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NPA urges competition watchdog to address hub-and-spoke concerns

The National Pharmacy Association (NPA) has called on the UK’s competition watchdog to address concerns over the wider implementation of a pharmacy hub-and-spoke dispensing model.

C+D understands that the Competition and Markets Authority (CMA) is unable to confirm whether or not it will be investigating the issue further.

Calls for the CMA’s intervention follow a meeting between the watchdog and the NPA last week, during which the “potential competition impacts” of introducing the dispensing model more widely was discussed.

 

Read more: Jhoots Pharmacy secures over £8m to implement hub-and-spoke model

 

At present, only pharmacies operating under the same company are able to share dispensing hubs, although the government is currently consulting on whether the law should be changed to allow all community pharmacies to operate under the system.

The CMA should “commit” to working on a market review should this policy go ahead, the NPA suggested.

 

“Dynamic and competitive market” needed

 

Dispensing hubs should operate within a competitive market to “avoid unintended consequences such as price rises and poor service”, the NPA told CMA senior officials.

NPA vice chair Nick Kaye argued that pharmacies will only truly benefit from a hub-and-spoke system if a “dynamic and competitive market” among hubs is maintained.

“It is highly likely only a few companies in the market will be able to provide fully comprehensive external hub dispensing services to pharmacies, at least initially.

“This would put pharmacies in a weak position as customers and might also lead to a rise in medicines prices for the NHS, the taxpayer and the public,” Mr Kaye, who attended the meeting, added.

 

Read more: Hub-and-spoke company registers ‘significant interest’ after DH consultation

 

The DH estimated that it will cost an average of £4,000 per pharmacy to complete the preparatory work necessary to operate within a hub-and-spoke dispensing model, which the NPA told C+D at the time it believes to be a “very low” estimate at “first glance”.

The consultation will run until June 8.

The DH is consulting on implementing two different hub-and-spoke models.

The two proposed hub-and-spoke dispensing models

First model: Patient presents prescription to the spoke pharmacy. The pharmacy sends it to the hub, which prepares and assembles the medicines. These are sent back to the spoke, which supplies them to the patient.

Second model: Same as above but the hub sends the medicines directly to the patient’s home rather than to the retail pharmacy.”

 

Catch up on C+D’s Big Debate which asked: Could a hub-and-spoke model ever truly work for independent pharmacies?

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