13 January

HEALTHCARE

Incompatibility of pharmacy ownership and care home management: the issue is put before a Plenary Session of the Council of State

13/01/2022

In its non-definitive judgement no. 8634 of 27 December 2021, the Council of State referred to the Plenary Session of the Council of State the decision whether or not a company owning a pharmacy which is, in turn, owned in full by another company concerned with medical care represents an instance of incompatibility under art. 7, paragraph 2 of Law no. 362/1991, according to which ownership of shares in companies owning a pharmacy “is incompatible with any other business in the field of production of pharmaceuticals, providing of scientific information on pharmaceuticals, or the exercise of the medical profession”. After recalling that the incompatibility preventing pharmacy owners from conducting medical activities, as “motivated by the conflict of interest that results from simultaneously ‘prescribing’ and ‘dispensing’ medications”, “aims to safeguard the public interest in proper performance of the pharmaceutical service and, in the final analysis, the primary interest in protection of the public health”, the Administrative Courts noted the existence of two instances in the presence of which the circumstance of incompatibility may be considered to extend to pharmacies owned by subsidiary companies, and that is, if the parent company may be said to be: a) involved in the “operation” of the pharmacy, and b) exercising the “medical profession”. With reference to the first of these circumstances, the decision under examination considered it necessary for the Plenary Session to intervene, as it was necessary to establish whether the presumption of direction and coordination of the company owning the pharmacy, attributable to the parent company under articles 2359 and 2947 sexies of the civil code, may be considered sufficient to make the latter effectively or actively “involved in the operation of the pharmacy”. As for the second case, the Council of State took the view that it must be taken into consideration that a care home is not a company of medical professionals, as it simply organises and operates care homes, availing itself of the work of physicians, who work as independent professionals and do not entrust their decisions and responsibilities to others, and the circumstance that the physicians present in the shareholding structure of the care home hold positions (as partner or member of the board) entirely separate from their medical work, not allowing them to transfer to the company the distinctive features of their profession. In addition, we must remember that the regulations dictated by Law no. 362/1991 extend the condition of incompatibility only to partners in the company owning the pharmacy, not to the partners or directors of the company owning shares in the company that owns the pharmacy. The consequences that may result from a more or less extensive interpretation of the condition of incompatibility and the general relevance of the case at hand have therefore led the Council of State to put the decision before the Plenary Session in order to avoid the risk of possibly conflicting decisions.