Are we heading towards fairer price concessions?


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The Pharmaceutical Services Negotiating Committee (PSNC) has been holding discussions with the Department of Health and Social Care (DHSC) on a ‘fairer price concession system’.

Community pharmacy has seen an increase in the number of concessionary prices since June 2017 due to a rise in generic medicine selling prices.

Parliamentary under-secretary for health and social care Steve Brine said that the reasons for the rise ‘include reduced stock due to regulatory action against several large manufacturers and a decrease in the value of sterling’.

He continued: ‘Reimbursement prices of the most commonly prescribed generic medicines were also reduced from August 2017 to recoup medicine margin over delivery and adjust community pharmacy funding to the set level.

‘This downward adjustment to generic medicine reimbursement prices happened at a similar time to when generic medicine selling prices started to increase.’

The Pharmacist has contacted the DHSC for comment.

Fluctuating prices

The generics market is a competitive one where prices fluctuate.

At the moment, many community pharmacies have to shop around, as they can’t get hold of some medicines.

As a result, pharmacists are having cashflow issues due to Drug Tariff reimbursement prices that don’t cover the price of the medicines they purchase.

‘Financial risk’

Director of pharmacy funding at PSNC Mike Dent said that ‘higher prices on these lines mean that Clinical Commissioning Groups (CCGs) are facing a significant financial risk’.

He continued: ‘Generics prices in England are incredibly low compared to most parts of the world.

‘The policy to incentivise community pharmacies to reduce medicines prices for the NHS has worked incredibly well.

‘Generics is a global market, so international manufacturers can choose to sell where they will make the best financial return.’

Pharmacists are already under a lot of pressure following the Government’s funding cuts to pharmacy and recovery of excess margin earned in previous years.

PSNC said that it wants to ensure that the DHSC ‘is aware of the hardship the price rises are imposing on contractors’.

It added: ‘We will continue to press for immediate improvements to the price concessions system, but believes that forthcoming regulation on the disclosure of information on healthcare products, will have an impact on managing price concessions, when a refined system can be established which makes use of the increased data capture.’

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