MPs reject government-backed plan for unlimited pharmacy branches, citing fears of market oversaturation and uncontrolled competition

TDT | Manama

Email: mail@newsofbahrain.com

A government-backed plan to allow pharmacies in Bahrain to open unlimited branches has been rejected by a parliamentary committee, which warned it would swamp the market and force smaller businesses out of operation.

Official data shows 73 pharmacies shut down in the past two years, struggling under tight profit margins and rigid pricing policies imposed by suppliers.

The Services Committee dismissed the proposed removal of Article 28 of Decree-Law No. 18 of 1997, which currently limits pharmacy operators to five branches, with a potential sixth under strict conditions.

Scrapping the limit, the committee warned, would spark uncontrolled competition, destabilising the sector and lowering service standards.

Official report

“Profit-driven operators could dominate the market if limits are removed,” committee chair MP Jaleela Alawi Sayed Hassan said in an official report, urging Parliament to block the proposal entirely.

Figures from the National Health Regulatory Authority (NHRA) reveal that while 131 new pharmacies were licensed between 2022 and 2024, 73 shut down due to market saturation, squeezed profit margins, and inflexible supplier pricing rules.

Bahrain currently has 456 licensed pharmacies operating across 260 branches, staffed by 677 Bahraini pharmacists.

Growing demand

Despite these warnings, the Supreme Council of Health supported the proposal, arguing that Bahrain’s rapid urban development requires more pharmacies to meet growing demand.

Officials pointed out that regulating business competition is the responsibility of the Ministry of Industry and Commerce, not health authorities.

In response to concerns about unemployed Bahraini pharmacists, the Ministry of Health confirmed several graduates had recently been hired, with further appointments planned.

Qualified pharmacists

The ministry added that only 11 to 16 qualified pharmacists currently remain without jobs. However, the Bahrain Pharmacists Society firmly opposed the plan, warning that removing the branch cap would flood the market with inexperienced operators focused solely on profit.

They blamed recent pharmacy closures on low consumer spending and market oversaturation, rather than restrictive licensing laws.

“An unchecked rise in pharmacies, driven by profit rather than real demand, has led to closures and poor service quality,” the society said in a statement.

Unchecked competition

The group also criticised the 2015 removal of a rule requiring a minimum distance of 250 metres between pharmacies, saying its repeal triggered unchecked competition and left many small operators struggling to survive.

They insisted that stricter regulations are needed, not fewer.

The Pharmacies Owners & Importers Society voiced similar concerns, warning that the local market is already overcrowded, driving many businesses toward bankruptcy due to rising operating costs such as storage fees and reduced profit margins caused by rigid supplier pricing agreements.

Investment

“What we need is investment in pharmaceutical factories and medical laboratories, not more pharmacies,” the society argued, adding that expanding branches would do little to improve public access to medicine while increasing financial strain on the sector.

The Services Committee concluded that removing the branch limit would trigger reckless expansion, with little to stop investors from flooding the market and driving local operators into ruin.

It urged Parliament to reject the proposal entirely, describing it as a direct threat to the sector’s stability and Bahrain’s broader healthcare system.

Article 28 of Decree-Law No. 18 of 1997 was introduced to prevent monopolistic control in the pharmaceutical sector.

Regulatory approval

It restricts individuals and companies from operating more than five pharmacies, with a possible sixth branch allowed only in areas larger than five square kilometres that lack pharmacy services, subject to regulatory approval.

NHRA officials noted that similar rules remain in place in neighbouring countries such as Saudi Arabia, the UAE, and Oman, where pharmacy expansion is tightly controlled to balance market needs with public access.

However, they acknowledged that Bahrain’s smaller market size poses unique challenges, requiring tailored solutions that balance commercial and public health interests.