site.btaMaking Medicines More Accessible to People in Remote and Underpopulated Areas - IME Analysis

A bill moved to the National Assembly in late July aims to make medicines more accessible to people living in remote and underpopulated areas in Bulgaria. An analysis by the Institute for Market Economics (IME), published on its website last Friday, says that the bill proposes the following:

• The government should fund the setting up of pharmacies, including such that will operate round-the-clock, or the sale of medicines through vending machines in settlements which are short of pharmacies;
• Corporate income tax should be reduced to 8% from the standard 10% for companies which establish pharmacies in settlements where there has been no pharmacy;
• A municipality which has no round-the-clock pharmacy should be allowed to put up a medicine vending machine.

It is a fact that some settlements in Bulgaria do not have an operational pharmacy, let alone a round-the-clock one, the IME says in its analysis. The data are indisputable, and as the sponsors of the bill note, private entrepreneurs see no point in running pharmacies in 22 of the country's 265 municipalities.

Good intentions, however, do not always lead to good decisions, particularly when it is proposed that the state become an entrepreneur, the analysis goes. The problems of remote and small municipalities are not limited to the absence of a pharmacy. Other issues may include poor internet service, trouble with water and electricity supply, and absence of a kindergarten and a cinema, which does not mean that the state should provide these services, or that it can provide them even if it wants to.

The proposed cut of corporate income tax will not resolve anything either, because a mechanism exists even now to provide financial support to pharmacies which have signed a contract with the National Health Insurance Fund or its regional office and operate in a remote area or are the only contractor for a given service in a municipality. There are 173 such pharmacies as of July 2024.

According to the IME, the low accessibility of medicines in a number of settlements can be addressed in several ways, which are well-known to all stakeholders:

1. Putting up medicine vending machines outside the pharmacy. Not surprisingly, the idea has met with fierce resistance from pharmacists for years. At present, such a machine may be installed only inside a pharmacy, which cannot help deal with the problem discussed in this analysis. The development of telemedicine, the building and upgrading of the national health information system, and the phasing in of electronic prescriptions provide valid reasons to finally ignore the lobbyist resistance of pharmacists and make the service promptly available;
2. Mobile pharmacies. Such facilities exist unofficially in some municipalities, with a pharmacist and/or a nurse usually engaged in the undertaking. It is about time the option was regulated by law, so that anyone willing can provide the service without risking a penalty;
3. Branches of existing pharmacies. With shorter working hours and operated by assistant pharmacists, branches of existing pharmacies can resolve the problems in many settlements. At present, only a master of pharmacy can run a pharmacy, which is a limitation, the IME notes. Until the possibility was eliminated years ago, it was assistant pharmacists that ran pharmacies in remote or underpopulated places, where they often made a home;
4. Home delivery of medicines from nearby pharmacies. This is a version of the mobile pharmacy, but it is important to make it applicable to prescription medicines. Technological solutions have long been available to ensure that all relevant regulations are observed;
5. Revoking the restriction that a person can run no more than four pharmacies in Bulgaria. The restriction is easy to circumvent anyway. It makes no sense and should be removed, the IME argues.

We should remember that we live in the 21st century and should think logically, boldly and out of the box when addressing problems, rather than creating more ways to limit people's choices. We should stop limiting freedom, entrepreneurship and competition for the sake of private interests and rentier attitudes, the analysis says.

Discussing reactions to the bill, the IME says that the Finance Ministry is against it because the Exchequer has not planned any resources to establish state-owned pharmacies. Reducing corporate income tax for the specified category of businesses would be unjustified and unfair to other taxpayers, the Finance Ministry said. The Bulgarian Association of Assistant Pharmacists is in favour of cutting corporate income tax and giving the state and the municipalities the right to establish pharmacies, but it is opposed to the idea of using medicine vending machines. The National Health Insurance Fund noted that a mechanism of support already exists. According to the Bulgarian Drug Agency, a bill drafted in early 2024 is aimed to regulate the use of medicine vending machines. The National Association of Municipalities approved of all ideas and set forth some of its own. The Bulgarian Pharmaceutical Union is against placing medicine vending machines outside pharmacies. The Confederation of Independent Trade Unions in Bulgaria supports the bill.