Dynamic and Regulated Competition in the Portuguese Pharmacy Market

Abstract

Introduction: The pharmacy sector in Portugal has faced a time of profound changes and challenges: from market deregulation until the implementation of austerity measures as consequence of the international crisis boosted in 2008 and the signature of the Memorandum of Understanding (2011) between the Portuguese Government and Troika. The economic unsustainability of the sector and in consequence, the increasing number of pharmacies in insolvencies or seizures is a reality. This study analyses the dynamics of the pharmacy market following the introduction of pro-competitive measures and the impact of the economic crisis while the market was adjusting to a new configuration and structure. Methods: A retrospective analysis was conducted using data from ANF national registries of community pharmacy between 2010 and 2016. Closures were counted for existing pharmacies and openings were counted for new pharmacies and reopenings. Descriptive statistics and correlation analysis were performed. Results: The results show the existence of a dynamic and competitive market, evidenced by the entry and exit of pharmacies. In the last six years 236 pharmacies opened and 147 closed, which shows a positive balance with 89 new pharmacies. The distribution of pharmacies seems to follow citizens’ needs meeting the national health policy goals of equity and access to health care services. Conclusion: These results suggest that pharmacies were able to restructure and adapt to times of change and a mature and fully functioning market. The flexibility of the legal framework promotes a market of regulated competition through the entry and exists of pharmacies.

Keywords

• Economic Competition; Government Regulation; Pharmacies; Portugal