NHS England and the government must calculate the impact of the new pharmacy contract on the ‘financial sustainability’ of the sector to inform the 2026/27 deal, the National Pharmacy Association (NPA) has urged.

The recommendations from the NPA also called for the government to understand which clinical services can be ‘most efficiently’ delivered from community pharmacy rather than general practice or the wider NHS.

The calls to action come within a new NPA report responding to the NHS England-commissioned analysis of community pharmacy finances published in March and carried out by Frontier Economics and IQVIA. That analysis concluded that NHS funding was failing to meet full running costs for 98% of pharmacy contracts.

And it estimated that the cost of community pharmacies providing NHS pharmaceutical services in England equated to £5.063bn.

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Just days later, the delayed Community Pharmacist Contractual Framework (CPCF) was announced – with a £3bn funding envelope which is meant to see an ‘overall benefit’ to pharmacy contractors of £841m in 2025/26, when compared to 2023/24.

As part of its response, the NPA has said it wanted the modelling from the economic analysis to be re-run, following the latest financial settlement.

The body has asked NHS England and the Department of Health and Social Care (DHSC) to work with Community Pharmacy England to ‘model the effect’ of the 2024/25 and 2025/26 CPFC on the sector’s finances for the short- and long-term.

It stressed this analysis should be published and used ahead of the CPCF for the next financial year (2025/26).

NPA director of corporate affairs, Gareth Jones said: ‘The independent economic analysis proved that there was a very considerable gap between the funding provided by the NHS and the full economic cost of providing pharmacy services.

‘That remains the case even after the uplift contained in the new contract arrangements agreed last month.’

He added: ‘It is crucial that the government continues to focus on the need to make the community pharmacy network more sustainable. Having up to date numbers on the sustainability of the sector would assist them in this task.’

The report also requested that NHS England ‘urgently’ commissions further work to better understand which clinical services can be most efficiently delivered from community pharmacy as compared with general practice or the wider NHS.

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The NPA argued that this was ‘not fully answered’ by the economic analysis and that it wanted to see a ‘focus on the economics of future clinical services and the opportunities created by independent prescribers in community pharmacies in England’.

Other recommendations called on all pharmacy bodies to help ‘develop and propose ideas for reform of the CPCF alongside the work on substantive reform of the GP contract’.

It also asked that NHS England and the DHSC ‘fully engage all stakeholders in urgent reform of both the pharmacy and GP contracts, with a focus on sustainability, affordability and supporting the government’s strategic shifts and NHS 10-year plan’.

Mike Dent, director of pharmacy funding at CPE, said the economic review had ‘underlined the critical pressures that pharmacies are under, confirming the scale of a funding gap that we have been consistently warning policymakers of for many years’.

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He said the analysis also provided a ‘clear ambition to work towards’ and would be an ‘important factor’ in the DHSC’s upcoming spending review.

He added: ‘We very much see the new CPCF settlement as the first step on a journey towards longer-term stability and security for the sector and will be holding the government to account on its commitment to work with us towards a sustainable funding and operational model for community pharmacy.’

NHS England and the DHSC have been contacted for comment.