The door is open for the Pharmaceutical Services Negotiating Committee (PSNC) to persuade the government the 6% cuts are unachievable, it has been revealed.
The negotiating body has also received confidential information from the Department of Health (DH) that may "remedy the legal deficiencies in the government's case", David Reissner, the lawyer representing eight pharmacies in the legal challenge, said.
The information was disclosed by DH lawyers in response to a letter from Reissner, of Charles Russell Speechlys LLP, in which he detailed the grounds for claiming the cuts are unlawful.
Reissner has now issued his comment to the DH response, in which he noted lawyers insist the Secretary of State is "entitled" to proceed with the proposals.
Reissner said: "The letter sent on behalf of eight clients to the Health Minister explained that the NHS Act requires the Secretary of State to determine the remuneration for pharmaceutical services, but only after a consultation.
"Our objective was to not to say that remuneration could not be determined, but to point out that the requirements of the NHS Act appear to have been overlooked when the Minister wrote to the PSNC and others on 17 December last year.
"The letter to the Minister set out the legal requirements of a consultation. In short, these include:
(a) Provision of reasonable detail of what is actually proposed.
(b) Provision of adequate explanations and supporting information available to the decision-maker so to allow the consultee(s) a meaningful opportunity to engage with the reasoning process of the decision-maker.
(c) Genuine consideration of the issues with an open mind.
"In response, the Government’s insist that the Secretary of State is entitled to go ahead with his proposals, and deny that anything unlawful has taken place.
"However, the response from the Government’s lawyers does not challenge our criticisms of the current process, and the Government lawyers do not address in their response the question of the Secretary of State’s future entitlement to determine remuneration.
"If the Secretary of State were to determine remuneration at a future date, this would be unlawful unless a proper consultation has been carried out.
"Since writing to the Minister, the Department has announced that the consultation period has been extended by two months.
"In the response to our letter, we have been told that the Government has provided confidential material to the PSNC.
"It may be that the provision of such information goes some way to remedy the legal deficiencies in the Government’s case. We cannot know because we do not know what material has been provided.
"There is an encouraging note in the response from the Government lawyers, because they say that it is open to the PSNC to persuade the Government that the proposed cuts cannot be achieved consistently with the Secretary of State’s statutory duties, and that this could result in the level of funding being revisited.
"Further legal action is not something that could be considered before the Secretary of State makes a formal determination of remuneration."
Named pharmacies partaking in the legal challenge include 56- branch Kamsons Pharmacy, Murray’s Pharmacy that owns 25 premises and Medipharmacy Group that has 23 sites.
They are joined by 10-strong Hobbs Pharmacy and Hopkins Pharmacy in Uxbridge.
PSNC has been contacted for a comment.