Group items tagged

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."

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

The 8th Pharmacy Business Conference, organised by Pharmacy Business, unfolded a dynamic narrative around the theme of 'Pharmacy of Tomorrow', highlighting the trajectory of innovation, adaptation, and the evolving landscape of pharmaceutical services. Attended by over 200 pharmacy owners, industry leaders, and stakeholders, the conference served as a medium for robust discussions and the exchange of valuable insights regarding the future of community pharmacy. Amidst the persistent challenges posed by an underfunded reimbursement system and negotiations with governmental bodies and the NHS for the new community pharmacy contractual framework 2024/25, the conference pivoted towards investing in staff, adapting to change by investing in new technology, and optimising commissioning as pivotal strategies. "Pharmacy professionals are playing increasingly important clinical roles in both primary and secondary care," shared David Webb, Chief Pharmaceutical Officer (CPO), NHS in a video message. He highlighted the NHS's commitment to empowering community pharmacy, with plans to expand services and deprescribe to align with the NHS's focus on preventive healthcare.

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 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."

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."

Pharmacy First has demonstrated the enormous value of community pharmacy in providing accessible front-line care. However, pharmacists continue to face several challenges in delivering the service. "Pharmacy First is a success, but it needs proper support to reach its full potential," said Numark chairman Harry McQuillan. In the first year alone, community pharmacies in England delivered an incredible 2 million consultations, highlighting the vital role pharmacists and their teams play in supporting the NHS. "This significant number shows the high demand for accessible healthcare and the trust patients place in their local pharmacy teams. It's clear that when empowered, community pharmacy delivers," McQuillan told Pharmacy Business. Key challenges in providing the service While Numark members have embraced Pharmacy First, McQuillan pointed out several challenges that persist: "Workforce capacity continues to be a concern, with patient demand sometimes outpacing available resources. "The administrative burden, particularly around IT interoperability, data capture, and reimbursement processes, adds complexity." "Additionally, some geographical areas are still struggling with public awareness, meaning more work is needed to ensure patients understand when and how they can access Pharmacy First."

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 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.

"If the Government does not support community pharmacies with the relevant funding, then we will see a massive number of closures," warns Dr. Leyla Hannbeck, chief executive of the Independent Pharmacies Association (IPA). The Fight4Pharmacies campaign, led by the IPA, is urging prime minister Rishi Sunak to address a critical £1.2 billion funding shortfall that threatens the survival of independent pharmacies across the UK. This urgent plea comes as 1,000 community pharmacies have closed since 2019 due to rising operational costs and insufficient reimbursements. On May 21, supporters of the Fight4Pharmacies campaign, along with 50 MPs including prominent figures like Priti Patel and Gavin Williamson, delivered a petition to Downing Street. The petition, Prescription to Save Our Pharmacies outlines how independent community pharmacies can be supported to ensure smooth running of pharmacies.

harmacists in the town of Barnoldswick in Lancashire are reportedly suffering from various problems including a lack of medicines and the movement or loss of pharmacy staff. Problems, including delays with supply of insulin, were reported at a recent Pendle Council West Craven meeting. And this week the head of one pharmacy chain, Whitworth, highlighted a range of issues faced by his teams including supply chains, costs, loss of staff and NHS reimbursement for contractors. In Barnoldswick, queues have formed inside and outside pharmacies as people attempt to get prescriptions. Some said they had to wait for days to get what they needed, had made repeat-visits to pharmacies and were unsure when medicines might arrive. They also said the number of pharmacies in the area have fallen over the years. Two town centre pharmacies, Whitworth and Well, are located opposite each other, close to a doctors' surgery. Standing in one queue outside Whitworth was Marilyn King. She said: "I have been waiting seven days to get my prescription for blood pressure and some other medicines. This week, I've come back time after time. But the staff say sorry, they have not got it in because nobody has delivered it. "I came here on Saturday, when there was a queue. But the pharmacist was not here. I came again on Tuesday and then Wednesday. Then finally, just when I reached the front of the queue, they asked me to come back in an hour…

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 (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.

Parliamentarians continue to highlight the serious challenges faced by community pharmacists, calling for increased support for the sector. On Wednesday, January 8, during Prime Minister's Questions, Marie Goldman, Liberal Democrat MP for Chelmsford, drew attention to the issue of pharmacies dispensing medications at a loss. Goldman cited the case of a pharmacy owner in her constituency who is 'sometimes forced to pay over 100 times more' for a particular mental health drug than the contract reimburses. Dipak, the pharmacy owner, has been serving his community since opening his pharmacy in 1991, often greeting patients by name. However, he is now struggling to keep his business afloat as his NHS contract no longer covers the cost of the drugs he dispenses. "Dipak is dipping into his life savings to keep the pharmacy afloat. I am sure many other pharmacies are doing the same," Goldman stated. She asked the prime minister whether he agreed that "no pharmacist should be forced to use their own money to keep their pharmacy viable."

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.

In many cases, a pharmacy's most valuable asset is its NHS contract. This is what buyers are paying for - the right to provide pharmaceutical services commissioned by the NHS and be reimbursed for the medicines dispensed. However, a pharmacy consists of more than just an NHS contract and when buyers look for a pharmacy to buy, they will also examine these other areas - the pharmacy's customer base, its staff, the property it operates from - to name a few - because these are all also crucial to a successful pharmacy. In this day and age, another important consideration is the pharmacy's intellectual property (IP) i.e. the pharmacy's rights to certain types of information, ideas, and forms of expression. At the most basic level, this includes the trade mark in the name of the pharmacy, because all pharmacies will have a name by which they distinguish themselves from other pharmacies. The more well-known the name, the more valuable this form of IP is - mention 'Boots', for example, and most will have an instant association with the largest pharmaceutical retailer in the UK.

The Challenges There cannot be anyone working in or with community pharmacy that either feels or sees the pain that emanates from the current operating climate. Pharmacy closures; increased workload and operating costs; increased patient and commissioner expectations; and, more fundamentally, an inadequate, undervalued and poorly structured remuneration and reimbursement contractual framework. As important as they are, we will not focus on these points here as they are not in the control of pharmacy owners and managers. They are the responsibility of those organisations that represent them at a national and local level who must deliver a better outcome as difficult as that may be. However, there are matters which are in the control of pharmacy owners and managers. These include their premises, their team, their systems and processes, their relationships with other healthcare providers and the broader community, their NHS and private service offer, and how they promote and deliver them to give the best patient experience. In order to create the head space to develop and implement a business plan, pharmacy owners and managers must make time to work on their business as well as in it. Then it requires the capacity and capability within their team to deliver the services and that excellent patient experience.

Pharmacy contractors continue to grapple with profit pressures despite many reporting significant sales revenue increases, according to Hutchings Consultants' England Pharmacy Market Update 2024. The report emphasises that gross profit margins are under considerable strain due to factors such as rising wholesale drug costs, the dispensing of certain drug lines at a loss, reduced drug tariff reimbursements, and ongoing medicine shortages. These challenges have led to a growing number of pharmacies reporting substantial declines in their profit margins this year. For instance, Cohens Chemists reported a £5.7 million loss in the last financial year, even as sales reached £253 million. Similarly, Day Lewis, the UK's second-largest independent pharmacy chain, experienced a 5.9% sales increase driven by growth in prescription dispensing, over-the-counter sales, and pharmacy services, yet faced a 32% drop in pre-tax profits due to heightened administration costs, which included inflation-driven increases in staff, energy, utilities, and rent. The average profit margin has declined to 33% in 2024, down from 34.4% the previous year.

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

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.