While the multiple saw “increased sales year-on-year”, it was “adversely affected by external factors, chief among them being the impact of the NHS drug tariff”, McKesson UK CEO Toby Anderson told employees in a letter, seen by C+D.
“This directly affected our adjusted operating profit, which is the key measure of our annual bonus scheme,” Mr Anderson explained.
“We also missed some opportunities to be operationally excellent,” he added. “As a result of not achieving our target last year, the annual bonus plan for 2018-19 will not be paid out in July.”
Discretionary payments unaffected
However, discretionary payments – which are paid to individual store-based pharmacists, pharmacy managers and other members of the pharmacy team as a “gesture” of the company’s “appreciation” – will be unaffected, he said.
In the example seen by C+D, this was £250, which Mr Anderson described as a “thank you for your ongoing commitment to McKesson”.
One of Mr Anderson’s “key focuses” is to “embed a true performance culture” across McKesson UK, he said, adding that for the second half of the financial year it would be launching a “new bonus scheme that aims to better align reward to performance”.
“Much of the organisation” impacted
McKesson told C+D yesterday (July 25) that “much of the organisation, including pharmacists and pharmacy managers” will not receive their bonus as expected.
“It has been a challenging year for community pharmacy, but our colleagues are all focused on delivering innovation and efficiency to counter the external factors that affect us, and to maximise our profitability for the year ahead and beyond,” the company said.
In its latest financial report, McKesson UK revealed that adjusted operating profit for its European pharmaceutical solutions division – which includes Lloydspharmacy – was $219m (£168m) in 2018-19, a 36% drop compared with the previous year.