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Government ‘getting nervous’ about pharmacy sell-offs, says PSNC


Government ‘getting nervous’ about pharmacy sell-offs, says PSNC

Government officials are “getting nervous” about reports that large pharmacy multiples are shedding branches, PSNC chief Janet Morrison has told this year’s Sigma conference.

When asked by Pharmacy Network News what impact recent reports of widespread branch sales by multiples could have on PSNC’s negotiations and on the wider sector, Ms Morrison replied via videolink in a session chaired by CIG policy and public affairs director Rob Darracott: “There is a lot of speculation about what the impact could be, we’ve got to see how the dust settles.

“News like this does have an impact. They are getting nervous in Government about this, that actually we haven’t been crying wolf about [the sector’s situation].

“We keep a regular eye on this, and the Department are fully aware also. I can’t say that with any glee, patients who are affected, and of course the staff and owners of pharmacies who are really struggling to stay afloat.”

“Independents are hanging on in there and just working harder and harder to try and make ends meet”

Ms Morrison said there’s been “a lot of consolidation or sales going on” in the sector as a whole but that the future is unclear for independents: “From my experience, independents are hanging on in there and just working harder and harder to try and make ends meet and handle cash flow, but I don’t know how much longer people can go on.

Janet Morisson, CEO PSNC - 'With us or against us'

“The risk is not just the actual closures [but also that] the remaining pharmacies in the locality are so fragile they may not be able to pick up the slack of many thousands of patients – the disruption is awful. We’ve got 53 per cent of the population on repeat prescriptions, so that matters.”

Noting that there had been “about 900 permanent closures in the last five to seven years,” Ms Morrison speculated that “we could be seeing that order or more” in the next few years.

Contractor Ian Strachan asked Ms Morrison whether it had been “wise” from a negotiations standpoint to make public announcements early in her tenure to the effect that pharmacies are unlikely to undertake industrial action over their funding constraints. She replied that in her experience ministers have a ‘with us or against us’ mentality and if they view someone as an opponent “they don’t feel they have to talk to them”.

“Quiet diplomacy” is more effective than an adversarial approach, she said.

Pharmacy First Service

On the issue of a funded Pharmacy First service, Ms Morrison said numerous Government officials, including an advisor to prime minister Rishi Sunak, have left her with the impression that “pharmacy and Pharmacy First are flavour of the month” with Government due to the potential for relieving pressure in primary care. However, she noted that when the PSNC previously presented a fully costed pitch for a funded service to NHS England and the DHSC, it had been rejected. She said that while Government officials are often sympathetic, “their eye is absolutely on that five-year envelope” due to their instructions from higher up on balancing the books. She added the NHS England has a “marvellous ability” to demonstrate understanding for the sector’s difficulties and then “carry on with business as usual”.

The session also heard from PSNC funding director Mike Dent, who said the gloomy economic picture is unlikely to lift in the near future, and that predictions that high inflation and borrowing cost will continue for some time will have an impact on Government spending.

“Contractors need to be politically aware,” Mr Dent said, adding that “we can’t deny” the new economic reality. Higher energy costs are also likely to continue he said, partly due to “the green agenda” and partly because energy firms are now “used to charging you those rates”. Commenting that “it’s going to be a very unforgiving place for all of us in the next few years,” Mr Dent urged struggling contractors to “get help” in the shape of a thorough cash flow assessment.

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