Expenditure and Spending Trends

The Bulgarian pharmaceutical and medical goods market has experienced robust growth in recent years. In 2023, pharmaceutical sales reached around €2.7 billion, reflecting a post-pandemic surge of nearly 15% year-on-year. This growth was driven partly by increased demand for innovative therapies, with oncology medications leading the development, especially in the hospital sector. Overall health expenditure in Bulgaria remains modest in per capita terms – at about €1,708 per person (2021), it is less than half the EU average – yet pharmaceutical spending consumes a disproportionately large share. About 32% of total health expenditures go toward pharmaceuticals and other medical goods, one of the highest shares in Europe (the EU average is ~18%). This reflects both high medicine utilization and relatively low total health spending.

Total pharmaceutical and medical goods expenditure has trended upward. The pharmaceutical sector contributes roughly 2.2% of Bulgaria’s GDP. According to industry forecasts (IQVIA data), pharmaceutical sales have risen steadily from the mid-2010s and are projected to continue growing through 2029. Bulgaria’s pharmaceutical sales (2015–2029f) show consistent growth, underlining the market’s expansion. Medical devices form a smaller market – Bulgaria has one of the smallest medical device markets in the EU – but this segment is also growing at a mid-single-digit annual rate. Medical goods (including prescription drugs, over-the-counter (OTC) products, and devices) together have seen increased allocation in health budgets. For example, the National Health Insurance Fund (NHIF) budget for medicines, medical devices, and dietary foods in 2023 was set at around USD 946 million, a 16.75% increase from the prior year. This indicates strong public spending growth on pharmaceuticals.

Spending patterns

Bulgaria’s health expenditure is heavily oriented towards medicines and inpatient care. Around 40% of health spending is on hospital care (vs 28% EU average), and around 32% on outpatient medication and devices, as noted. By contrast, shares for preventive care and long-term care are very low. The high share for pharmaceuticals reflects both the extensive use of medicines and pricing levels that, while low relative to Western Europe, still constitute a significant burden in Bulgaria’s lower-income context. Notably, many expensive therapies (e.g., oncology drugs, biologics for autoimmune diseases) have driven recent spending increases. Oncology is a top therapeutic area by expenditure, given the growing availability of costly cancer treatments and rising cancer burden. Other high-spend areas include cardiovascular disease (high prevalence in the population), diabetes and endocrinology, and immunological or rare disease treatments. In volume terms, widely used chronic medications (for hypertension, cholesterol, etc.) dominate, but these are often lower-cost generics. By value, innovative drugs for cancer and chronic conditions make up a growing share of the market.

Public vs Private Financing and OOP Burden

Healthcare in Bulgaria is financed by a mix of public funds (primarily the NHIF’s social insurance) and private payments. Public expenditure has increased in recent years, but Bulgaria still has one of the lowest public funding shares in the EU. As of 2021, only about 65% of health spending was publicly financed, versus an EU average above 80%. Consequently, out-of-pocket (OOP) spending by patients is extremely high. Approximately 34–36% of total health expenditure comes directly from households – the highest OOP share in the EU. This heavy OOP burden is driven mainly by spending on pharmaceuticals. More than two-thirds of outpatient medicine costs in Bulgaria are paid by patients out-of-pocket. This is in stark contrast to the EU average, where medicines are much more commonly covered by insurance.

High OOP costs for medicines reflect Bulgaria’s limited coverage and reimbursement levels. Many medicines are only partially reimbursed or not covered at all by the NHIF, leaving patients to pay the remainder. Even for covered drugs, co-payments can be significant if the NHIF does not fully cover the price. For instance, chronic disease medicines not on the 100% reimbursement list may be reimbursed at 50% or 75%, with the patient paying the balance. Moreover, some segments – such as most OTC products and vitamins, and medicines for minor acute issues – are typically paid entirely out-of-pocket. These patterns have led to OOP spending on medicines far above European norms, raising concerns about affordability and access.

Private financing also stems from voluntary health insurance, though that plays a minor role (voluntary insurance accounts for only a few percent of health spending). The vast majority of private expenditure is direct household payments. Notably, informal payments (under-the-table payments to providers) have historically been an issue in Bulgaria, though their incidence has declined somewhat (by 2022, around 6% of people reported making informal payments). Still, the combination of formal and informal out-of-pocket costs means Bulgarian patients bear a heavy financial burden for healthcare. Pharmaceutical expenditures are a key contributor: government sources covered only 27% of total pharmaceutical spending in 2019, with the rest mainly OOP. This heavy reliance on private payment undermines financial protection and can limit access to necessary medicines for lower-income and uninsured groups.

On a positive note, public spending on health has been slowly rising. The share of public financing rose by about four percentage points from 2019 to 2021. The government’s health budget for 2023 exceeded USD 5 billion, with an NHIF fund of USD 4 billion to cover insured services. Efforts are underway to increase the health insurance contribution rate or government subsidy, as stakeholders warn that underfunding of the public pharmaceutical budget could threaten patient access. Still, Bulgaria’s health expenditure at ~8–9% of GDP remains below the EU average, so significant out-of-pocket spending will likely persist without major policy changes. The high OOP burden is recognized as a challenge, with the pharma industry and patient groups calling for better reimbursement to relieve patients. Addressing this issue is crucial for improving equity in the healthcare system.

Market Access and Reimbursement Pathways

Regulatory bodies

Several institutions govern market access for medicines. The Bulgarian Drug Agency (BDA) is the national regulator for medicinal products and medical devices, overseeing marketing authorizations and pharmacovigilance. New medicines (especially prescription drugs) must be authorized via the European Medicines Agency (for centrally authorized products) or by the BDA for national authorizations. Once a medicine is approved, if the manufacturer seeks public reimbursement, a separate process begins. The National Council on Pricing and Reimbursement of Medicinal Products (NCPRMP) is the key body that evaluates and decides on including medicines in the Positive Drug List (PDL) – the list of products reimbursed by the NHIF. The Ministry of Health (MoH) issues ordinances guiding reimbursement criteria (e.g., which diseases/conditions are covered) and oversees the overall policy. Still, the NCPRMP and NHIF handle the technical evaluation and negotiations.

Reimbursement process

To be reimbursed by the NHIF, a medicine must be listed on the PDL maintained by the NCPRMP. The inclusion process involves multiple steps designed to ensure cost-effectiveness and budget impact control:

• Health Technology Assessment (HTA): Bulgaria has an HTA committee that reviews clinical and pharmacoeconomic evidence for new therapies. This committee issues an expert report on the therapeutic value and cost-effectiveness of the product as a basis for reimbursement decisions. The HTA evaluation is the first step for innovative medicines entering reimbursement. However, the HTA process has often been lengthy, contributing to delays in access to new drugs; only a small fraction of novel EU-approved drugs were reimbursed within a year of approval.
• Pricing determination: In parallel, the maximum allowable price of the medicine is determined (see Pricing section below for details on price-setting). The NCPRMP uses external reference pricing and other rules to set the ceiling price and calculates a reference reimbursement price per therapeutic class (usually based on the lowest-priced alternative in the same INN/form). For each drug seeking reimbursement, the council establishes a reference value (often based on Defined Daily Dose or similar unit) and then determines the reimbursement rate.
• Reimbursement level assignment: Bulgaria employs a tiered reimbursement level system. Medicines are grouped by therapeutic area and significance. The NHIF will reimburse up to 100% of the reference price for medicines treating severe chronic conditions that cause high disability or mortality (e.g., many oncology drugs, insulins, antiretrovirals). Drugs for high-prevalence chronic diseases (like hypertension, diabetes) might be set at 75% reimbursement, and less critical or symptomatic treatments at 50%. Some categories may have intermediate rates as defined by the MoH ordinance. The reimbursement level combined with the reference price per pack yields the maximum NHIF payment; the patient must pay any excess above that or any co-pay percentage.
• Discount negotiations: A crucial step is the negotiation of discounts (managed entry agreements) between the NHIF and the marketing authorization holder. Bulgaria has instituted a system where pharmaceutical companies must offer rebates to the NHIF for their products to be listed. Each year, the NHIF conducts a centralized negotiation for rebates on reimbursed medicines. By law, the main rebate should be at least 10% of the NHIF’s expenditure on that product each quarter. In practice, many innovative drug manufacturers provide significant confidential rebates or paybacks to secure reimbursement, helping to contain the budget impact. These negotiated rebates effectively reduce the net price paid by NHIF below the list price.
• Decision by NCPRMP: After HTA assessment and successful price/rebate negotiation, the NCPRMP makes the final decision to include the medicine in the Positive Drug List. The decision is published, and the drug becomes reimbursable under NHIF for the approved indications/conditions. If a drug is denied or delayed, patients can only access it through out-of-pocket purchase or special programs. There have been concerns about slow uptake of new therapies. As of 2018, only a small percentage of innovative drugs were quickly reimbursed in Bulgaria, indicating a lag in access compared to Western Europe. This is gradually improving due to pressure from patient groups and EU-wide initiatives, but market access timelines remain longer than the EU average.

Medical devices and nutraceuticals

Reimbursement pathways for medical devices differ. Specific medical devices (e.g., insulin pumps, hearing aids, and some consumables) are reimbursed either by NHIF or the MoH, but only if they are included on a specific list maintained by the BDA. The NHIF runs an annual procedure to set reimbursement reference prices for device categories and invites suppliers to offer products within those price limits. Suppliers whose price bids are within the NHIF’s set value can then negotiate rebates, after which the NHIF finalizes the reimbursed device list and prices for the year. Devices not on the list (or any costs above the reimbursement cap) must be paid out-of-pocket or via hospitals. As for nutraceuticals and food supplements, these are generally not reimbursed by NHIF. They are regulated as food products, and consumers purchase them privately. The nutraceuticals market in Bulgaria is relatively small and dominated by local companies and imports of vitamins, herbals, and sports supplements. While growing due to health-conscious trends, supplements remain outside public insurance coverage.

Financing and coverage limitations

It’s important to note that the NHIF benefit package defines which conditions are covered for free or subsidized treatment. The NHIF Supervisory Board issues a list of conditions for which medicines (and certain medical foods) are reimbursed. If a medicine is on the PDL but prescribed for a non-covered indication, it may not be paid for. Conversely, some high-cost treatments for severe illnesses are fully covered but often subject to protocols or specialist prescription requirements. Bulgaria’s benefit package guarantees coverage for essential therapies (e.g., cancer chemotherapy, some pediatric chronic disease meds), but more “lifestyle” or mild condition drugs might not be covered. The government has also undertaken specific programs – for instance, providing certain vaccines or infertility treatment medications – via separate budgets.

In sum, market access for pharmaceuticals in Bulgaria involves navigating a complex but well-defined reimbursement system that includes HTA, strict pricing controls, mandatory rebates, and tiered coverage levels. Companies often face extensive negotiations and must accept price concessions to enter the market. This can delay the availability of the latest treatments but helps ensure the sustainability of the NHIF budget. Recent reforms aim to streamline this process and expedite access, but challenges remain (as discussed later under Policy Changes and Outlook).

Legal and Regulatory Framework

Bulgaria’s pharmaceutical sector operates under a framework aligned with EU legislation but also shaped by national policies focused on cost containment. Key components of the legal and regulatory setup include:

Medicines Act and EU integration

The core law governing pharmaceuticals is the Medicinal Products in Human Medicine Act, which incorporates EU directives on drug authorization, manufacture, and distribution. Since joining the EU, Bulgaria has adhered to EU standards for quality, safety, and efficacy. For example, it recognizes EMA approvals and follows Good Manufacturing Practice standards (the U.S. FDA even recognizes BDA for GMP inspections). While the regulatory framework on paper meets EU norms, implementation can diverge in areas like market access and pricing, where national rules apply.

Pricing regulations

Bulgaria enforces strict price controls on medicines. All prescription drugs, whether reimbursed or not, are subject to a regulated maximum price set by the NCPRMP. Bulgaria uses an external reference pricing (ERP) system referencing a basket of EU countries (including low-price markets like Romania and Latvia, and larger markets like Italy and Spain). By law, the manufacturer’s ex-factory price in Bulgaria cannot exceed the lowest price of the product in any of the reference countries. This effectively often sets Bulgarian drug prices at or near the lowest in the EU.

Reimbursement and formulary rules

The Positive Drug List is governed by criteria set in the NHIF’s pharmaceutical formulary rules. Every newly listed drug must fit within budget impact limits, and cheaper alternatives (generics, biosimilars) are preferred. The NHIF regularly updates the PDL (monthly revisions are allowed for price changes or new entries). The reimbursement status of a drug is reviewed at least every three years to ensure continued rationale, and prices are re-referenced annually. There are special regulations for orphan drugs and vaccines to facilitate their inclusion, but budget constraints still apply. For example, orphan medicines might undergo a more straightforward HTA process, yet still require negotiated discounts due to high cost.

Clawback and payback mechanisms

A notable element of the legal framework is the clawback (pay-back) mechanism introduced to keep public pharmaceutical spending within budget. Each year, the NHIF Supervisory Board approves a mechanism to ensure NHIF’s drug expenditure does not exceed the law-defined budget. If spending on reimbursed medicines goes above the set annual budget, pharmaceutical companies must refund the excess to the NHIF. Essentially, manufacturers collectively (and individually, pro rata to their sales) bear responsibility for overspending. The law stipulates that Marketing Authorization Holders (MAHs) pay back the amount by which their products’ reimbursement costs overshoot the budget. This “hidden pharma tax” or clawback has been contentious – industry groups argue it threatens the viability of companies and discourages new product launches. Indeed, U.S. trade representatives have voiced concern in 2025 that Bulgaria’s heavy clawback and pricing rules act as a barrier to market access, potentially prompting trade measures. Alongside clawbacks on medicines, a similar mechanism exists for medical devices: if device spending exceeds budget, the NHIF will reduce reimbursement prices paid to suppliers accordingly (effectively lowering payments to meet the cap).

Recent reforms and laws

The legal framework has undergone frequent amendments. The reimbursement legislation has been characterized as “unstable” due to constant changes in recent years. Some recent or ongoing reforms include the introduction of Real-World Data (RWD) monitoring, a 2023 policy that now requires the collection of real-world effectiveness data for some innovative drugs (especially oncology) to inform future reimbursement decisions. An AI-driven platform (the “Danny Platform”) is being implemented to analyze hospital treatment data and outcomes for expensive therapies. The goal is to move toward outcome-based evaluations and pricing in the future. Another legal update is e-prescribing (discussed later) mandated since mid-2021 for all reimbursed medicines, which required changes in the prescribing and pharmacy regulations. Additionally, Bulgaria’s laws were amended in 2023 to address medicine shortages (creating a monitoring system and imposing stricter reporting and export bans, see Procurement section).

Institutional roles

The NHIF is established as an independent public institution (separate from the MoH) by the Health Insurance Act. Its budget and policies (like the annual NHIF Act) are passed by Parliament each year. The MoH, however, still plays a role via issuing ordinances (e.g., defining which diseases get 100% reimbursement) and through funding specific programs (like emergency care, transplant medications, vaccines for the uninsured, etc.). There is also a National Health Strategy guiding reforms (the current strategy runs through 2030), which sets goals for pharmaceutical policy such as increasing generic use, improving access to innovative drugs, and optimizing hospital pharmacy services.

EU Pharmaceutical Package: Secure Access vs National Control

In 2023–2024, the European Commission launched a major overhaul of its pharmaceutical legislation—known as the “Pharma Package.” Its goals: boost equitable access to medicines across the EU, reinforce supply security, reduce regulatory burdens, and enhance environmental sustainability. Key elements include:

• Access Conditionality: Proposals tie regulatory data protection (RDP) incentives to continuous supply in all EU Member States—rewarding firms that ensure availability everywhere. Member States may even invoke financial penalties for non-compliance.
• Shortage Mitigation: The new framework mandates categorizing shortages (e.g., critical, non-critical) and obliges marketing authorization holders to have shortage prevention plans and to notify authorities.
• Equitable Supply List: The “Union List of Critical Medicines” (270+ molecules across therapeutic areas) will operate alongside national critical medicine lists to prioritize supply security.

The Critical Medicines Act (March 2025)

This complementary regulation specifically targets supply vulnerabilities by:

• Strengthening availability standards and diversifying supply chains for critical medicines and medicines of common interest—those with insufficient access in at least three Member States.
• Introducing reporting, stockpiling, and transparency requirements for industry.
• Encouraging EU-based manufacturing and streamlining coordinated procurement (e.g., joint tenders) with budget support for strategic projects.

What This Means for Bulgaria

• Cautious Acceptance: Bulgaria maintains complete alignment with EU pharmaceutical regulation in areas like market authorization and quality standards. The country has signaled willingness to implement new laws, but prefers flexibility to retain national control over pricing and procurement decisions—particularly in recognizing that switching procurement criteria could strain budgets.
• Industry Expectations: Local pharmaceutical stakeholders (especially generics and domestic manufacturers) see opportunity in EU initiatives that incentivize domestic production and streamlined procurement. These could enhance Bulgaria’s manufacturing competitiveness and reduce reliance on imports.

Bulgaria’s Dual Approach

Bulgarian law remains anchored in EU legislative frameworks—but with a stronger national emphasis on cost containment (via external reference pricing, reimbursement caps, and clawback). The country manages inflation-driven price pressures and market volatility through reporting mandates and anti-export measures.

As the Pharma Package and Critical Medicines Act move forward, Bulgaria is likely to accept supply and shortage rules while safeguarding its fiscal and procurement control. Still, new EU-driven incentives may catalyze broader domestic production, deeper integration in joint tenders, and a more resilient supply chain—setting up a more balanced future between fiscal sustainability and patient access.

Procurement Models and Supply Channels

The mechanisms of procuring and supplying medicines differ between the outpatient (community pharmacy) sector and the hospital sector, each with its own models and challenges:

Outpatient reimbursement model

Most prescription medicines for ambulatory patients are dispensed through retail pharmacies and reimbursed by the NHIF if covered. Patients obtain a prescription from a doctor (often an electronic prescription now) and fill it at a pharmacy of their choice. Pharmacies then claim reimbursement from the NHIF for the covered portion of the drug cost. The NHIF uses a unified information system for these claims. Prices in the outpatient setting are governed by the national price decision (drugs cannot be sold above the approved price), and co-payments are determined by the reimbursement rate (0%, 25%, 50% or 100% coverage). Pharmacies are required to sell at or below the fixed retail price – patients pay any co-pay, and the NHIF pays the rest directly to the pharmacy.

Significantly, the NHIF’s outpatient drug budget operates effectively as an open item with the clawback ensuring it stays on track. Companies supply wholesalers/pharmacies, and if overall NHIF spending on a product exceeds projections, the payback mechanism recovers the excess from the manufacturer. In recent years, outpatient drug spending has been rising due to expanded coverage of some medicines (e.g., more therapies added for full reimbursement) and growing utilization. The NHIF’s 2023 budget for medicines (nearly BGN 1.8 billion, i.e. ~$950 million) includes outpatient drugs and some high-cost therapies provided via pharmacies. Within this, certain costly drugs (like oncology or rare disease treatments) might be dispensed by specialized pharmacies or hospital pharmacies, but still reimbursed via NHIF outpatient budget lines.

Hospital procurement

For inpatient care, hospitals procure medicines and medical devices primarily through tender or negotiated contracts, since inpatients receive medications as part of hospital treatment (DRG or clinical pathway payments cover those costs). Public hospitals must follow public procurement law for purchasing medicines: they typically run tenders for their annual or periodic needs. In some cases, groups of hospitals or the MoH might conduct centralized tenders for high-cost medication (for example, cancer drugs, vaccines, and blood products have at times been procured centrally to get better prices). The Ministry of Health itself runs centralized procurement for specific programs and emergency stock.

Funding for hospital medicines comes from the NHIF’s hospital payment budget (hospitals get reimbursed for clinical pathways) as well as direct MoH programs for specific disease areas. If a medicine is on the NHIF Positive List and used in a hospital, its cost is effectively reimbursed via the hospital’s contract with NHIF. However, issues arise when expensive therapies exceed hospital budgets – hospitals have sometimes accumulated debts to suppliers. The government has occasionally intervened to pay off hospital pharmaceutical debt or to ensure the supply of critical hospital drugs.

A particular challenge in Bulgaria has been drug shortages in hospitals, especially for oncology medications. In 2022 and 2023, shortages of some key prescription and cancer drugs were reported. These were attributed to a combination of factors: manufacturers withdrawing products due to low prices (commercial unsustainability), logistics and parallel export issues, and procurement inefficiencies. To combat this, the MoH in late 2024 streamlined import procedures for 40 critical oncology medicines, making it easier for hospitals to source them quickly. Additionally, new legislation in 2023 introduced a Specialized Electronic System for Monitoring medicine availability. Marketing authorization holders and parallel importers must report available quantities weekly, and wholesalers daily, for drugs that are reimbursed. Suppose the national availability of a drug falls below 65% of the needed monthly volume (based on average consumption). In that case, it triggers a designation of “shortage,” enabling authorities to ban exports of that medicine until the shortage resolves. This mechanism is aimed at preventing local supply from being depleted by parallel trade or other disruptions.

Rebate System and Managed Entry Agreements

As noted, the NHIF negotiates rebates with manufacturers as part of listing agreements. These operate as a sort of confidential discount or payback on sales. In some cases, performance-based agreements exist (for example, if a drug doesn’t meet specific outcomes, additional rebates apply). However, Bulgaria has only recently started exploring outcome-based MEAs through its RWD initiative. Most rebates are simple financial arrangements (e.g., pay NHIF X% of revenue each quarter). The standard rebate is at least 10%, but can be higher for big-budget drugs.

Role of NHIF vs MoH in procurement

The NHIF is the single payer for insured health services and generally does not directly procure goods – it reimburses providers. However, for outpatient drugs, NHIF effectively “purchases” from pharmacies by reimbursement, and it negotiates prices via rebates. The Ministry of Health handles procurement for some items not covered by NHIF. For example, vaccines for mandatory immunizations, certain high-cost medicines for rare diseases or off-formulary use, and emergency stockpile medications are usually bought by the MoH through tenders with funding from the state budget. The MoH can also step in with special procurement when market failures occur (e.g., if no supplier provides a needed drug, the MoH might organize importation).

Medical device procurement

Similar to drugs, hospitals procure devices (like imaging equipment, implants, consumables) via tenders. The NHIF reimburses specific devices used in ambulatory care (for example, some orthopedic or cardiac implants used in procedures) up to a fixed amount. Patients requiring devices may need to contribute if the device price exceeds the NHIF’s reference price. The MoH may run centralized tenders for expensive equipment for hospitals (with EU funds or national funds). A trade-off exists where limited budgets mean not all needed devices are reimbursed, and patients may pay privately for newer technologies.

In summary, Bulgaria’s procurement model is a mix of regulated market transactions with intensive oversight and post-purchase clawbacks. The outpatient system functions via private pharmacies but under strict price/reimbursement rules and later reconciliation (rebates). The hospital system uses tenders, but low prices and distributor market power can lead to supply issues. The government’s recent measures (like the shortage monitoring system and allowing emergency imports) are attempts to buttress the supply chain. There is also discussion of more radical solutions to improve access in underserved areas, as discussed next (e.g., vending machines and state-supported pharmacies).

Distribution and Supply Chain

The pharmaceutical distribution chain in Bulgaria involves domestic manufacturers, importers, wholesalers, and a network of pharmacies and drugstores. Key features of the supply chain include consolidation at the wholesale and retail levels, concerns about vertical integration, and initiatives to improve access in rural areas:

Manufacturers and importers

Bulgaria has a small local pharmaceutical manufacturing base, focused mainly on generic drugs and some nutraceuticals. The largest domestic manufacturer is Sopharma, a long-established company producing generics, OTCs, and some original products; Sopharma is also a major exporter in the region. Other local manufacturers include smaller firms and contract manufacturers. Many of the advanced or innovative medicines are imported by the regional subsidiaries of multinational companies or by specialized importers. As an EU member, Bulgaria is part of the common market, so pharmaceuticals approved in the EU can be imported freely (subject to the pricing rules). The Bulgarian Drug Agency issues wholesale licenses and monitors the quality of imported medicines.

Wholesalers

The wholesale distribution segment is moderately consolidated. A few big wholesalers dominate, including international players. Sopharma Trading (affiliated with Sopharma) is one of the largest distributors, which has also expanded into retail pharmacy in recent years. Other major wholesalers likely include branches of global groups (such as Phoenix Pharma, which operates in Bulgaria, and Alliance Healthcare historically) and local companies like Sting AD, MedEx, etc. Wholesalers supply both pharmacies and hospitals. They must comply with EU Good Distribution Practice and are monitored by the BDA. One issue that arose in recent years is parallel trade – Bulgaria’s relatively low medicine prices make it a source for parallel exporters who buy medicines in Bulgaria and sell them in higher-price EU markets. This can exacerbate local shortages. The government’s shortage prevention system now requires wholesalers to report stocks and prohibits exporting drugs that are in shortage domestically. Still, managing parallel export has been challenging, and some manufacturers have resorted to allocating limited quantities to Bulgaria because of this.

Pharmacy network

Medications reach patients primarily through pharmacies. As of 2024, about 3,200 pharmacies are operating in the country, down from over 4,200 in 2015. This decline indicates some consolidation and closure of small outlets. The pharmacy sector is highly fragmented, but with growing groups. The largest pharmacy group is Apteka Mareshki, with over 300 pharmacies across 120 towns. Mareshki’s chain, known for aggressive discounting, is owned by a businessman-turned-politician and was among the first to consolidate the market. Besides Mareshki, there are around 14 other smaller groups, including some franchise models like Seiba/Sanita (now part of Sopharma Trading’s retail arm). Foreign chains (such as Dr. Max or others prevalent in Central Europe) have not significantly entered Bulgaria yet. However, some regional players (like “DM” as franchise networks) are present. The majority of pharmacies remain independent community pharmacies.

Pharmacies must be licensed, pharmacist-owned (in principle), although chain structures often involve corporate ownership behind the scenes. Vertical integration is an ongoing concern: wholesalers like Sopharma Trading owning pharmacy chains raises competition issues, as noted by observers. The Competition Protection Commission keeps an eye on dominance abuse, but vertical integration “remains an issue” in the market. This could potentially lead to preferential supply or the squeezing out of independent pharmacies.

Drugstores and online sales

In addition to full pharmacies, Bulgaria has around 900 drugstores, which are retail outlets allowed to sell non-prescription medicines and health products (but not prescription drugs). Drugstores and 130 licensed online pharmacies serve the OTC and supplement market. Online pharmacy is growing, especially for OTC and wellness products. Still, prescription drugs can only be sold online by licensed pharmacies, and only OTC medicines can be delivered (prescription drugs require in-person dispensing due to verification of prescriptions and patient identity).

Access in rural areas

A notable challenge is ensuring pharmacy services in small or remote communities. Many villages and small towns lack a resident pharmacy, as low population and low profit margins have led to closures. To address this, in 2023–2024, policymakers have introduced the idea of medicine vending machines and mobile pharmacies. An amendment to the Medicinal Products Act in early 2024 now allows pharmacy operators to install vending machines dispensing OTC medicines in places with no pharmacy. These machines can provide basic drugs (pain relievers, fever reducers, digestive aids, etc.) 24/7 in underserved localities. The aim is to improve access for residents in remote areas. However, pharmacists’ associations have opposed state-funded vending machines, arguing that this could undermine pharmacy jobs and safety. Despite protests, the initiative is moving ahead, with some municipalities (like Blagoevgrad) already piloting medication kiosks. Additionally, there have been proposals for the state to subsidize pharmacies in poor or remote regions to keep them operational (e.g., paying for a pharmacist in a small town), and even ideas of mobile pharmacy units.

Supply chain reliability and shortages

As mentioned, supply disruptions have been an issue. In 2024, 152 medicines had their marketing authorizations suspended/withdrawn in Bulgaria because companies deemed them commercially unsustainable at Bulgarian prices. These withdrawals particularly hit essential categories like oncology drugs, immunosuppressants, cardiovascular drugs, NSAIDs, analgesics, hormones, and antibiotics. Patients and physicians have reported frequent difficulties finding certain medicines, leading some to seek medications abroad or resort to unofficial sources. The Bulgarian Association for Medicines Parallel Trade Development (BAMPTD) logged 2,700 reports of out-of-stock medicines in one year. The government’s response has included (as noted) an export ban list and bureaucratic simplifications for importing scarce drugs. Still, without addressing root causes (low pricing and small market size), shortages remain a risk. The parallel export ban on certain medications (e.g., some diabetes medicines and children’s antibiotics) has been in place for over a year, but authorities acknowledge this is a stopgap measure.

Distribution efficiency

While Bulgaria’s small market size presents challenges, the distribution infrastructure is relatively modern. The presence of big players like Sopharma Trading and Phoenix ensures a nationwide reach. Specialized units of these wholesalers handle cold chain and specialty distribution (for biologics, etc.). Pharmacies are well spread in urban areas (Sofia, Plovdiv, Varna have many), but rural coverage is thin – hence the interventions above. The trend of consolidation is expected to continue, with larger pharmacy chains acquiring smaller ones. This could bring efficiencies and standardization (e.g., chains can negotiate better with wholesalers and offer lower prices to patients), but also raises competition issues and could impact independent pharmacists.

In summary, Bulgaria’s pharma supply chain is characterized by a few dominant distributors, a fragmented but consolidating pharmacy sector, and ongoing efforts to secure medicine availability. Vertical integration, parallel trade, and rural access are key themes. The government and industry stakeholders are actively seeking solutions (like vending machines, export monitoring) to ensure that medicines reach all patients who need them despite the market’s structural challenges.

Key Players in the Pharmaceutical Market

Despite its small size, the Bulgarian pharmaceutical market hosts a mix of local and international players across manufacturing, distribution, and retail:

Domestic Pharmaceutical Companies

The flagship local manufacturer is Sopharma AD, one of Bulgaria’s oldest and second-largest drug makers. Sopharma produces a broad portfolio of generic medicines (from analgesics to cardiovascular drugs) and some original products (notably plant-based medication). It is a significant exporter and also owns Sopharma Trading, a major wholesaler and pharmacy operator. Other local manufacturers include Biovet (focusing on veterinary and some human APIs), Bulgarian Rose (phytochemicals), Actavis (formerly with manufacturing in Bulgaria – Actavis’s facilities now part of Teva’s network), Tchaikapharma, and several smaller generic firms. Local production covers primarily generics, OTC products, and nutraceuticals, valued at around $376 million annually. The domestic industry contributes about 2.2% to GDP and provides jobs and tax revenue. However, many advanced drugs are not produced locally.

International Pharma Companies

All major multinational pharmaceutical corporations are present via subsidiaries or distributors. Leading research-based pharma firms active in Bulgaria include Pfizer, Roche, Novartis, Merck & Co. (MSD), Johnson & Johnson (Janssen), AbbVie, Eli Lilly, Amgen, Sanofi, GSK, AstraZeneca, Bristol Myers Squibb, among others. Many of these have local offices handling marketing, regulatory, and market access activities. Some also run clinical trials in Bulgaria (as of 2024, nearly 800 trials were ongoing, indicating an attractive environment for research). While these multinationals supply innovative medicines, they often face the challenges of low pricing and small market volume in Bulgaria, which sometimes leads them to delay launches or withdraw certain products. Nonetheless, innovative oncology, immunology, and cardiovascular drugs from these companies constitute a growing part of the market by value.

Generic and Regional Companies

Beyond Big Pharma, generic-focused international companies also have a strong presence. Teva (which acquired Actavis/Watson) has a sizable portfolio and production legacy in Bulgaria (operates the Dupnitsa manufacturing site). Sandoz (Novartis generics), Krka and LEK (from Slovenia), Zentiva, Alvogen are all active. These companies compete in the tender and retail markets for generics. In the past, Balkan Pharma (facilities inherited by Actavis and others) was once a key local name. Indian and other Asian generic firms reach Bulgaria through distributors as well.

Wholesalers

The top distributors have major influence on the supply chain. Sopharma Trading is a leading wholesaler (with an estimated market share of 20% or higher). Phoenix Pharma (part of the German Phoenix group) is another dominant wholesaler. Sting AD is a large Bulgarian-owned distributor. Libra and Distrib Pharma are other players. Typically, a few wholesalers cover most of the market, ensuring nationwide distribution to pharmacies and hospitals. They compete with pharmacies on service and discounts. Some wholesalers, like Sopharma Trading, have vertically integrated (owning retail chains), while others partner with independent pharmacies (for example, Phoenix supports franchise networks like BETTY pharmacies in Bulgaria).

Retail Pharmacy Groups

Mareshki Pharmacy (Apteka Mareshki) grew rapidly by offering medications at lower margins, forcing competitors to lower prices. With 300+ outlets, it’s the largest pharmacy group. Sopharmacy, associated with Sopharma Trading (created by acquiring Ceiba, Sanita, and PharmaStore), has about 200 pharmacies. Other notable groups include Subra and franchise networks like Apteki 36.6. Many of these are much smaller (dozens of pharmacies). The retail market, although consolidating, still has a long tail of single independent pharmacies.

Key Industry Associations

The interests of pharmaceutical companies are represented by groups such as ARPharM (Association of Research-Based Pharmaceutical Manufacturers), which has 24 international pharma company members. ARPharM is the local EFPIA member and engages with the government on policy, pricing, and intellectual property issues. There is also a Bulgarian Generic Pharmaceutical Association (representing generic manufacturers, including domestic ones). Additionally, the Association of Bulgarian Pharmaceutical Manufacturers might exist for local producers. For multinational generics and biosimilar companies, some are part of ARPharM, while others coordinate informally. The Association of the American Pharmaceutical Industry in Bulgaria (AmPharMA) focuses on U.S.-headquartered companies, working in parallel with ARPharM. On the wholesaler side, there’s a Bulgarian Association of Pharmaceutical Wholesalers, and for parallel traders, the BAMPTD mentioned earlier. Each of these lobbies is on relevant regulations (for example, parallel traders against export bans, research-based companies against aggressive price cuts, etc.).

Foreign Investment and Manufacturers

Bulgaria has attracted some foreign investment in pharmaceutical manufacturing in the past (Actavis had manufacturing here, Bayer produces some active substances via an acquired plant, etc.). The sector’s growth potential, combined with low costs, is seen as an opportunity; indeed, the government has expressed hope that the EU’s drive for more European-based production might lead to new manufacturing investments in Bulgaria. The country’s upcoming Eurozone entry in 2025 and improving business climate could further encourage investors. Key players to watch in manufacturing include any new entrants building capacity (though none significant have been announced as of 2024).

In the medical devices arena, many global medtech companies operate through distributors (e.g., Medtronic, Philips, Siemens Healthineers, Johnson & Johnson Medical). There is an industry association called the Bulgarian Medical Technology Industry Association (MedTech Bulgaria), bringing together device manufacturers and distributors.

To summarize, the Bulgarian pharma landscape comprises a strong generic/traditional base (Sopharma and others), a full array of multinational innovators (present but selective in their portfolio offering due to economic constraints), powerful distribution intermediaries (wholesalers like Sopharma Trading and Phoenix), and a retail sector in flux with emerging chains. Collaboration and conflict coexist: for instance, ARPharM and the government sometimes clash on pricing policy (as seen in the clawback debate), whereas local manufacturers collaborate with authorities on export promotion. The key players collectively shape market dynamics, from the availability of products to policy directions for the sector.

Professional and Patient Organizations

Several professional bodies and patient advocacy organizations influence Bulgaria’s healthcare, including the pharmaceutical domain:

• Bulgarian Medical Association (BMA): The national physicians’ association, representing doctors. BMA negotiates the National Framework Agreement with NHIF each year, influencing service pricing and indirectly the use of medicines (e.g. by agreeing on clinical pathways, etc.). The BMA often advocates for higher health funding and has supported measures like increasing the health insurance contribution.
• Bulgarian Dental Association: Represents dentists, similarly involved in negotiating dental care coverage with NHIF.
• Bulgarian Pharmaceutical Union (BPhU): This is the professional guild of pharmacists. It oversees pharmacy practice standards and ethics. The BPhU is a key stakeholder in any pharmacy-related legislative changes. For example, the union has been vocal against allowing medicine vending machines, citing patient safety and professional concerns. They also advocate for addressing pharmacy shortages in rural areas and for better reimbursement of pharmacy services.
• Association of Pharmacy Owners: Separate from the professional union, pharmacy owners sometimes organize (including chain owners like Mareshki) to lobby on business interests – for instance, on markup regulations or the ability to open new pharmacies freely (there are no location restrictions in Bulgaria, leading to heavy competition in cities).
• Bulgarian Association of Pharmaceutical Wholesalers: Represents the distribution companies. They coordinate with regulators on topics like anti-counterfeiting measures (Bulgaria implemented the EU Falsified Medicines Directive verification system) and logistics issues. They have also been involved in discussions on ensuring continuous supply and the impacts of parallel trade restrictions.
• ARPharM (Association of Research-based Pharmaceutical Manufacturers): As noted, it includes international innovative pharma companies. ARPharM engages with the government on policies such as pricing, reimbursement, intellectual property, and clinical trials. For instance, ARPharM has called for increased public funding for innovative drugs and warned against heavy clawback taxes that could deter new medicines. They also promote ethics and transparency (adopting EFPIA codes).
• BG Pharma and Health Care Association: This might be an umbrella for domestic pharma producers and possibly healthcare service firms. They typically push for supportive policies for local industry (such as state incentives or protection from parallel exports).
• Patient Organizations: Bulgaria has an active patient advocacy community. The National Patients’ Organization (NPO), founded in 2010, is the largest umbrella group, encompassing dozens of individual patient associations. NPO is officially recognized by the MoH as a representative body and is consulted on health policy decisions. It works to defend patient rights, improve access to therapies, and raise awareness of various conditions. Under the NPO umbrella are groups focused on diseases like cancer, diabetes, rare diseases, and others. For example, the Bulgarian Association for Patients’ Defense is an NGO advocating for patient rights in treatment decisions. Disease-specific groups, such as the Bulgarian Cancer Association, Diabetes Association, Association of People with Asthma (ABBA), and Rare Disease Organizations (like for thalassemia, Gaucher, etc.), are all part of the health landscape. These organizations often campaign for inclusion of new drugs in the NHIF reimbursement list and for legislative changes (for instance, patient groups strongly supported the initiative to provide free medicines for children).
• Professional associations in specialties: There are also specialist physician associations (e.g., cardiology society, oncology association) that sometimes influence prescribing guidelines or advocate for resources in their field. For example, oncologists have highlighted the need for better cancer drug funding in light of Bulgaria’s high cancer mortality.
• Other Stakeholders: The Bulgarian Nurses Association represents nurses, addressing workforce issues that indirectly affect patient care. The Bulgarian Association of Health Professionals encompasses allied health professionals. While these may not directly shape pharmaceutical policy, they contribute to broader healthcare system advocacy, such as calls for increased healthcare budgets.

Collaboration between these groups is variable – sometimes they unite on common causes (e.g., all would support higher health spending), while other times their interests differ (pharmacists vs. doctors on certain prescribing privileges, etc.). A recent example of multi-stakeholder action is the push to raise the health insurance contribution (“health tax”) by the Bulgarian Doctors’ Union to cover system deficits – presumably supported by hospital and patient groups worried about underfunding. On the other hand, when the government proposed the children’s free medicines policy, professional reactions were mixed: patient organizations applauded it as relieving financial burden on families, whereas some pharmacists raised concerns about implementation and potential irrational drug use increase.

Professional bodies (doctors, pharmacists) and patient organizations play significant roles in Bulgaria’s healthcare environment. They serve as both partners and critics to the government and NHIF – providing expertise, negotiating terms of care, and voicing the needs of patients. Their engagement is crucial for any successful health policy or reform, including those related to pharmaceuticals and market access.

Therapeutic Areas with Highest Expenditure and Volume

While a comprehensive breakdown is complex, certain therapeutic areas in Bulgaria stand out for high spending or high utilization:

• Oncology: Cancer treatments constitute one of the highest expenditure categories. Oncology drugs, particularly newer immunotherapies and targeted therapies, have seen rapid uptake and budget impact. By 2023, oncology was reportedly the leading segment driving pharmaceutical sales growth. Many oncology medications are fully reimbursed given the severity of the disease, but their high prices mean they take up a large share of NHIF’s drug budget. Also, shortages of some oncology drugs in hospitals have made headlines, underlining their criticality. The government has prioritized cancer care improvements (e.g., more funding for oncology centers, speeding import of critical drugs), so oncology spend will likely continue rising.
• Cardiovascular Diseases: Cardiovascular drugs (for hypertension, heart disease, stroke prevention) are among the most widely used, reflecting Bulgaria’s high cardiovascular morbidity. Although many are cheap generics, the sheer volume (millions of prescriptions for ACE inhibitors, beta-blockers, statins, etc.) makes CV the largest category by volume of doses dispensed. By expenditure, it is moderate due to generic competition, but still significant due to the need for lifelong therapy for a large population. Notably, some newer CV therapies (like PCSK9 inhibitors or novel heart failure drugs) have limited uptake, partly to contain costs. However, common drugs for blood pressure and cholesterol are staple items with extensive use.
• Diabetes and Endocrine: Antidiabetic medications form a high-spend group, especially with rising diabetes prevalence. Insulins and newer anti-diabetic drugs (such as GLP-1 analogues or SGLT2 inhibitors) are reimbursed and in growing use. Insulins are fully covered for insulin-dependent diabetics. Bulgaria has also faced issues ensuring a continuous supply of some diabetes meds, even banning parallel export of certain insulins when shortages loomed. The spending on diabetes drugs is driven by the cost of modern insulins and the expanding use of combination therapies for Type 2 diabetes.
• Autoimmune and Inflammatory Diseases: Treatments for rheumatoid arthritis, psoriasis, and inflammatory bowel disease (largely biologic drugs like TNF inhibitors, interleukin inhibitors, JAK inhibitors) have become a notable expenditure area. These biologics are expensive and often fall under NHIF’s special protocols with budget caps. The rheumatology budget analysis showed biologics dominated that segment (over 99% of the rheumatology drug budget) and continued to grow. However, biosimilars have entered (for drugs like adalimumab, etanercept), helping mitigate costs. Still, autoimmune biologics are among the top drivers of NHIF drug spending after oncology and diabetes.
• Central Nervous System (CNS): CNS medications (including those for neurological conditions and mental health) are commonly used, though many (antidepressants, epilepsy drugs, etc.) are generic. One area of spending is multiple sclerosis – newer MS therapies can be high-cost and are funded for a limited number of patients. Psychiatric medications in outpatient care are covered partially (some anti-psychotics are fully reimbursed for severe cases). Overall, CNS drug spending is moderate, but the prevalence of mental health issues means volume is significant (even if many pay out-of-pocket for newer antidepressants not fully covered).
• Anti-infectives: Antibiotics are widely used (sometimes overused). Most antibiotics are inexpensive generics, but the volume is high. Recently, the government’s plan to fund free antibiotics for young children (discussed below) highlights both the volume of use in that group and a policy move to reduce barriers to treatment. Hospital anti-infectives (like some antifungals or critical antibiotics) can be costly and sometimes in short supply (especially with global supply issues).
• Rare Diseases and Others: There is a portion of the budget allocated to rare disease treatments (e.g., enzyme replacement therapies, cystic fibrosis drugs). These affect a few patients, but the costs are incredibly high per patient. The NHIF and MoH have a list of such treatments that are funded, often through separate programs. Their overall share of spend is small but growing as new therapies emerge (e.g., new gene therapies or specialized drugs may need to be considered in the coming years).

In terms of volume of medicines consumed, the most commonly used medications in Bulgaria are similar to those elsewhere: pain relievers (analgesics and NSAIDs), cardiovascular drugs, antibiotics, and gastrointestinal remedies. Indeed, analgesics and NSAIDs were among those seeing withdrawals due to low profitability, which indicates how prevalent but low-cost they are. OTC categories like analgesics, cold and flu meds, and vitamins also sell in high volumes over the counter.

To provide an overview: chronic non-communicable diseases (cardio, diabetes, respiratory) account for the largest share of prescriptions, while oncology and immunological drugs account for the largest share of spending. Bulgarian health authorities monitor which areas drive costs. For example, they note high cancer mortality and want to invest in better cancer treatment, but also must manage the ballooning oncology drug budget. Similarly, large-scale national programs exist for cardiovascular disease prevention and diabetes, which involve medication use but also aim to reduce complications (which can indirectly curb spending growth).

In summary, Bulgaria’s pharmaceutical consumption profile reflects its epidemiological profile: high rates of cardiovascular and metabolic diseases result in huge volumes of those medications; meanwhile, modern therapies for cancer and severe chronic conditions consume a growing chunk of funding. The health system’s task is to ensure rational use – e.g., avoid antibiotic overuse (important as free pediatric antibiotics become policy) and support prevention – so that medication spending translates into better health outcomes.

Current and Upcoming Policy Changes

The 2024–2025 period is seeing several policy developments that will impact the pharmaceutical market, in areas of pricing, reimbursement, and access:

Free Medicines for Children

A flagship new measure in Bulgaria’s 2025 health policy is the introduction of free prescription medicines for children up to 7 years of age, covering antibacterial products and medications for the home treatment of acute infectious diseases. The legal foundation for this initiative is set out in § 18 of the Law on the NHIF Budget for 2025 (Article 1(2), item 1.1.3.5.3.2), which mandates 100% NHIF reimbursement for eligible medicines starting 1 July 2025.

Under the law, medicines must be included in the Positive Drug List (PDL) via the procedures in Regulation No. 10/2009 on pricing and reimbursement, and approved by the National Council on Prices and Reimbursement of Medicinal Products (NCPRMP). To operationalize the measure, the NHIF Supervisory Board has approved a list of 117 qualifying diagnoses for which these medicines will be reimbursed in full.

The initiative was formally endorsed by the Parliamentary Budget and Finance Committee in March 2025, with BGN 20 million allocated in the NHIF budget to fund the policy. The stated rationale is to ease the heavy out-of-pocket burden on families, reduce financial barriers to pediatric care, and prevent complications from untreated infections.

However, the rollout has faced practical challenges. On the planned start date of 1 July 2025, implementation was delayed because no manufacturers had yet signed supply contracts with the NHIF under the agreed reimbursement terms. This lack of initial participation raised concerns about availability, echoing earlier warnings from industry that commercially unattractive conditions might discourage suppliers.

Despite these obstacles, the measure represents a significant shift in the financing burden for pediatric care, aligning with broader government priorities to improve child health outcomes. There are also discussions about potentially expanding the policy to cover older children or additional therapeutic categories—such as chronic disease medications for pediatric patients—though no legislative steps have been taken yet.

Healthcare professionals and public health experts have cautioned that while improving access is critical, making antibiotics free could inadvertently increase over-prescription, potentially worsening antimicrobial resistance. Consequently, the Ministry of Health and NHIF are expected to pair the policy with prescribing guidelines, monitoring systems, and public awareness campaigns to promote rational use.

Expanded Preventive and Diagnostic Services

The MoH has been incrementally broadening the scope of covered preventive care. In 2022 and again in 2024, the NHIF benefits package was expanded to include more preventive examinations and tests for children, adults, and pregnant women. This includes earlier diagnostic screenings (for example, additional ultrasound or lab tests at certain life stages) to catch diseases sooner. At the same time, not directly pharmaceutical, better diagnostics can affect the pharma market by identifying patients who need treatment. There’s also a focus on improving early diagnosis of childhood diseases, which ties into ensuring medications (like those for treatable genetic conditions) can be given promptly. Furthermore, there is a national program under discussion to improve access to modern diagnostics (e.g., genetic testing for cancer patients to guide therapy), potentially funded by the state. If implemented, such programs could increase the appropriate use of high-cost targeted medicines by ensuring patients are correctly identified.

EU Pharmaceutical Legislation Impact

The EU’s pharmaceutical strategy and proposed new regulation (expected to be finalized around 2024/25) will have implications for Bulgaria. Key aspects include shorter regulatory exclusivity periods and incentives for launch in all EU markets. If adopted, companies would have to launch medicines in small markets like Bulgaria within a specific time to enjoy complete IP protection. This could greatly benefit Bulgarian patients, as it would reduce the current lag where some drugs come to Bulgaria only years after EU approval. Bulgarian authorities and ARPharM are closely following this; Bulgaria generally supports measures that push companies to include poorer EU markets early.

Additionally, the EU Critical Medicines Act (to secure the supply of essential drugs) might provide frameworks and funding that Bulgaria can use to bolster local production or stockpiles. Bulgaria has paused some national plans pending these EU developments. For instance, a large €50 billion healthcare investment strategy to 2030 was put on hold in 2024, possibly awaiting alignment with EU funding streams. Once clarified, that strategy (which includes modernizing hospitals and laboratories) could resume, indirectly impacting pharma usage (e.g., new oncology centers using more advanced therapies).

Hospital Sector Changes

The government signaled possible changes in how hospitals can procure medicines. Historically, private hospitals in Bulgaria were limited in procuring high-cost drugs (often they had to source through the same rules as public hospitals). There was debate on allowing private hospitals more leeway or including them in state tenders for better prices. Also, a proposal in 2023/24 to allow hospitals to negotiate directly with manufacturers for certain pricey medicines (rather than standard tenders) was floated, aiming to obtain additional discounts or risk-sharing deals. This is part of a broader hospital reform discussion that includes consolidating hospital networks and improving efficiency.

Pricing and Reimbursement Reforms: No radical changes to Bulgaria’s pricing system have been officially adopted in 2024, but debate is intensifying. The pharmaceutical industry continues to press for reforms to the clawback mechanism and the external reference pricing (ERP) model, arguing that the current approach is unsustainable and discourages timely launches of new medicines. By mid-2025, these concerns had drawn international attention, including from U.S. trade officials, who flagged Bulgaria’s pricing and reimbursement rules in broader bilateral discussions. One external factor now being watched closely is the potential adoption of a Most Favoured Nation (MFN) pricing framework in the United States. While the details and likelihood of an MFN rule remain uncertain, if implemented in some form, it could have indirect consequences for Bulgaria by linking U.S. reimbursement levels to the lowest prices in reference countries, which often include low-price EU markets like Bulgaria. This could further discourage manufacturers from maintaining low list prices in Bulgaria or accelerate product withdrawals to avoid global price spill-over effects.

Domestically, the government has indicated willingness to review the pay-back formula, with options such as capping the industry’s total clawback contribution at a fixed percentage of sales, or exempting certain life-saving medicines from pay-back obligations to ensure availability. Another potential reform under discussion is a differentiated approach to ERP, possibly removing countries with significantly lower GDP from Bulgaria’s reference basket, thereby allowing slightly higher ceiling prices for innovative medicines. No firm decisions have been taken, but any eventual changes will aim to balance cost control with the need to attract and retain access to new therapies. Changes would seek to strike a balance between controlling costs and attracting new therapies.

Clawback Refinements: In late 2024, an idea was introduced to modulate clawback by product type – e.g., lower clawback for generics (to encourage their availability) and higher for expensive brands. Generics and biosimilars makers have argued that charging them the same payback rate as high-priced innovators is unfair, given that they already save the system money. The Health Ministry was reportedly analyzing this differentiation.

Digitalization and E-Health: Building on the successful rollout of e-prescriptions (discussed below), Bulgaria is expanding its National Health Information System. By 2024, electronic health records will be implemented, and there will be movement toward electronic patient referrals and digital sick notes. For the pharmaceutical field, one change is the introduction of an electronic pharmaceutical dossier for each patient – essentially a record of all medicines dispensed to them via NHIF. This helps doctors see a patient’s medication history and avoid duplication or interactions. It also allows NHIF to analyze prescribing patterns. Another digital project is an integrated e-platform for clinical trials to encourage international studies; this could make it easier for Bulgarian patients to access cutting-edge therapies through trials and for companies to manage trial logistics.

Children’s and Maternal Health Initiatives: Besides free kids’ meds, another policy is providing a fuller package of pregnancy and childbirth services free for uninsured women. This includes necessary medications during pregnancy for those women. Also, discussions around expanding the list of illnesses for which children under 18 receive free treatment (including medicines) are on the table, especially for chronic conditions like juvenile diabetes or asthma. Currently, these are covered by NHIF, but with co-pays for some drugs.

Vaccination and Preventive Meds: There is a push to improve vaccination rates by possibly making some recommended (not just mandatory) vaccines free of charge via NHIF. For example, flu vaccines for seniors were subsidized in recent flu seasons. Also, post-COVID, the state has maintained a stock of COVID-19 therapeutics and vaccines at no cost to patients, which is a new element in the pharmaceutical provisioning landscape.

All these changes and proposals indicate a system in flux: the trajectory is towards easing access (free meds for vulnerable groups, more prevention, digital facilitation) while also grappling with cost containment (clawback, tender tweaks). The political will for health reform is present, but execution takes time. It’s worth noting that Bulgaria had political instability with multiple elections 2021–2023, which delayed some health reforms. By 2025, with a hopefully stable government and euro adoption on the horizon, healthcare (including pharma policy) is a priority in the policy agenda to improve the country’s generally poor health indicators.

Digitalization in Healthcare

Bulgaria has made significant strides in digitalizing its healthcare system in recent years, and the pharmaceutical sector has benefited from these innovations:

• National Health Information System (NHIS): Bulgaria is rolling out a comprehensive NHIS that integrates various healthcare data. This includes e-prescriptions, e-referrals, hospital records, lab results, etc. For pharmaceuticals, one benefit is that prescribing physicians can see if a patient has filled their previous prescriptions (improving adherence monitoring). The NHIS also supports the Electronic Medical Records, which can list patient medications, helping to avoid dangerous drug interactions by alerting doctors and pharmacists if an incompatible drug is prescribed or dispensed. The Health Ministry is continuing to add functionalities to the NHIS in 2024/25, aiming for a fully interoperable system covering all insurers and providers.
• Electronic Prior Authorization: For certain expensive medications that require NHIF approval (such as cancer therapies or rare disease treatments that need a commission’s protocol), the process is being digitized. Instead of patients carrying paper protocols, an e-authorization is recorded in the system, which pharmacies can verify. This reduces delays in patients obtaining meds once approved and cuts administrative hassle.
• Telemedicine and E-consultations: Although not yet widespread, the pandemic has spurred some use of telemedicine. Legal changes now allow for remote consultations and even remote prescribing in some cases (for example, doctors can issue an e-prescription after a phone or video consult for a known patient). This is especially useful in rural areas or for follow-up of chronic patients. It ties back to pharma in that it can increase medication continuity – patients are less likely to skip refills if they can consult their doctor remotely to get a new prescription.
• Pharmacovigilance and IT: The BDA has adopted digital tools for adverse drug reaction reporting. Healthcare professionals and patients can submit ADR reports online through a portal, and this data helps monitor drug safety. Similarly, the BDA uses an IT system to manage drug approvals and variations, which streamlines keeping product information up-to-date.
• Medicines Verification System: In line with EU regulations, Bulgaria implemented the barcode scanning system in pharmacies to verify the authenticity of medicines (part of the Falsified Medicines Directive). Pharmacies scan the 2D barcode on each medication pack to ensure it’s legit. This system is fully electronic and connected to the European Medicines Verification Organization’s database. It protects against counterfeit drugs entering the supply chain.
• Data Analytics: With e-prescribing data, the NHIF and Ministry can analyze trends in prescribing and utilization. This supports evidence-based policy. For instance, data might show regional variations in antibiotic use, informing targeted antimicrobial stewardship programs. Also, the new RWD initiative mentioned uses hospital treatment data to assess real-world outcomes of expensive drugs. Over time, these analytics could lead to more refined reimbursement decisions (like pay-for-performance agreements where a drug’s continued reimbursement at a price might depend on outcomes achieved in Bulgarian patients).
• Patient Access to Information: Patients can now check their health records and prescription history online via a citizen portal (with appropriate login credentials). They can see which prescriptions were filled under their name, which can help them manage their medications better. There are also SMS notification services – for example, patients get a text when an expensive medicine protocol is approved, or reminders for preventive check-ups.
• Next steps in digital health: Bulgaria plans to introduce e-vaccination records and integrate them with the prescription system (some vaccines are given in GPs’ offices but documented digitally). Also under development is an electronic system for medical device tracking. From 2025, it’s expected that implanted devices (like artificial joints, stents) will be logged in a registry, improving post-market surveillance and recalls.

Overall, digitalization has been a bright spot in Bulgaria’s health reforms, enabling greater efficiency and transparency. E-prescribing, in particular, has been widely adopted by doctors and pharmacists following initial adjustments, and it demonstrated its value during the COVID-19 pandemic by reducing the need for in-person visits for prescription renewals. This digital progress also lays the groundwork for more advanced initiatives, such as e-dispensing kiosks or integration with EU digital health records, in the future. Challenges remain (ensuring cybersecurity, extending broadband to all rural practices, and training older doctors in IT systems), but the momentum is strong. The continued focus on e-health is both an opportunity (for better care coordination) and a necessity (given limited human resources, digital tools help bridge gaps).

Risks and Opportunities for Market Access and Investment

The Bulgarian pharmaceutical market presents a mix of challenges (risks) and potential opportunities, especially from a market access and investment perspective:

Risks and Challenges

• Sustainability of Pricing and Profitability: Bulgaria’s drug prices are among the lowest in Europe due to external reference pricing and mandatory discounts. For pharmaceutical companies, this creates razor-thin margins, raising the risk of products being withdrawn (which has already happened for over 150 medicines in 2024). Commercial unsustainability is a genuine concern – if a product’s revenue doesn’t justify keeping it on the market, companies may stop supplying it. This leads to shortages and loss of therapeutic options for patients. The continued strictness of the pricing policy, including the heavy clawback (which industry calls a “hidden tax”), is a risk to the market’s attractiveness. Innovative drugmakers might deprioritize Bulgaria for launches, and generic companies may focus on other markets if they cannot cover costs here.
• High Out-of-Pocket Barrier: From a market access viewpoint, patients’ limited ability to pay can hinder uptake of therapies. Bulgaria’s highest OOP share in the EU (around 34% of health spending) means that even if a drug is available, many patients may not be able to afford their portion. For investors or companies counting on volume growth, this is a constraint. High co-pays can result in therapy non-adherence or low market penetration for newer drugs, which is a risk for public health and business.
• Political and Economic Uncertainty: Frequent political changes have created an unpredictable policy environment at times. Reforms can stall or reverse with changing governments. For example, if the coalition changes, the clawback might be increased, or other austerity measures could be introduced quickly. Additionally, macroeconomic factors like inflation (which spiked in 2022) pose risks: if production and import costs rise but price increases are tightly controlled, companies face losses. Bulgaria’s plan to adopt the euro in 2025 should eliminate currency risk (the lev is pegged to the euro anyway), but it will require careful transition in pricing (all prices will convert to euros; any rounding issues or perception of price “hikes” will be sensitive politically).
• Regulatory Delays: The slow uptake of innovative medicines due to protracted HTA and negotiation processes poses a risk to health outcomes and the country’s attractiveness for pharma investment. If patients cannot access the latest standard of care, mortality and morbidity remain high (e.g., cancer survival in Bulgaria is among the worst in the EU). From the industry side, lengthy procedures and uncertain reimbursement timelines reduce the incentive to launch products. This can also deter clinical trials or early access programs, as companies prioritize countries with quicker market access.
• Healthcare System Capacity: Bulgaria struggles with healthcare workforce shortages (e.g., a critical shortage of GPs was reported in 2024). This can limit the uptake of therapies – if there are not enough specialists to diagnose and treat patients (for instance, not enough endocrinologists to manage all diabetics on new drugs), the market for those drugs stays underdeveloped. Also, infrastructure issues, such as a highly hospital-centric system but under-resourced outpatient care, mean care patterns might not be optimal for modern therapeutic approaches (like day therapies or home-based treatments requiring good outpatient networks).
• Parallel Trade and Supply Instability: As noted, parallel export can cause supply issues, and measures like export bans, while necessary, are a reactive approach. Until Europe-wide solutions or better alignment of prices happen, Bulgaria will face the risk of medicines flowing out to higher-price markets, especially during shortages. This adds uncertainty for hospitals and pharmacies in sourcing drugs consistently.

Opportunities and Positive Developments

• Market Growth Potential: Despite low per capita spending, the Bulgarian pharma market is growing faster than many peers (double-digit growth in 2023) and is expected to outpace the regional average in the coming years. This growth is fueled by rising incomes (leading to higher healthcare spending), population aging (driving volume, as seen with ~10% annual growth in pharmacy drug sales aided by an aging population), and government commitments to boost health budgets. For investors, this means there is an expanding pie, and companies already in the market could see rising sales volumes, especially if public financing continues to increase its share.
• EU Integration and Funding: Bulgaria stands to benefit from EU funding programs and initiatives. Through the EU’s Recovery and Resilience Facility, Bulgaria has earmarked investments for healthcare digitalization and possibly for building capacity in areas like vaccines or biotech. If the EU’s new pharma legislation forces earlier drug launches in all countries, Bulgaria could see improved access, which in turn expands the market for new products. Additionally, Bulgaria’s location and cost advantages might attract EU-supported manufacturing (for example, building facilities for essential medicines production as part of the EU’s resilience strategy). The 2025 adoption of the euro may also reduce transaction costs and currency risks, making it more straightforward for multinationals to do business in Bulgaria.
• Underserved Needs & Investment Opportunities: Several therapeutic areas and segments in Bulgaria are underdeveloped, presenting growth opportunities. For instance, preventive medicine (like vaccines, as Bulgaria’s vaccine uptake is low – companies could work with authorities to improve this, expanding vaccine markets). Biosimilars are another opportunity, as many biologics come off patent. Introducing biosimilars in Bulgaria could be beneficial, as their uptake saves costs and frees up budget for increased volume, making them a viable option for companies specializing in biosimilars. Similarly, nutraceuticals and OTC (including the CBD OTC segment) sectors are growing as health awareness increases, offering investment potential for consumer health companies to expand in Bulgaria’s pharmacy retail space.
• Digital Health and Innovation: Bulgaria’s advancements in e-health infrastructure make it a fertile ground for digital health solutions. Companies offering telehealth services, medication adherence apps, or data analytics may find pilot opportunities. The government’s interest in real-world evidence collection could open doors for collaborations on outcome-based agreements – e.g., an innovative pharma company could propose a pay-for-performance scheme supported by Bulgaria’s data systems, setting a precedent for the region. The presence of a well-educated IT workforce in Bulgaria (it’s known for tech talent) also means health tech startups or investments in health IT for pharmacies/hospitals can flourish.
• Improving Regulatory Environment: While challenges exist, the trend is that Bulgaria is gradually aligning more with EU best practices in regulation. The fact that the BDA is recognized for GMP inspections and that clinical trial processes are being streamlined (790 trials ongoing indicates a friendly environment, making Bulgaria attractive for research investment and early product experience. If Bulgaria continues to modernize its HTA and reimbursement decision-making – possibly speeding it up and making it more predictable – it becomes a more attractive early-launch market in CEE, not just one to cover later.
• Healthcare Infrastructure Upgrades: There’s recognition that Bulgaria’s healthcare outcomes need improvement, which implies political will to invest. For pharma, this can mean more money being allocated to medications as part of improving care (e.g., funding new programs for chronic disease management that include drug therapy optimization). The halted large healthcare investment plan, if revived, could lead to new hospitals or expansions with better facilities to use advanced therapies (like radiotherapy centers that also administer expensive oncology drugs, etc.). Each such development potentially increases the capacity to deliver modern treatments, expanding the market.

Key Bulgarian Government bodies, Agencies, and Organizations

Investors in Bulgaria’s pharma market must navigate a challenging environment of low prices and high cost sensitivity. Businesses can leverage the country’s growth momentum, improving policy landscape, and unmet medical needs. Successful market access will likely require creative approaches – such as risk-sharing agreements (with limitations and narrowed administrative capacity), patient access programs (PAPs), and strong real-world data justifications – to convince payers to adopt new therapies. The reward for overcoming these hurdles is a growing market with less competition than in saturated high-income markets. If Bulgaria continues on its reform path, reducing out-of-pocket burden and integrating with broader EU systems, the pharmaceutical market in the country could become significantly more attractive.