DRUG DISTRIBUTORS TO SUE CZECH MINISTRY

The Czech Association of Wholesale Drug Distributors (AVEL) may sue the country's Health Ministry over unpaid debts -- estimated to total CZK2.5bn (EUR88mn) -- from state-run hospitals.

Further, unless the government makes a "public pledge" to pay the bills, or the hospitals repay the debt within 2 weeks, AVEL has threatened to halt delivery of medicines.

Health Minister David Rath has however refused to act under pressure and says the threat amounts to "blackmailing" the state and patients. The Ministry added that it has an alternative supplier but plans to open the contract to an EU-wide tender.

Despite late payments being endemic in Eastern Europe, the Czech health system has been hit hard recently over finance issues. Earlier in February 2006, dentists claimed that they would not sign new contracts with health insurance companies in 2H06 due to delayed payments, and would start demanding cash payments from patients. Doctors have even asked Prime Minister Jiri Paroubek to dismiss Rath over payment directives.