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A new report from Community Pharmacy England (CPE) has raised alarms about the severe financial challenges plaguing pharmacies across the sector, threatening their ability to provide even the core services for their patients. The findings are based on responses from over 6,100 pharmacy owners and 2,000 pharmacy staff who participated in the recent Pharmacy Pressures Survey 2024. The report reveals that spiralling costs and increased workloads, coupled with a 30 per cent funding cut in real terms since 2015, are putting countless pharmacies at risk of closure. "Nearly 1 in 6 may close within the next year," the report revealed. A vast majority (94 per cent) of pharmacy owners reported that they have seen significant increases in costs, with almost two-thirds (64 per cent) saying they are operating at a loss. Concerningly, these financial pressures are now affecting patient care, as 18 per cent of pharmacy staff reported severe impacts. The survey revealed that most pharmacies are experiencing longer prescription dispensing times (86 per cent), delays in responding to patient inquiries (80 per cent), and less time to spend with patients (79 per cent).

A harsh funding regime that hasn't adapted to changing macroeconomic realities means the viability of large parts of the pharmacy sector is at risk unless the model changes. Very simply, across the sector, revenue has remained largely fixed while costs have increased significantly, making it impossible for many pharmacies to sustain their business models. The sector has seen the closure of more than 1,500 community pharmacies since 2015, with 700 of these closures occurring since 2021. Larger pharmacy operators such as Lloyds, Boots, and Rowlands have seen the biggest decline in numbers, with smaller businesses operating between one and five pharmacies now accounting for almost 50% of the sector. Despite rising inflation and business costs, the NHS pharmacy funding model has remained fixed. Over the period of the current Community Pharmacy Contractual Framework (CPCF) - 2019-2024 - pharmacies have experienced a 30% real terms cut in core funding leading to an annual shortfall of over £750 million, equivalent to £67,000 per pharmacy in England. The current CPCF is due to end in 2024, and there is still no arrangement in place for future funding, leading to delayed and inefficient spending decisions and hampering the ability of the sector to plan and attract much-needed investment.

Pharmacy bodies have urged the Health Select Committee to hold the government to account on pharmacy funding and workforce challenges. In a show of unity, leaders from the sector came together to write a joint letter to the chair of the committee and former health secretary Jeremy Hunt and bring to his attention how financial pressures worsened by nearly a decade of a real-term decrease in funding have made the sector virtually untenable. The Pharmaceutical Services Negotiating Committee (PSNC)'s recently published 'Pharmacy Pressures Survey' confirms how this has had an impact on pharmacy contractors, their teams as well as patients. The survey found that 91 per cent of pharmacies are experiencing staff shortages. At the same time, demand for community pharmacists has risen - nine in ten pharmacy teams reported a significant increase in phone calls from patients about prescriptions, and 86 per cent reported a rise in requests for healthcare advice. The letter to Jeremy Hunt is signed on behalf of the four chief executives of the PSNC, the Association of Independent Multiple Pharmacies (AIMp), the Company Chemists' Association (CCA) and the National Pharmacy Association (NPA).

Community Pharmacy England (CPE) has cautioned that patients in the UK will continue to encounter difficulties in accessing medicines unless the government addresses supply problems and resolves the critical financial state of community pharmacies. CPE Chief Executive Janet Morrison and Mike Dent, Director of Pharmacy Funding, on Monday 19 February, gave evidence to the Health and Social Care Select Committee's Pharmacy Inquiry, highlighting the impact of ongoing medicines supply issues on pharmacies and patients. Morrison indicated that a combination of the ongoing "financial squeeze, operational pressures, and medicines supply and pricing issues" has left pharmacy businesses fighting for survival. "As the NHS continues to grapple with wider challenges, this is a battle that patients cannot afford for pharmacies to lose," she said. Morrison warned that if pharmacies continue to close, not only business owners and pharmacy teams will suffer, but patients and local communities will also face the consequences.

Munira Wilson, the Liberal Democrat MP for Twickenham, highlighted the impact of the community pharmacy closures in the Hampton area, and the severe financial challenges facing community pharmacies across England during an adjournment debate in the House of Commons on Friday. She also raised concerns about the impenetrable bureaucratic processes surrounding new pharmacy license applications and closures. Wilson highlighted the closure of two Boots pharmacies in Hampton last autumn, including one in the deprived ward of Hampton North. The Tangley Park pharmacy closure left the entire ward, which lacks adequate public transport, without a pharmacy, severely affecting elderly and vulnerable residents. "The nearest pharmacy is now a mile away on foot, a distance which is difficult to cover for the elderly and those with mobility issues, certainly more than a 20-minute walk, the measure that previous ministers like to use to highlight pharmacy accessibility," she said.

We have been specialising in community pharmacy sector for over 30 years and have helped many pharmacists acquire their first pharmacy. We have seen several of those first-time buyers transition into multiple pharmacy owners under our specialist guidance and support through the years. Acquiring the first pharmacy can be a challenge to most pharmacists especially when they do not have the necessary skill in reading the numbers presented in terms of the target pharmacy's performance and how to interpret these in order to arrive at a valuation for the purpose of submitting an offer. Without the guidance of a specialist accountant in community pharmacy, one of the major risks is that one could end up paying more than what the pharmacy is worth. Once the offer is accepted, there are other challenges to overcome to get the deal over the line. 1) Assessing the risk 2) Valuation of the business 3) The negotiation process 4) Asset or company purchase 5) Financial due diligence 6) Asset/share purchase agreement 7) Finance the purchase

The National Pharmacy Association (NPA) has called on the NHS and the Department of Health to immediately publish the government-commissioned analysis of pharmacy underfunding and reveal the true scale of the crisis. Commissioned by NHS England, the long-awaited independent review is expected to "lay bare the perilous financial state" of community pharmacies, which is a vital part of the nation's health infrastructure. However, the NPA is concerned that the government may delay its release until after current funding consultations are concluded. The NPA argued that the public needs to understand the fragile nature of the pharmacy network before any new deal can be agreed. It has also warned health officials not to hide "the true scale of funding needed to reverse a decade of swingeing cuts", which has forced record numbers of pharmacy closures. NPA chair Nick Kaye said: "It would be a scandal to keep that evidence buried secret and leave MPs, pharmacies and the public in the dark." He acknowledged that the new government has inherited a crisis in pharmacy funding and emphasised that it will need to take "strong action" to maintain access to medicines.

In a stirring address at the recent conference on Pharmacy at the Westminster Health Forum, Director of NHS Services at Community Pharmacy England (CPE), Alastair Buxton presented a stark assessment of the community pharmacy sector's challenges. Highlighting years of financial constraints imposed by the NHS and government, Buxton warned of a sector teetering on the edge of survival. "There have been no years of financial and operational squeezes applied by the NHS and government to the community pharmacy sector, so as a consequence, there are a lot of pharmacies that are on the on the brink of survival -battling for survival," he said. Buxton underscored the critical and indispensable role of community pharmacies in delivering essential NHS services, from dispensing medications to innovative initiatives like the Discharge Medicine Service and Contraception Service.

The Pharmaceutical Services Negotiating Committee (PSNC) has launched Pharmacy Pressures Survey 2023 to make case against the 'unprecedented financial and operational challenges' faced by the community pharmacies in England. The Committee has urged those working in or owns a community pharmacy to 'take part' in the survey. "The survey results will be critical to help us to show Government and the NHS how difficult things now are for pharmacies, and to persuade them to take action. We will be using the results in our negotiations, in our conversations with MPs, Ministers and in national media work as part of the joint #saveourpharmacies campaign," said PSNC. The Pharmacy Pressures Survey is once again comprised of two surveys to give insight into both financial and operational pressures. Together with the other national pharmacy organisations PSNC are working both to show policy makers the severity of the problems and to lobby for Government and NHS action to ease the pressures.

The Department of Health in Northern Ireland has advised pharmacies to continue providing rota services on Easter after learning that many pharmacies are unwilling to provide the services on Easter holidays. "It is extremely regrettable that community pharmacy representatives have advised that access to rota pharmacies in some parts of Northern Ireland will be reduced over the Easter holidays," department said. They have also stated that despite a commitment of recurrent investment, support for new patients assessed by Trusts as requiring blister packs may be restricted. These actions have the potential to impact on patients and other parts of the Health and Social Care system. The department has also called the CPNI's demand to increase the funding up to 50 per cent in the sector "unrealistic" in the current financial climate. It said: "Financial pressures across the entire NI public sector are severe with an extremely challenging health budget anticipated for 2023/24." "The Department is therefore facing a significant funding gap just to maintain existing services and the whole Health and Social Care system is an extremely unpredictable and fragile position. The core funding envelope available to community pharmacies in NI has increased by 16% over the past three years."

The nationwide implementation of the Pharmacy First service is viewed as a significant development that benefits pharmacies, primary care, and the broader National Health Service (NHS). Pharmacy teams are striving to ensure its success despite challenges within the industry landscape. However, not all pharmacists are able to reap the benefits from it. Recently, two members of Numark shared their experiences of how the scheme is impacting their pharmacies. Graham Phillips, who owns Letchworth Pharmacy in Hertfordshire, revealed that patients are responding favourably to the service. "It's all good, people are just delighted to have easier access to care," he said. In its first month, Letchworth Pharmacy provided around 100 consultations, and Phillips envisions that as the service matures, they will be able to conduct an average of 200 interventions per week. "That will make it financially viable for us and mean that we're acting at scale from an NHS perspective. That's 200 GP appointments we've freed up in a week - that's a huge capability and capacity bump for the NHS," he added. Graham credits part of his success with Pharmacy First to the strong relationship he has established with local GPs in his area.

Instability in the supply chain network is frequently undermining the profit margins in community pharmacies, former Pharmacy Minister and Chair of the Health and Social Care Committee Steve Brine has said. Brine emphasised that community pharmacies often lack information about the prices wholesalers charge for essential generic medications. "They lack visibility into scarcity, and the pricing of these products is often significantly higher compared to other European countries," the former minister remarked during a parliamentary debate focused on the future of community pharmacies on September 14. From financial pressures to workforce crisis and pharmacy closures, the debate delved into critical challenges faced by pharmacies, aiming to propose tangible solutions for a sustainable future in the sector. Chaired by Sir Mark Hendrik, the debate was initiated by Conservative MP Peter Aldous and featured contributions from a host of participants including Labour MPs Taiwo Owatemi and George Howarth among others.

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."

What skills does a pharmacist need these days? You'd think it would be sufficient to have a good understanding of pharmacy and the ability to offer a great patient service. Whilst this is true of course, the reality of the day to day role demands skills which most pharmacists have not been trained for as part of their formal qualification. At the very least, pharmacists find themselves responsible for running the pharmacy, managing people, managing processes and dealing with issues relating to customers, suppliers, surgeries, regulators and stakeholders. Even the most junior pharmacists quickly find themselves being accountable for the financial performance of their department and having to work within budgets or deliver on targets. Remarkably, despite the apparent lack of any formal training in these areas, pharmacists have been able to adapt and meet the challenges of whatever their job has thrown at them. Many pharmacists go even further, bringing out their inner entrepreneurial spirit to set up their own business. There are now over 6,000 pharmacy businesses owned by independent pharmacists, with this segment growing. Whilst pharmacists have historically adapted to their environments and picked up the necessary business skills, the rapidly changing landscape of pharmacy will require pharmacists to establish new skills to help ensure their businesses survive and thrive.

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.

What will it take to get help from the government before an individual or sector breaks? Pharmacists raised questions after the Pharmaceutical Services Negotiating Committee (PSNC)'s 2023 Pharmacy Pressures Survey confirmed the ongoing pressures and health issues faced by the pharmacies. Pharmacists are not all shocked by the PSNC's survey report as they feel the same as what has been reported related to their businesses and health. They hope the government listens and work with them to find resolutions. "We are bullied into a corner," said Salim Jetha Chairman, Avicenna. "Unlike other industries, we can't increase our prices. Most of the daily calls I get from Independents is about financial health of their business and any cost cutting would be detrimental to patient care. Urgent holistic review is required." Bristol pharmacist Ade Williams said: "The report is a dire indictment, and I would also warn, likely an underestimate of the extent and detrimental impact of the ongoings pressures and squeeze on Community pharmacies." "If the closest interface of the NHS to communities and patients is so distressed, what does that mean for those that need and depend on us? We are notoriously very stoic, so this is a warning light, which, taken with workforce pressures, market-exit activity, and other reports raising concern about wellbeing and stress, must beg the question; what will it take to get help before the sector and individuals break?" he questioned. The survey results don't surprise Kent-based community pharmacist Amish Patel. He said, "I have been feeling exactly what has been reported for far too long. I'm burnt out and would say beginning to suffer with my own health because of it. Now it's for PSNC to talk to government, and government to listen and work with us to find resolutions."

Professor Harry McQuillan has said community pharmacists in the UK must change their focus from an 'accuracy of supply' to a 'safety of supply' model when it comes to dealing with patients. "The main take away message from tonight's lecture is for pharmacy professionals to really challenge themselves about whether they are focused on accuracy of supply or safety of supply," he said at this year's UCL School of Pharmacy Lecture in London on Thursday, 15 June. "For our community pharmacists it must be about safety, including prescribing, and ensuring patients and citizens get the maximum benefit from prescribed medicines. "To deliver this, we need to invest in our teams - harness technology and always be willing to take the next step in a more clinical future." The Chief Executive Office of Community Pharmacy Scotland, however, noted that at a time when the UK was grappling with an unprecedented national debt crisis exacerbated by severe cost of living and spiraling inflation, community pharmacy will need to make a "compelling case" of where the priority should be in the sector. Expanding on the financial woes of the country, he compared the current national debt of the UK, which stood at a staggering 270 percent of GDP in September 2022, with the previous record-breaking national debt of 250 per cent at the end of WWII.

The Department of Health and Social Care (DHSC) in recent response to the questions asked by members of the House of Lords addressed the concerning trend of pharmacy closures in rural areas across the UK. Led by The Bishop of St Albans, inquiries focused on the number of community pharmacies that had ceased operations over the past five years and the ongoing financial challenges faced by those remaining in rural regions. Lord Markham, the Parliamentary Under-Secretary for Health and Social Care, provided insights into the stark reality confronting rural communities. Highlighting data as per Guide to applying the Rural Urban Classification to data (2019-2023) Markham illustrated the significant closure rates of rural pharmacies compared to the limited number of new openings between 2019 and 2023. The figures revealed a fluctuating trend over the past five years, indicating a dynamic landscape within rural pharmacy provision.

A recently published report on medicines optimisation highlights the urgent need for transformative changes across all pharmacies to unlock their full potential in delivering integrated care. The report by Public Policy Projects (PPP) is first of the four in the series that emphasises the significant benefits that medicines optimisation can bring to integrated care systems (ICSs). This includes reducing health inequalities and improving population health. Pointing to the "untapped opportunity" that medicines optimisation presents for ICSs facing financial challenges, the report underscores the vital role of pharmacies in enhancing patient outcomes. The launch of the Pharmacy First services has already demonstrated the essential contribution of pharmacies to the health and care system. With "medicines being the second highest cost to the NHS," the report recommends ways "to achieve better value for money while improving patient outcomes".

Community Pharmacy England (CPE) Chief Executive, Janet Morrison met with the new Pharmacy Minister, Dame Andrea Leadsom MP this week and discussed a range of critical topics, including funding and pressures. Janet informed the minister that community pharmacies continue to face immense financial pressures, and highlighted the need for an improved core contract. She told the minister that 35-50 per cent real term cuts and rising costs have led to closures, consolidations and cashflow. This has weakened the capacity for the network to respond to displaced patients, increased risk in terms of the safety of medicine supply, and led to loss of service for communities in the most deprived areas, she said.