New minister brings new ideas
New health minister Dr David Clark says the previous government agreed to allow unqualified ownership of pharmacies, but he is more reserved about opening the gates. “Since coming into office, I have heard a number of concerns from the sector about this approach and share some of these concerns, particularly around the potential for increased corporatisation within the sector.”
However, Clark concedes there are challenges with the existing rules and how they work in practice. “Key terms such as ‘effective control’ are not defined in the Medicines Act and there is a lack of clarity about the concept of majority ownership and the five-pharmacy limit when there is joint ownership,” he says.
“Complex ownership structures have raised questions on whether the current provisions have achieved the expectation that the pharmacist owner has effective control of the pharmacy.”
Two ownership options to be consulted on
Clark says the Ministry of Health will soon consult on a draft of the Therapeutic Products Bill, including two options for pharmacy ownership. Key stakeholders will be asked for feedback on the previous Government’s proposal to allow open ownership and an alternative option of which retains the majority pharmacist ownership rule while “addressing weaknesses in the current arrangements”.
This opportunity for feedback will be additional to the usual consultation when a bill is going through Parliament, Clark says. “Given [the] breadth and complexity of this bill, I think it is important that stakeholders have an opportunity to work though the complex and detailed provisions in the bill. This will allow the bill to be refined before it is introduced into Parliament.”
The draft release was imminent at the time of this article’s publication. By deadline, Clark said he hoped to make an announcement before Christmas. Following consultation, he will consider whether any policy changes are needed in the bill, including whether a change to pharmacy ownership is required.
Society backs an end to ‘quasi-corporate ownership’
Pharmaceutical Society president Graeme Smith, who owns a pharmacy in Rangiora, says the society wants the rules strengthened. “We would be in favour of the status quo but with some of the rules being tightened so it’s not quasi-corporate ownership,” he says.
The society has produced a damning paper on pharmacy deregulation, based on overseas examples where ownership rules have been relaxed. One of the greatest concerns is the conflict between commercial imperative and a pharmacist’s ethics, Smith says.
“The man concerns that the society has are around ethical issues and the fact that overseas we’ve got strong anecdotal evidence, and a couple of direct examples, where corporate directors have influenced behaviour.” He gives an example of managers at the UK’s largest pharmacy chain, Boots, putting pressure on pharmacists to carry out reviews on patients who did not need them, because the reviews received state funding. In the US, pharmacists were gagged from telling patients about cheaper options (see sidebar Corporatisation impacts patients overseas).
“Not all corporates do this but some have got a track record of putting profit before professionalism,” Smith says.
Rules should be for pharmacists, not owners
Greg Harford, Retail NZ’s general manager of public affairs, doesn’t disagree that there needs to be clear rules about correct dispensing and care of patient safety. He just doesn’t agree the current pharmacy ownership rules are the best way to ensure that.
“The rules around pharmacy ownership are quite complex and quite dated,” Harford says. “They are focused on trying to regulate the activities of a pharmacist, rather than necessarily ensuring safety.”
Even with pharmacist ownership, a duty pharmacist needs to be rostered on at all times the pharmacy is open. Harford says a pharmacist would have difficulty directly supervising all of the pharmacists in five pharmacies – some of which are quite sizeable in their own right. “The focus should be on licencing people who are working in the pharmacy and making sure what they’re doing is the best for the consumers,” he says.
“I think the key point is that patient safety is not dependent on who owns a business. It’s the most important thing in the dispensing of medicines, absolutely, but we should not be using ownership of pharmacies as some kind of proxy.”
Harford would like to see the rules relaxed so anyone can own a pharmacy, allowing greater efficiencies through economies of scale. While the current rules have allowed corporates like Countdown and Chemist Warehouse to enter the market, there are still other ownership models to be explored for pharmacies, he says. “We’ve seen pharmacists trying to work within the rules now, with buying groups and so forth, but that’s not necessarily the only way that it could work.”
Like other retailers, many pharmacies are expanding their offerings to stay in business, Harford says, with some offering giftware, homeware, magazines and Lotto. “That’s just around converting the pharmacy into a hub for the community and making sure there’s enough business coming through the doors to remain