Alliance UniChem growth hit by uncertainty
Retail acquisitions relatively slow
June 24 2003
Pharmacy business Alliance UniChem is finding its harder to acquire new retail businesses in its core markets.
In the UK, potential sellers are awaiting the finalisation of the review of pharmacy licensing by the government. This is likely to generate increased competition from supermarket operators, with Unichem hoping to acquire smaller chains and independents facing a squeeze on prices.
However, there have been some indications that steps will be taken to protect the position of smaller operators, leaving potentiall sellers waiting for full details of the review before making a decision.
In the Netherlands, where the industry is awaiting a review of discount clawback rates, there has also been a slowdown in the number of businesses on the market.
In a pre-close statement, Alliance UniChem said its retail businesses have been performing in line with expectations. Growth in wholesale markets in Northern Europe has slowed in the first five months of 2003, partly due to an increased number of generic products on the market. The company said: “While this trend impacts sales growth, we are able to counter this by leveraging our buying power.”
Southern European wholesale markets have been growing slightly ahead of expectations, “however these markets continue to prove difficult, with margins being impacted by a combination of regulatory, competitive and economic pressures.”
Overall, Alliance Unichem expects growth in line with expectations. The company is one of the UK’s largest retail pharmacy operations with almsot 800 Moss outlets and more than 7,250 independent pharmacy customers.
