“There is a conflict of interest between the people who are actively pushing hub-and-spoke and the commercial interests of large wholesalers,” Mike Hewitson told C+D yesterday (March 8).
“People, for example, who work in the large vertically integrated companies think this is the future,” he said.
However, hub-and-spoke puts larger organisations with a delivery infrastructure network in the “dominant market position”, which reduces competition and allows them to “dictate terms to independent [wholesalers]”, Mr Hewitson said.
“There are of course people who are very passionate and they think this is the right way forward, but it could be a really dangerous Pandora’s box for us to open, particularly in independent pharmacy, unless people understand what they are getting into,” he stressed.
Mr Hewitson chaired the NPA’s hub-and-spoke task group last year, which the organisation claims helped to delay the government’s plans to change legislation aimed at expanding the use of hub-and-spoke dispensing.
While the NPA “recognises the need for dialogue” on this dispensing model, “there is no evidence to support the assumption that it will save money”, Mr Hewitson said. Instead, there could be hidden costs to rolling out the system, he warned.
“Hub providers are going to want to recoup their costs, which could mean charging a service fee or retaining more of the profit margin,” he said.
“You could potentially create headroom to deliver services if you keep staffing levels in place. But the government wants [the sector] to drive down costs, which means getting rid of staff who are currently doing the work.
“The government definitely doesn’t understand the economics of hub-and-spoke."
The NPA is not condemning the model completely, Mr Hewitson said, but the evidence and technology to support the dispensing model “isn’t there at the moment”.
“We are not against change. What we are saying is this particular change has been badly thought through and perhaps some people have swallowed the marketing brochure without really understanding how pharmacies – and the people in them – work,” he said.
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