Data analysts: 315 pharmacies at ‘high risk’ of closure

Many of the pharmacies most at risk are located in London

The latest impact assessment from data analysts IMS Health has revealed that 315 pharmacies in England are at “high risk” of closure.

IMS Health used data from the NHS, the Pharmaceutical Services Negotiating Committee and its own records to identify the pharmacies which would be most impacted by the funding cuts (see image below).

Most of these are located in London, IMS Health director of supplier relations Carol Alexandre pointed out.

It identified these businesses by combining the 10% least profit-generating pharmacies, with those which rely on the dwindling establishment payment for 20% of their gross profit, Ms Alexandre told the Sigma conference in Rio de Janeiro yesterday (February 15).

While this information doesn’t take account of labour costs, rent and rates, IMS believes it is still a “robust analysis”, she said.

Of these 315 “high risk” pharmacies, 200 are within a 10-minute walk of another pharmacy, Ms Alexandre stressed.

IMS Health's analysis also revealed 2,400 pharmacies in England are at “medium risk” of closure – as they rely on the establishment payment for 15% of their gross profit, she added.

Catch up with all the latest coverage from the Sigma conference in Rio with C+D's Storify here

11 Comments
Question: 
Is your pharmacy facing closure over the cuts?

Benjamin Leon D'Montigny, Non Pharmacist Branch Manager

I've worked in that South area, and there are definitely no shortage of pharmacies. However most of them in my experience are also pulling the numbers to be viable.

P M, Community pharmacist

yeah c&d please run an article on pharmacist salaries and how they stand to lose out if these closures happen - how many pharmacists and staff will lose their jobs ?

also could you do an article on how many locums would prefer to work for less and keep their jobs?

while your at it explain to us why house prices have rocketed in the last ten years,

one bedroom flats in my area are now going for £300000 and only ten years ago they were half that..

 

Shaun Steren, Pharmaceutical Adviser

Employee/locum wages have been falling for ten years, the suggestion that the recent 'cuts' are about to start the damage is laughable. The near doubling of pharmacy schools is more than sufficient to decimate the employment prospects of employee/locum pharmacists.  

As to the dynamic between employee/locum pharmacists and contractor pharmacists in the post-cuts environment, it is quite simple: the former has already felt and accepted the pain, the latter are about to feel it for themselves. When employee/locum pharmacists wages began to fall ten years ago, many a contractor crowed about the need to 'skill up', 'demonstrate added value', 'diversify' and of course 'not being owed a living'. Well how about taking some of your own advice. 

Is there anything more pathetic to see a now weaponless contractor class try and intimidate a now battle hardened employee class? If it was not for the spitefulness of such behaviour, you would pity them. Yes, employee/locum wages will continue to fall. Yes, competition for employee/locum positions will continue to increase. Yes, working conditions for employee/locum pharmacists will continue to get worse. Yes we know! We have accepted the reality! You cannot threaten us with the inevitable! Try facing up to your own problems, we have. 

P M, Community pharmacist

contractor class - nice one 

Shaun Steren, Pharmaceutical Adviser

'nice one' ? Go on, make my day, use 'innit' within a sentence. 

Dave Downham, Manager

Dodgy data  and far too simplistic - what is the definition of 10% least-profit generating pharmacies? Is this the same ropey source as the Impact Assessment using Companies House data? If so, most small bunsiness will only show balance sheet, i.e. no idea of "profit". Similarly, if establishment payment of £25k is 20% of gross profit, then total gross profit from dispensing is £100k. At £2-£2.50 per item, that is 40-50,000 items a year or 6-7,000 per month. So, if you're open 100 hours, doing 8,000 items and don't have a good accountant, you'll be fine.

Charles Whitfield Bott, Pharmacist Director

They are all related, less income = pay staff less, pay locums less, rubbish pharmacies close, good ones remain and become more finanicaly secure (if less profitable). Number for sale reduces, demand outstrips supply, prices increase. Large companies are prepared to buy shops and not make any proffit for 10 years so they can increase the size of their estate, the result of which is that there are very few new entrants, consolidation by large companies and a lack of inovation.

Michael Franks, Community pharmacist

With the government announcing they want thousands to close is it a surprise that someone has found 300 at high risk? If a pharmacy has low OTC turnover they will be at risk if their NHS income is cut. Add in rate, rent and wage inflation and you do not have to be brain of Britain to forecast closures. The closures will not be immediate but will be precipitated by a rent increase being the last straw.   The effect on the population will be a less personal service and probably increased errors by more stress being placed on fewer pharmacies.

Do not train as a pharmacist join tfl as a tube driver!

Valentine Trodd, Community pharmacist

Somehow, I don't think wage inflation will be a problem.

Valentine Trodd, Community pharmacist

Oh please! More whinging from sunny Rio. Can someone pick up the story about plummeting pharmacist salaries, diving locum rates and the skyrocketing price of pharmacies?

S Morein, Pharmacy Area manager/ Operations Manager

Spot on Valentine. The usual suspects are making the same fictional proclamations of mass closures that they have since the onset of the contractual framework in 2005. Yet pharmacy numbers continue to grow. As does contractors profits and goodwill values. These constant articles about imagined closurers are embarassing.

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