
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