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Avicenna CEO: Generics price 'hunting' will lead to further clawbacks

Salim Jetha: The 17p-per-item price drop for July is a step too far
Salim Jetha: The 17p-per-item price drop for July is a step too far

Contractors will be hit by further funding clawbacks after “hunting” for affordable generics, the CEO of independent pharmacy group Avicenna has warned.

Salim Jetha made the comments as contractors face an additional 17p-per-item price drop across all category M items for July.

Contractors have “learned to be lean” to cope with the funding cuts in England and increase in prescriptions over recent years, he said, but the latest “steep cut” is a “step too far”.

The situation is likely to get worse as contractors’ “short-term generics price hunting will be met by further category M clawbacks”, he told C+D last week (July 13).

The Pharmaceutical Services Negotiating Committee (PSNC) said the 17p-per-item drop for July “is driven by an overall reduction in manufacturers’ selling out prices” during the first three months of this year.

It is “mostly associated with price concession lines, and not due to planned management of retained margin”, it added at the time of the announcement.

PSNC is continuing to work with the Department of Health and Social Care on the upcoming margins survey for 2017-18, which will determine whether there will be a further category M clawback, it added.

Funding “gap too wide”

Mr Jetha said while “there are opportunities in providing new services such as travel [clinics]”, the funding “gap is too wide” to close by providing these services alone.

Contractors have responded to the funding pressures by increasing overdraft facilities, cutting staff and closing their pharmacies, he added.

PSNC told C+D this morning (July 18) that its committee members “are united in exploring solutions to ease the current pressure on contractors”.

“We are very worried about the financial state that many community pharmacies now find themselves in and will continue to make this point to government and the NHS,” it stressed.

2 Comments
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How is your pharmacy coping with the funding pressures?

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Ben Merriman, Community pharmacist

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