PharmExec
There are some evident challenges for pharma in
the ongoing Greek crisis. But, writes Reflector, there are some less evident
challenges which may, over time, prove to be more difficult for the industry to
cope with.
First, the immediate challenges. And because the crisis is, at least in its
origins, economic, the economic challenges are the most obvious. How to make
money through normal commerce in a market which has become conspicuously
abnormal? For years drug manufacturers have had difficulty in obtaining payment
for their supplies, in the same way as wholesalers and hospitals have had
difficulty in obtaining the money to pay manufacturers because of interruptions
to their own revenue streams. Estimates of the level of unpaid debts vary, but
European manufacturers have spoken of carrying unpaid invoices worth more than north
of a million dollars. And whichever way the broader discussions with
international creditors of a resolution to Greece’s problems play out over the
summer, there is little prospect of things getting better, and every prospect
of them getting worse. Those debts are likely to pile up.
The abnormality of the market has other facets. Exchange controls and
sharpened economic decline have created new liquidity constraints that impede
patients from paying pharmacists, pharmacists from paying wholesalers, and
wholesalers paying manufacturers. Wholesalers promised the minister of health
to continue to supply the market with the usual quantities as well as with
the usual economic terms – but with the obvious risk of cashflow
problems. One wholesaler said: “I really do not know (and this is my greatest
fear) whether the medicines which I supply to pharmacies will be paid in euro,
drachmas or will never be paid if the economy collapses.”