In 2015, the Department of Health and Social Care (DHSC) wrote to the PSNC (now Community Pharmacy England), announcing swingeing cuts to NHS pharmacy funding. Tucked away in the letter was a proposal that the law would be amended to allow pharmacies to use hub and spoke dispensing. The implication was that the effect of the cuts could be partly eased because pharmacies (spokes) would be able to reduce their labour costs by outsourcing dispensing to prescription factories (hubs).
Historically, a pharmacy could outsource dispensing to another pharmacy if both pharmacies had the same owner. Otherwise, this could not be done unless the hub which carried out the dispensing had a manufacturer’s licence.
Read more: Hub-and-spoke dispensing start date revealed
A decade after DHSC first proposed allowing all pharmacies to outsource (or sub-contract) dispensing, the changes in the law to allow dispensing to be outsourced will come into force on 1 October 2025 with amendments to the Medicines Act 1968 and the Human Medicines Act 2012.
The changes to the law are not straightforward and cover many aspects of dispensing.
Registered pharmacies
Both the spoke that has received the prescription and the hub which does the dispensing must be pharmacy premises that are registered with the General Pharmaceutical Council.
Written arrangements
There must be written arrangements between the hub and the spoke. These written arrangements must include a comprehensive statement of the respective responsibilities of the hub and the spoke. This is needed to ensure accountability.
The spoke
The spoke must display a conspicuous notice both on its premises and any website, giving a description of the hub and spoke arrangements and the name and address of the hub.
The hub
The hub does not need to hold the prescription when dispensing.
Supply from hub to spoke
Under medicines law, the supply of a medicine to someone who is not the patient or a patient’s representative is a wholesale transaction which requires a wholesale dealer’s licence. However, in a hub and spoke operation, when the hub sends the dispensed item back to the spoke, this is deemed to be a retail transaction and a licence is not required.
Data protection
The processing of personal data, especially sensitive personal data like health information, is protected by the Data Protection Act and UK GDPR. To enable a pharmacy owned by one company to send a patient’s sensitive personal data to a pharmacy owned by another company, the legal basis for processing will be that the processing is necessary for a task carried out in the public interest. Pharmacists and pharmacy technicians already have a professional duty of confidentiality. Anyone who processes sensitive personal data as part of a hub and spoke operation will now be subject to a legal duty of confidentiality.
Dispensing label
Even though the dispensing has been done at the hub, the dispensing label must show the name and address of the spoke. The date on the label must be the date on which the dispensed item is ready to supply to a patient, which may be the date on which the spoke receives it from the hub.
Supervision
The law on supervision is not changed by allowing pharmacies to operate a hub and spoke model. This means that the supply of the dispensed medication to a patient must be carried out by a pharmacist or under the supervision of a pharmacist at the spoke.
Supply to patients
Only the spoke may supply medicines to patients.
Serious shortage protocols (SSDs)
If an SSD is in place, any decision about what to supply to a patient will be down to the spoke, not the hub.
NHS terms of service
The NHS terms of service for England have been amended. From 1 October 2025, they will ban pharmacies from sub-contracting their core dispensing functions of the assembly or part-assembly of any prescription item (including bagging and the application of dispensing labels). However, this ban does not apply to:
- companies in the same group where both are subsidiaries of a parent company;
- valid hub and spoke arrangements;
- temporary arrangements under which a pharmacy buyer provides services in the name of the seller while a sale is going through.
A hub and spoke arrangement will only be valid if:
- the spoke has given notice in writing to NHS England of its intention to sub-contract core dispensing functions;
- the notice includes the information NHS England has required;
- the notice is given not less than 28 days before the date on which the proposed arrangements are intended to commence, or by a date agreed with NHS England;
- the spoke has taken reasonable steps, before entering into the arrangements, to satisfy itself of the hub’s fitness to carry out core dispensing functions on the spoke’s behalf;
- the arrangements involve supply direct to patients at or from the spoke and do not allow the hub to supply direct to patients;
- the hub cannot sub-contract any of its functions.
The business continuity plan that the spoke has as part of its existing NHS terms of service must deal with what will happen if there is a temporary or permanent disruption or discontinuation of the hub and spoke arrangements.
NHS England can serve a notice blocking hub and spoke arrangements if, for example, there has been a breach of the requirements or of the terms of service, if there is a patient safety issue, or if NHS England would be caused a material financial loss.
Two outstanding questions
I have two final questions. Firstly, will hub and spoke dispensing enable pharmacies to reduce their costs? Only time will tell. Secondly, can anyone tell me why, when the whole process starts and ends with the spoke, we refer to hub and spoke dispensing, and not spoke and hub dispensing?
David Reissner is Chair of the Pharmacy Law & Ethics Association