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‘I sold six pharmacies to pay off £1m of debt after the funding cuts'

“Pharmacy funding is draining contractors of resources and energy”

An anonymous contractor explains how his pharmacy group went £1 million into its overdraft following the funding cuts, leaving him on the verge of bankruptcy and a mental breakdown

The 10 pharmacies I owned were mostly in affluent villages in south-east England, but we also served a few council estates. These house a disproportionately high population of elderly people, who are often isolated.

I have practised pharmacy for 35 years. My pharmacy group has won pretty much every sector award. I’ve hosted numerous government ministers, MPs and senior NHS officials at my branches.

After the 2015 funding cuts, my pharmacies maximised other sources of NHS income – taking in £30,000 for flu vaccinations across the group, conducting 400 medicines use reviews per branch and scoring 100% on quality payments.

However, all of this combined was not enough to cover the loss of income from core funding cuts. From 2016-18 medicines costs went up by 3%, while operating costs such as water and rent increased by 17%.

Last year, my pharmacy group had a £10 million turnover, but a net loss of £300,000. At one point we were £1 million overdrawn. I was on the verge of bankruptcy, and only just avoided a mental breakdown.

This was totally unsustainable. I was fortunate to find a buyer for six of our 10 branches. This has, for now, reduced my debt. However, the remaining branches are all losing money. Our group’s net profit dropped from 3% in 2016 to -5% in 2018.

No one is owed a living or entitled to a subsidy. But there is potential for community pharmacists to take so much pressure off other parts of the NHS and do so at a fraction of the cost of a GP or A&E department.

Pharmacies are a local lifeline. I vividly recall the day my own pharmacy team helped save a baby’s life, after the mother brought the child in with what turned out to be sepsis.

On the other hand, if the NHS and the government back pharmacies like mine across the country, with sufficient funding, I’m sure we could transform healthcare for the better.

By emphasising clinical services, the five-year contractual framework sets out a good destination – but we need fuel for the journey or we’ll never get there.

You’d be hard pressed to find a pharmacist more willing than me to embrace innovation and new public health services. However, the pharmacy funding situation is draining contractors of resources and energy and making me doubt that there’s a future for me at all in community pharmacy.

The contractor owns four pharmacies in south-east England

This article is part of a collaboration between C+D and the National Pharmacy Association to draw attention to the financial conditions independent contractors are facing.

Do you have a story you’d like to share? Email C+D features editor Thomas Cox at [email protected] or tweet @ChemistDruggist.

6 Comments

David Kent, Community pharmacist

For a group of 10 pharmacies to acrue losses of over £1m then they mus have been extremely poorly run.

Hanbal Chaudry, Community pharmacist

Next 5 years are going to be hard. New services, innovation, efficiency or not bricks and mortar Pharmacies need minimum of 8000-9000 items pm to prosper. Internet pharmacies and even behemoth like Pharmacy2u can’t replace us. Who is going to talk to little old biddies who forgot to order their tablets or have queries. An impersonal call centre where staff don’t know you?

Chris Locum, Locum pharmacist

You are on a financial escalator, heading downwards. Quitting, while ahead does not make you a quitter. The future will be ruled by a few big groups over the next few years. The visitors can speak fine words, but it won't save independents. They are deliberately being taken off the health-care arena.

Brian Perry, Locum pharmacist

A significant question arising from this is "Who, ultimately is going to do the Nation's dispensing ?" If a profit cannot be made and the pharmacy closes (and how many pharmacies would there be in "an affluent rural village" or on a council estate this will leave the door wide open for the medical profession to introduce Dr dispensing.

 

Alexander The Great, Community pharmacist

Ultimately. they only want the strongest to survive, if there are 3 pharmacies, maybe 1/2 will close. Until they cull enough, they wont increase funding.

Alexander The Great, Community pharmacist

Wow, I am very pleased you found a buyer, that in itself is no mean feat. If all your other branches are loss making, I'd suggest you close them down and turn the shop into a different business. A coffee shop in a good location could make £1000 per day gross.

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