Oriola-KD eyes 10 pct of Sweden's pharmacies

HELSINKI, Jan 9 (Reuters) - Finnish drugs distributor Oriola-KD (OKDBV.HE) said on Wednesday it would like to run around 10 percent of Sweden's pharmacies, after a report recommended the government ends a 37 year-old state monopoly.

The government-commissioned report, published late on Tuesday, recommended that firms other than state-owned Apoteket be allowed to sell prescription and over-the-counter medicine, provided they apply for licenses.

How much of Apoteket would be sold off, and in what sized chunks would remain to be decided.

"A 10-percent market share would already make a sizeable and meaningful pharmacy chain in Sweden," Oriola-KD's Chief Financial Officer Kimmo Virtanen said.

Landsbanki analyst Robin Santavirta said he estimated the value of the Swedish pharmacy market at 3.5 billion euros ($5.2 billion).

"There are around 900 pharmacies in Sweden and Oriola-KD could be interested in a chain of 100," Santavirta said.

"They have a very strong financial position right now, so 10 percent would be very possible for them."

Oriola's Virtanen said the firm had around 100 million euros in cash which it would use for investments in Sweden.

The Swedish government requested the report to cut prices of drugs and improve access to medicine by letting other players into the market and ending a monopoly held since 1971.

Another report is due to be published in April, but Tuesday's recommendations called for the changes to come into force at the start of 2009.

Oriola-KD, which operates as a pharmaceuticals distributor in Sweden and has a 43 percent share of that market, said it also plans to launch wholesale operations in the Nordic neighbour.

"If there are other players in the market, it's clear that a 40 percent share in the wholesale business would not be available for Oriola-KD, but it will be clearly higher than the 10 percent we expect to have in the pharmacy chains," Virtanen said.

(Reporting by Agnieszka Flak, Editing by Erica Billingham)