Greece’s Financial Crisis and Devastated Healthcare System - Pharmaceutical Technology

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Greece’s Financial Crisis and Devastated Healthcare System
Greece’s economic crisis has battered the country’s healthcare system, resulting in medicine shortages, market withdrawals and falling profits for the pharma industry.

Pharmaceutical Technology Europe

Pharma industry views

Many drugmakers are adopting a negative view of Greece's pharmaceutical market, which is also contributing to difficulties. On the one hand, companies have to conform to the low prices demanded by the government, but then they also find their own products in circulation in other European markets. Consequently, some manufacturers have stated that they are competing against their own products in these foreign markets (5). Another concern has been the influence that Greek prices might have on the way other countries set their prices. As some countries use Greece as a reference point, there could be a steady lowering of prices throughout Europe.

The restrictions of the Greek pricing system were so severe when first introduced that some manufacturers started to reduce supply. In 2010, Novo Nordisk took some of its insulin products off the Greek market, claiming that as well as price cuts reducing profits, it was also owed around €26.1 million by the Greek government (7). An estimated 50000 diabetic Greek patients were using these products and the company's move led to an outcry. Novo Nordisk responded forcefully, accusing the government of mishandling the economy and putting patients and the company in the difficult position.

Another Danish company, Leo Pharma, took a similar approach and issued a Notification Letter of Discontinuation covering the potential withdrawal of 18 of the company's 29 products on the Greek market (8). The company also claimed that it was owed $300 million (€223.4 million) by the Greek government. However, Leo Pharma was particularly worried about the impact of Greek prices on pricing decisions in other countries that use Greece as a reference market.

In 2011, Roche halted delivery of some of its anticancer products and other therapies to some of the public hospitals that had not paid their bills (9). It stated that some hospitals had failed to pay the company for more than four years, but that it was boosting supply to pharmacies that had been reliable clients. In general, privately-run pharmacies have had a better track record of fulfilling payment than public hospitals. Patients could take their prescriptions to these pharmacies and, in the case of intravenous or injected cancer drugs, take them back to a hospital to have them administered. In this way, the company believed that patients would not be deprived of their medicines.

Representatives of the Greek pharma industry have also complained about the government's attitude (9, 10), arguing that pharmaceuticals only account for a small proportion of the healthcare expenditure and that little is being done about other aspects of spending, such as diagnostic tests and medical procedures.

As Greece already has some of the lowest prices in Europe, the government has already exhausted all possibilities to extract savings from medicines. They have also stated that the pharmaceutical industry understands how critical the current circumstances are and the need for flexibility, and therefore seeks sincere dialogue with the authorities. However, the representatives add that the current approaches being used will do nothing to resolve long-term problems. It has also been suggested that the government is basing its decisions on flawed data. One recommendation was to harness the benefits of information technology so that a full picture of the waste in the healthcare system could be revealed (9). By studying the way in which the supply chain was monitored from product distribution to use of medicines by patients, the effectiveness of the whole system could be improved.


The situation in Greece continues to look bleak. As it is unclear what comes next for the economy as a whole, it is difficult to see how the healthcare sector will receive improved funding. In the short term, Greece will remain an unattractive market for companies seeking to launch innovative medicines with high prices. However, pharmaceutical companies already have experience of operating in tough markets. They will likely continue their presence in Greece, but will be highly selective in the products they bring to market there.


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