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NPA members report threefold increase in health centre pharmacies’ rents

Some pharmacy contractors renting their premises from health centre landlords have reported being asked for a threefold hike in rent, the National Pharmacy Association (NPA) has claimed.

For this reason, the NPA has invited NHS Property Services (NHSPS) to consider how “pharmacy spending power is shrinking” when suggesting rents for pharmacies based at health centres, it said yesterday (June 14).

The NPA could not disclose more information about the contractors claiming their rent could go up, due to confidentiality reasons.

 

Read more: AIMp urges pharmacy contractors hit by high rentals to put pressure on NHS landlords

 

But it has flagged the issue of “unaffordable health centre rents” to NHSPS – which is the landlord for most pharmacy premises located at health centres.

In a letter to NHSPS chief executive Martin Steele last month, NPA chief executive Mark Lyonette encouraged the NHS landlord to “take supportive action” in response to the challenges faced by the sector.

In response, Mr Steele confirmed NHSPS is willing to work with pharmacy customers to “ensure communities are able to access pharmacy services and that value for the NHS continues to be obtained and protected”.

Mr Steele added: “We will engage with individual pharmacy operators to explore options and assist with lease terms where there are potential financial difficulties.” 

 

Challenges faced by co-located branches

 

Mr Lyonette pointed to changes in the way GP practices “engage with patients”, which he said have resulted in “reduced footfall” to co-located pharmacies.

“The past years have seen far fewer patients in health centres and therefore using the on-site pharmacy.

“While the situation will change somewhat as we move out of the pandemic, we expect a permanent impact on workload as practices handle more of their interactions virtually,” he wrote in his letter to NHSPS.

 

Read more: Health centre pharmacy faces potential 220% rent hike, contractor claims

 

This, coupled with the increase in use of the electronic prescription service and reduced funding for pharmaceutical services, mean “many of our members are facing significant financial pressures”, Mr Lyonette stressed.

“We also believe that, should they be forced to close, the likelihood of [NHSPS] securing alternative tenants – certainly ones that can deliver a rent at the level paid by community pharmacies – is relatively low,” he continued.

Mr Lyonette invited NHSPS to review pharmacy lease agreements to “consider favourable changes” in light of the current pressures and suggested a meeting with affected contractors to further explore this problem “in more detail”.

 

Read more: NHS landlords slap down multiples' health centre rent reduction pleas

 

It adds to calls from the Association of Independent Multiple pharmacies (AIMp) for NHSPS to reconsider high rents for co-located pharmacies.

AIMp is currently inviting all affected contractors to sign a letter urging NHS and private landlords to adopt a “more realistic approach for calculating rents”.

Earlier this year, NHSPS slapped down Lloydspharmacy and Rowlands’ requests for co-located rent reductions, while last month a pharmacy contractor with branches across east London claimed to C+D that NHSPS had suggested the rent for his co-located pharmacy could increase by as much as 220%.

 

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