Estonian businessman Linnamäe prepared to give up pharmacies, to submit claim to state

Margus Linnamäe.

PHOTO: Konstantin Sednev

Margus Linnamäe, owner of pharmaceutical wholesaler and retailer Magnum, upon entry into force of the pharmacy reform is to hand over the Apotheka pharmacies of Terve Pere Apteek OÜ to the pharmacists currently working in the company and will also submit a claim for expropriation to the state of Estonia. The size of the claim is currently being determined by legal experts.

“I am extremely disappointed that the state of Estonia has started eliminating free entrepreneurship and conducting an irresponsible experiment with public health. Five years ago, a law was passed limiting the majority ownership of pharmacies to pharmacists only. However, despite this, the state has been unable to equip the transitional period in a way that guarantees fair compensation to current pharmacy owners. This is an unprecedented situation in Estonian history, where entrepreneurs are forced to give up their businesses. No one in our country can no longer have a guarantee of the inviolability of property,” Linnamäe said in a press statement made on Friday morning.

“Unfortunately, the Ministry of Social Affairs has not met the expectations of market participants in developing implementing measures for the reform. It was already clear when the law was passed that pharmacists would not be able to obtain pharmacies from current owners at fair prices without state guarantees and assistance programs. In a situation where hundreds of pharmacies are facing mass closures, the state lacks analyses and plans to prevent a crisis. Regrettably, the state has created a situation where, in less than two months, patients will be at risk of an interruption in access to medicinal products and pharmacy services,” the businessman added.

“It is largely thanks to the leadership of chain pharmacies that we have modern pharmacies and quality service today that are taken for granted by pharmacy visitors. A study by Kantar Emor also confirmed that the Estonian pharmacy market is working very well and people’s satisfaction with the service is high. All the more astonishing is the consistent desire of the Ministry of Social Affairs to enforce the reform, despite the fact that there is no need for such a radical change and, as has become clear by now, it is practically impossible to carry out by way of ownership transfer,” he said.

“In the developed situation, with less than two months left until the reform enters into force and pharmacies cannot be sold, I decided to hand over the pharmacies to the pharmacists currently working in the company. Patients do not have to suffer from the pharmacy reform, but the state must compensate businesses for the fair price of pharmacies,” Linnamäe added.

“Although, less than two months before the pharmacy reform enters into force, there is still a seeming debate continuing among politicians about whether or not the pharmacy reform is needed, I do not believe that the wish is to actually stop the reform. That is why I made the fundamental decision to hand over the pharmacies to my current pharmacists, whose experience provides assurance that pharmacy service will be provided and developed to the same high standards as it has been until now. These pharmacists take responsibility for ensuring the availability of medicinal products to the people of Estonia also after the pharmacy reform enters into force,” he said in the statement.

“I have been building my company for over 25 years and it is clear that it has its value and price. The Constitution provides for immediate and fair compensation in the event of expropriation. The state must compensate the entrepreneurs for the damage caused,” Linnamäe added.