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Dr Bharat Shah CBE regrets that neither community pharmacists nor pharmaceutical wholesalers in the UK have any control over how Category M reimbursement prices in Part VIII A of the Drug Tariff are determined. The co-founder and chief executive of Sigma Pharmaceuticals was speaking at a conference organised by Avicenna in West London on Sunday (March 6). Introduced into the Drug Tariff in April 2005, Category M is used to set the reimbursement prices of over 500 drugs. The Department of Health and Social Care makes the final decision on the amount of reimbursement (cost of drugs and appliances supplied against an NHS prescription form) and remuneration (fees paid as part of the NHS community pharmacy contract for the provision of a service).

The Department of Health and Social Care's (DHSC) response to the 2019 consultation on community pharmacy drug reimbursement reform has paved the way for the second phase of consultation with the pharmacy negotiator. The second round of the consultation will focus on eight proposals: Changes to the way Category A prices are set Changes to how medicine margin is distributed in Category M drugs Changes to how Category C prices are set for drugs with multiple suppliers Inclusion of non-medicinal products in the Drug Tariff Changes to the way prices of drugs in non-Part VIIIA are set Changes to arrangements for reimbursement and procurement of 'specials' Changes to reimbursement of generically prescribed drugs and appliances dispensed as 'specials' Changes to the discount deduction scale The Pharmaceutical Services Negotiating Committee has been discussing these proposals with the DHSC and the outcome was featured in the final package of the 'Community pharmacy in 2016/17 and beyond' document.

The NHS Business Services Authority (NHSBSA) has published the Drug Tariff Category M price list for July which reflects an increase in reimbursement level of approximately £5m per quarter. An adjustment of -£23.8m was announced, in light of the results of the margin survey (latest result up until end of December 2022), and the phasing down of the additional £100m agreed across years 4 and 5 as part of the Community Pharmacy Contractual Framework and uplifts for underlying market prices (between January - March 2023). Community Pharmacy England has agreed the adjustments based on the analysis of margin delivery and on current projections for 2023/24. It said: "The objectives are to ensure full delivery of agreed margin and smooth delivery as much as possible. As always, the impact on individual pharmacies will vary depending on dispensing mix."

Any prescription for Promethazine hydrochloride 10mg tablets x 56 submitted for payment to the NHSBSA for July 2022 will be reimbursed at the new price of £17.77 not as per the price concession of £13.45 announced in the 4th concessions update published on 29 July 2022, said the Pharmaceutical Services Negotiating Committee (PSNC). In July 2022, PSNC received several reports from contractors unable to obtain Promethazine hydrochloride 10mg tablets (56) at the published Drug Tariff price of £4.24. Therefore, it submitted a request for a price concession, which was granted and subsequently published but this was later withdrawn after confirmation from the Department of Health and Social Care (DHSC) that due to the price change mechanism, the reimbursement price for Promethazine hydrochloride 10mg tablets has increased from £4.24 to £17.77 for July 2022. PSNC said, "Following the price change mechanism rules, for generic drugs (excluding drugs in Category M), a price change up to and including the 8th of the month takes effect for prescriptions dispensed in that same month. Any price change after the 8th takes place in the following month."

The Pharmaceutical Services Negotiating Committee (PSNC) has announced the margin delivery rates will increase from October as the agreed £100m write off is implemented. "The baseline margin allowance will remain £800m per year in 2022/23 and 2023/24," said PSNC. "Margin levels in the last two full years (2020/21 and 2021/22), as measured by the Margin Survey of independent pharmacies, were in excess of the baseline allowance, meaning that an excess was accrued." As new services have been introduced and take up of these has accelerated, the amount of unallocated funding left in the CPCF is now less than it previously was. As such, the value of the Transitional Payments will decrease from its current level. Some of the unallocated funding remaining in 2023/24 will be repurposed into a Flat Payment for all contractors (see details below). Over the course of the second half of 2022/23, the value of the Transitional Payments will be phased down. This will start in October 2022 with a reduction in payment levels to approximately 85% of the current level, as shown in the following table: