The cure for monopoly

The Ministry of Industry and Trade and pharmacy chains are surprised by the activity of the FAS

The steady trend towards a reduction in the number of state and municipal pharmacies that has emerged in recent years has noticeably worsened the situation of Russian beneficiaries, especially those who live in remote cities and villages with a population of no more than 100 thousand people. This conclusion was made by specialists from the department for control of the social sphere and trade of the Federal Antimonopoly Service (FAS), after analyzing data from 79 territorial antimonopoly authorities this year.

Yesterday, the head of this department, Timofey Nizhegorodtsev, published the original statistical data that his subordinates managed to obtain. In his opinion, these data clearly prove that the trade in medicines has developed too freely in our country over the past 18 years, without taking into account the existence of antimonopoly law. And now is the time to return it to the framework outlined in the legislation. Judging by the speech of Mr. Nizhegorodtsev, this means first identifying all the “economic entities” that occupy a dominant position (that is, having a share of more than 35% in the retail market of one municipal district or region), and the “collective dominants” - the three largest players, which together occupy at least half of the local market. Then compile a single register of monopolists, and then analyze individually how each of them builds their pricing and assortment policy. “Hundreds of companies will be included in this register,” Mr. Nizhegorodtsev assured. According to the FAS, in almost a quarter of all territorial units with a population of less than 100 thousand people there is only one pharmacy. And there are thousands of such municipalities.

True, how the antimonopoly agency is going to influence the concentration of pharmacy companies, and even more so to achieve a more responsible pricing policy from them, is completely unclear. Moreover, the declared critical level of consolidation - 35% - is far from certain. Thus, the Ministry of Industry and Trade, to which FAS officials had already offered this figure as a base when working on the law “On Trade,” was skeptical about them. The Ministry of Industry and Trade believes that only a company that has more than 50% of retail outlets in the local market can be recognized as a monopolist, Vremya Novostei was told in this department.

The activity of the FAS and the promises voiced by Timofey Nizhegorodtsev to deal with monopolists in the courts perplexed representatives of the pharmacy market. “Actually, what difference does it make who owns how many pharmacies? - Elena Nevolina, head of the Russian Association of Pharmacy Chains, told Vremya Novostei. “The consumer is completely indifferent to this; it is important for him that there is a pharmacy and that the drugs are sold there at normal prices.” According to her, there is no queue of people wishing to open pharmacies in hard-to-reach regions and in the provinces. “And if there had been, say, not one trading company, but two or three, nothing would have changed in terms of prices,” says Ms. Nevolina. According to her, in remote regions there is virtually no more than one distributor who sells drugs to all retail companies at the same price - even if there are ten of them.

In fact, the form of ownership of the pharmacy is of fundamental importance for the consumer - whether it is private or state-owned. After all, this is what the assortment in practice depends on. Private traders prefer not to deal, for example, with potent and narcotic drugs, since this implies special storage conditions (alarm system, bars on windows, steel doors - all together more than 400 thousand rubles, plus monthly maintenance of 50 thousand rubles). When pharmacies become private property, according to a FAS representative, cheap items included in the preferential list often disappear - it is unprofitable to import them to many places. “As a result, the citizen suffers, who is often deprived of the only opportunity to receive subsidized medications,” says Timofey Nizhegorodtsev. “Therefore, it seems appropriate to introduce the preservation of the minimum assortment matrix as a prerequisite for the privatization of pharmacy institutions.”

Next year, the Federal Service intends to bring this proposal to the legislative level.

Galina PAPERNAYA