Italian Aspirin Extortion

From a New York Times article about Italy’s malaise:

Small proposals bring protesters to the streets, one hurdle to making changes as protected interests seek to preserve themselves. Pharmacists shut their doors this year when the government threatened to allow supermarkets to sell aspirin. The cost for just 20 aspirin tablets at a pharmacy is $5.75.

It’s not just Italy — this is a European phenomenon.  It seems more than outrageous for Italy’s pharmacists to insist on extorting such sums from their customers — especially in a country that, as the rest of the article makes clear, is sliding into poverty. There’s no real reason for pharmacists to exist anymore, except to control the distribution of genuinely dangerous or specialized drugs.  Yet European countries have all sorts of loopholes and subsidies that keep specialty pharmacist shops alive, and that give them monopolies on the distribution of harmless things everyone needs, such as aspirin. 

Now, I’m pretty sympathetic to the goal of these regulations, which seems to be to keep lots of small independent pharmacists in business.  A small businessman who runs a pharmacy likely has more pride and independence than some minimum-wage cashier in an anonymous drugstore chain.  But there has to be a much better way of achieving this goal than giving them a license to gouge their customers…

8 thoughts on “Italian Aspirin Extortion

  1. a) For one, many German Apotheken (ie pharmacies) are now part of pharmacy chains, (probably) because these can sell to the pharmacists at better prices. Of course, you won’t initially see that, because most pharmacies try to hide that they are part of a chain and try to stress their independance.
    b) The real villains in this game are not the pharmacists, but pharmaceutical companies. I acknowledge that pharmacists are relatively wealthy compared to other shop owners (not as wealthy as doctors, though), but it’s the big companies that make the prices.
    Germany made some half-assed laws trying to force doctors to prescribe generics instead of the real thing. However, the Red-Green government was lobbied by pharmaceutical companies, plus, afterwards, the price for Generics, in Germany, rose.
    c) A side effect: Making it more pricely to buy drugs, makes it less likely that you will buy them. This means that people will think twice whether they really need Aspirin, thus making it less likely that people are going to abuse them (America has a real problem here, I think).
    d) American pensioners take long rides to Mexico to get cheaper drugs, because they could not afford to buy them at home.

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  2. German pharmacists are still pretty well-protected by two things: the Fremdbesitzverbot (prevention of third-party ownership in pharmacies) and the regulated pharmacy concession system, which in principle takes care of preventing competition in the close neighbourhood of existing pharmacies. The latter also secures the owners of the pharmacy a fairly good selling price: if you want to open a new pharmacy, instead of just opening it where you want and where you think business will be good, you’re going to have to buy an existing one including an existing concession.

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  3. Though from personal anecdotical evidence, I should like to remark that the concession system is only casually enforced or does not work at all: There are 3 pharmacies in my immediate vicinity, say within a radius of a quarter mile. They can’t be catering to much more than 1,500 people between all of them. I’ve really kind of wondered how they make their living; thanks to Andrew’s post I know now: It’s extortion!

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  4. I can confirm what Junger Gott wrote, here in the central parts of Berlin you just have to walk five minutes to find at least two or three Apotheken. Sometimes more.

    In Italy as in Germany you have to really study to become a pharmacist. Out of curiosity: What education is required in America?

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  5. Let me just note here that I have not claimed that there are too few pharmacies; I have plenty to choose from in my own neighborhood. Nor am I opposed to programs designed to keep them in business. Far be it from me to advocate that anonymous chains take over all aspects of retail commerce. I work against that every day by buying many things locally from locally-owned stores.

    Nor am I contesting in any way the role pharmicists can and should play in controlling the distrubution of dangerous or specialized drugs. They do that in the United States as well, and they have to be specially trained for that, just as they are in Germany.

    My only objection concerns “harmless things everyone needs,” (to quote my post). Such as aspirin. I see no reason any European should have to pay the prices Europeans have to pay to buy completely normal aspirin. Every time I go to the U.S., I buy bottles of 100 aspirin for about 1 euro, and distribute them to my friends over here.

    The analogy I would draw is to auto repair garages. Nobody doubts that a trained mechanic should repair your brakes or motor. But what if you had to pay 1 euro extra per liter to buy gas, simply because the owner of your local Tankstelle could charge it? I doubt very many Germans would be happy about that.

    And if you don’t think aspirin sales make up a significant porttion of the profits of independent pharmacists, then I have a question: why would Italian pharmacists have gone on strike about precisely this issue?

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  6. @Aaron Strontsman:

    For one, many German Apotheken (ie pharmacies) are now part of pharmacy chains

    No, not really. What you and I would consider a “chain” is still illegal.

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  7. Well, I think the mentioned monopolies are coming to an end, with typical German speed though. Already you can buy supplements and meds in the supermarket that weren’t offered some years ago. And the so called Versandapotheken seem to be a first step towards opening the market.

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  8. “The analogy I would draw is to auto repair garages. Nobody doubts that a trained mechanic should repair your brakes or motor. But what if you had to pay 1 euro extra per liter to buy gas, simply because the owner of your local Tankstelle could charge it? I doubt very many Germans would be happy about that.”
    And that IS exacly what is happening (at least in germany) right now.

    Does anyone know how much Bayer charges for Aspirin? If Aspirin were sold in supermarkets, the price would probably not drop much, but pharmacies would loose customers. And lets face it, an average person needs no more than 5 Aspirin a year, is the price realy that important?

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