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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 Department of Health and Social Care (DHSC) has announced adjustments to the reimbursement rates for several Aptamil products dispensed earlier this year, following a pricing error that left pharmacies out of pocket. The changes, which apply to products dispensed between January and April 2024, come after Community Pharmacy England (CPE) raised concerns about discrepancies in the pricing data used by the NHS. The issue stemmed from recent price increases by Nutricia Ltd, the manufacturer of Aptamil, which were not reflected in the NHS Dictionary of Medicines and Devices (dm+d). To address the shortfall, the DHSC has retrospectively increased the reimbursement prices for the following Aptamil products: - Aptamil Anti-Reflux powder (800g): From £14.29 to £16.08 - Aptamil Comfort milk (800g): From £14.29 to £16.08 - Aptamil First milk powder (200ml): From £0.92 to £1.06 - Aptamil Follow On milk (200ml): From £0.92 to £1.06 - Aptamil Lactose Free powder (400g): From £7.70 to £8.39 These changes, effective from January 2024, are intended to ensure that pharmacies are appropriately reimbursed for the cost of these products.

In response to a recent Parliamentary question regarding pharmacy reimbursement, pharmacy minister Stephen Kinnock stated that pharmacies were permitted to retain £850 million from the medicine margin for 2023/24. The medicine margin represents the difference between the product price reimbursed by the National Health Service (NHS) and the price at which pharmacies buy them. Rebecca Smith, the Conservative MP for South West Devon, inquired about the number and proportion of community pharmacies that had dispensed medications at a loss over the past three years. Kinnock replied that they do not hold this information, and explained that community pharmacy reimbursement arrangements "do not aim to ensure that every pharmacy is paid as much or more than it paid for every product, but aims overall to reimburse as much as they were bought for, plus the allowed medicine margin." Additionally, the minister highlighted that as part of the Community Pharmacy Contractual Framework (CPCF) for 2023/24, pharmacies are allowed to retain "£850 million from the medicine margin, on top of what they are paid for the medicines they purchase as part of providing NHS services."

The Department of Health and Social Care (DHSC) will introduce new arrangements for the setting of Drug Tariff Category A reimbursement prices from April 2024. Driven by ministers, DHSC's decision aims to equalise access to margin on Category A medicines and it's part of a series of drug reimbursement reforms proposed by the department following a public consultation in 2019. Currently, prices of medicines in Category A are subject to monthly adjustment. From 1 April 2024, these will be updated quarterly based on sales and volume data obtained by DHSC under the Health Service Products (Provision and Disclosure of Information) Regulations 2018. The transition will conclude in July 2025 when the reimbursement prices will be exclusively determined by the new method. Advance notice for contractors regarding the 'new arrangements' has been outlined on the NHSBSA website. However, Community Pharmacy England (CPE) did not support the introduction of the changes at this time as pharmacies are currently grappling with "wider challenges" and there is uncertainty about the potential impact of these changes on the already "turbulent" medicines supply chain

Pharmacies across Northern Ireland are in financial turmoil, reporting that they are dispensing prescription medicines at a loss due to inadequate reimbursement from the Department of Health (DoH). This crisis has led to the closure of almost a dozen pharmacies over the past 18 months, with many others struggling to stay open. Siobhan McNulty, who runs Melvin Pharmacy in Garrison, County Fermanagh, described the dire situation. "We're dispensing medicines at a loss," she said. "The reimbursement rates don't match the cost of the drugs, and we're left to cover the gap." McNulty relies on sales of non-pharmaceutical products to keep her business running.

The 2025/26 pharmacy contract consultation will include a review of the medicine margin and reimbursement arrangements, health and care minister Stephen Kinnock has confirmed. Kinnock made this statement in response to a written question from Nick Timothy, Conservative MP for West Suffolk, who asked the secretary of state for health and social care, if he will review the reimbursement system for pharmacies and GP practices dispensing medicines. Kinnock stated that consultation with Community Pharmacy England (CPE) for the 2025/26 Community Pharmacy Contractual Framework (CPCF) has started and will include "reviewing the allowance for medicine margin as part of funding, and any further changes to the reimbursement arrangements." However, he clarified that there are currently no plans to review the reimbursement system for general practices (GPs) dispensing medicines. Kinnock said: "Dispensing practices receive a dispensing fee, approximately £2.00 to £2.30 per item, which is intended to cover dispensing costs. "This fee is calculated based on forecasted volumes of prescriptions to be dispensed and the size of the funding envelope, according to a methodology agreed by the Department, the General Practitioners Committee (GPC), NHS Employers, and the Welsh Government."

Patients in Ireland with a specific type of lung cancer can now access Merck's TEPMETKO® (tepotinib) as a second-line treatment option, following its approval for reimbursement by the Health Service Executive (HSE). Tepotinib is the first treatment approved in Ireland specifically targeting advanced non-small cell lung cancer (NSCLC) with mesenchymal-epithelial transition factor gene (MET) exon 14 (METex14) skipping alterations. Previously, the oral MET inhibitor had been approved in the NHS across England, Wales, Scotland, and Northern Ireland. Patients with advanced NSCLC with METex14 skipping alterations typically have poorer overall survival rates compared to other NSCLC patients. According to Merck, tepotinib has shown consistent and durable antitumor activity in this group, as demonstrated in the VISION study, further cementing its role in clinical practice. Roisin Molloy, Managing Director of Merck Healthcare in Ireland, said: "This is an important step forward for targeted treatments in Ireland and it is fantastic news that the HSE has reimbursed tepotinib."

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."

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).

There has been a lot of coverage in the national and pharmaceutical press of the prices being charged to pharmacy owners for certain medicines. Leaving aside the reasons for steep price rises, I have been asked on social media and elsewhere whether pharmacy owners can refuse to supply prescribed medicines if they would make a significant financial loss. Legal obligation The first thing to point out is that the National Health Service Act 2006 imposes a legal duty on the Secretary of State and NHS England to make arrangements for people to receive sufficient prescribed drugs. These arrangements involve the publication of the Drug Tariff. The Drug Tariff includes reimbursement prices or a method for determining prices. Various factors can be taken into account in determining reimbursement prices. The Drug Tariff does not provide a pound for pound reimbursement for medicines that pharmacies supply on NHS prescriptions.

The Department of Health and Social Care (DHSC) has introduced new arrangements for the application of discount deduction to community pharmacy payments which will be implemented in six financial quarters beginning in October 2022 and concluding in January 2024. Under the new discount deduction system, the current single scale will be split into three groups: one each for generic medicines, branded medicines, and appliances. Separate fixed deduction rates have been determined for each group. This will provide all pharmacies the same rates of deduction applied to their reimbursement for the three different groups, regardless of the total value of that reimbursement. Fin McCaul, PSNC member and independent community pharmacy contractor, said: "The discount deduction scale has been a point of contention for contractors for many years, and PSNC has long been pushing to remedy this. "The incoming changes are designed to both improve equity of access to margin and manage the distortions presented by branded medicines, which just don't have the same level of discount available as generics.

The recruitment of pharmacists in Primary Care Networks (PCNs) has exacerbated a general shortage of pharmacists, revealed an independent review of Integrated Care Systems (ICSs) published on Tuesday (4 April). The review, Rt Hon Patricia Hewitt, highlighted the impact that the Additional Roles Reimbursement Scheme (ARRS) roles for pharmacists are having on the community pharmacy sector. "Contracts with national requirements can have unintended consequences when applied to particular circumstances. For instance, the national requirements and funding of Additional Roles Reimbursement Scheme (ARRS) roles for community pharmacists within PCNs, has on occasion exacerbated the problem of a general shortage of pharmacists, with some now preferring to work within primary care rather than remain in community pharmacies or acute hospitals, compounding the problem of community pharmacy closures and delayed discharges." It set out to consider the oversight and governance of ICS in England and the NHS targets and priorities for which Integrated Care Boards (ICBs) are accountable, including those set out in the Government's mandate to NHS England. As part of this work, Hewitt and her team engaged with a wide range of stakeholders representing various local health and social care settings, including LPCs.

Many community pharmacies are under severe financial strain due to chronic underfunding and a mismatch between medicine costs and reimbursement rates. A report by the National Pharmacy Association (NPA) revealed that NHS underpays pharmacies by up to £75 a pack for common medicines, resulting in losses of thousands of pounds each month. The NPA analysis found that, in many instances, NHS funding covers only one-fifth of their purchase costs for medicines. Nemesh Patel, Managing Director of the Southdowns Pharmacy Group, said the current pharmacy funding contract is "completely broken and beyond farcical." Sharing their struggles, he tells Pharmacy Business: "Our teams are wasting hours and hours trying to just source medication for patients when they could be better using that time to clinically support our patients, and then when it comes to reimbursement, the drug tariff prices or concessionary prices are structured such that on hundreds of medications we dispense per month, we will be making a significant financial loss, each and every single time our pharmacies dispense that medication."

Addressing the recent announcement made by the Department of Health and Social Care (DHSC) to claw back £9 million per month from community pharmacy contractors, the Chairman of Numark, Harry McQuillan has expressed deep concerns over the financial implications on the sector. The claw back follows an error in the July calculations of Category M medicine prices, which led to increase in the reimbursements made to community pharmacies. Beginning August, the DHSC is set to claw back the amount. McQuillan criticised the decision, highlighting the severe strain it places on already financially vulnerable community pharmacies. Calling it "a severe blow to an already financially strained sector", McQuillan emphasised that the additional burden has the potential to threaten the viability of many pharmacies. "Community pharmacies are the frontline of our healthcare system, by penalising these pharmacies for an error not of their making, the Department of Health is jeopardising the foundation of local healthcare delivery," McQuillan criticised. Addressing the recent announcement made by the Department of Health and Social Care (DHSC) to claw back £9 million per month from community pharmacy contractors, the Chairman of Numark, Harry McQuillan has expressed deep concerns over the financial implications on the sector. The claw back follows an error in the July calculations of Category M medicine prices, which led to increase in the reimbursements made to community pharmacies. Beginning August, the DHSC is set to claw back the amount. McQuillan criticised the decision, highlighting the severe strain it places on already financially vulnerable community pharmacies. Calling it "a severe blow to an already financially strained sector", McQuillan emphasised that the additional burden has the potential to threaten the viability of many pharmacies. "Community pharmacies are the frontline of our healthcare system, by penalising these pharmacies for an error not of thei

NHS England has reassured that GP Additional Roles Reimbursement Scheme funding will continue in 2025/26, encouraging primary care networks (PCNs) to use it for recruiting recently qualified GPs. In October 2024, updates to the Network Contract DES specification enabled PCNs to claim reimbursement for hiring recently qualified GPs through the ARRS for the remainder of 2024/25. An additional £82 million in funding was also announced to allow PCNs to employ over 1,000 additional GPs. This action is part of the government's strategy to boost long-term GP employment, helping practices offer more appointments for patients and addressing the issue of unemployment among newly qualified GPs. However, NHS England recognised that uncertainty about the continuation of ARRS funding beyond 2024/25 has been a barrier for some PCNs in undertaking recruitment of recently qualified GPs. To address this, Dr. Amanda Doyle, national director for primary care and community services at NHSE, issued an official statement reaffirming the continuation of this funding into 2025/26.

The British Generic Manufacturers Association (BGMA), the trade body for off-patent medicines, has made several recommendations to alleviate medicine shortages, which not only have serious consequences for patients but also increase workloads for pharmacists. England is currently experiencing twice as many medicine shortages as it did two years ago, with some products remaining out of stock for many months, the BGMA reveals in a report, noting that "the vast majority are commonly used generic medicines." "We have witnessed the number of products facing supply challenges double in the past two years and remain at a high level since September 2023," says BGMA chief executive Mark Samuels. In its report titled 'Solutions to UK medicines shortages' published on 1 October 2024, the BGMA proposes policy changes to tackle medicine shortages, including incorporating supply chain resilience and past performance in hospital medicines tenders. "Tender scoring should include whether supply issues were reported with adequate notice. Suppliers should be informed of changes in prescribing more quickly," the report says.

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