Medicine supply: Contractor Update from PSNC  

PSNC is becoming increasingly concerned about the sustained pressures on medicines supply and the very serious impact that this is having on community pharmacy teams and their patients.

As we move into the second half of the year, we are asking contractors and their teams to continue using our regular reporting tools to help us to demonstrate the scale of the problems to the Department of Health and Social Care (DHSC) and to support escalations as needed.

The sustained increases in price concessions that we have seen so far in 2022 – with more than 100 concessions being granted in some months – show no signs of abating, and we know that many pharmacies now find themselves in a critical situation trying to source medicines in timely manner and facing significant financial risk due to greater uncertainty around expected reimbursement prices for a large number of medicines.

We know that some concessions being imposed by the Department do not match contractors’ experience on the ground, and we would ask all contractors to continue reporting pricing issues to us on a regular basis to support our representations: Report product over Drug Tariff price.

We have escalated the situation and our concerns with the Department and are seeking both an improved price concession process to streamline processes and give contractors better information, as well as recognition of the impact this is now having on pharmacy teams.

Our Pharmacy Pressures Survey has confirmed the consequences of the issues pharmacy teams are now facing, finding that 83% of pharmacies had seen a significant increase in medicine supply issues in the past year, leading to extra work and additional stress for staff. Two-thirds of respondents said that medicines supply chain issues are now a daily occurrence, with 97% reporting that this led to frustration from patients.

The situation is distressing, adding both operational and financial pressures on pharmacy teams. We have updated our guidance for contractors, including revising our medicines supply factsheet. This, as well as further practical steps can be viewed at the bottom of this article.

Our work to raise this in the wider policy environment also continues following previous national media work (e.g. The Guardian and The Telegraph), and work to brief MPs. We are also working with the other pharmacy organisations to continue to raise the pressures on the sector, including via a petition calling for action to stop violence and abuse in pharmacies: Petition · Stop violence against local pharmacies and help us do more for patients ·

Gordon Hockey, PSNC Director Legal, said: 

“The current volatility and pricing issues in the medicines supply chain are extremely concerning to PSNC: we know that they are having a very negative impact across the sector, often on a daily basis. It is also particularly concerning to hear from pharmacy teams who report that some patients are showing aggression to pharmacy teams as a consequence of these sustained issues.

Pharmacies are doing everything that they can to manage supplies and patient expectations, but it is not acceptable that they are being put in this situation, on top of all the other critical issues and pressures that they are facing at the moment. We are continuing to seek Price Concessions from DHSC on a monthly basis, alongside escalating this within the Department.”

Further information

What pharmacy teams can do

Whilst PSNC will continue to work to mitigate the overarching issues, there are some practical steps that contractors and their teams can take to help manage the situation and support our work.

  1. Try contacting a range of different wholesalers and suppliers to locate stock at or lower than Drug Tariff price;
  2. Report issues where the product can only be obtained at a price higher than the Drug Tariff listed price using PSNC’s online form;
  3. Check for any known supply issues in the Medicines Supply Tool hosted on the Specialist Pharmacy Service (SPS) website (any new shortages can be reported to PSNC here). Access to the Medicines Supply Tool requires registration with an NHS email address.
  4. Report any new medicine shortages not listed on the SPS website using PSNC’s online reporting form.
  5. Check for any current Serious Shortage Protocols (SSPs) that may allow alternatives to be given without needing to go back to the prescriber;
  6. Provide affected patients with a copy of this medicines supply factsheet; and
  7. Liaise with the GP to see if an alternative treatment can be provided.

If you face verbal abuse from patients due to medicine supply issues, please don’t feel like you have to tolerate it. The pharmacy regulations say that if a contractor or their staff (or other people at the premises) are threatened with violence, a contractor may refuse to dispense a prescription. This also applies if the person threatens to commit a criminal offence. Obviously, refusal is also an option if any of those threats are carried out.

We are aware of the following resources which may be helpful, and others may be available from other pharmacy support organisations.

PSNC will keep pushing for other measures to help pharmacy contractors and their teams.

More information on the price concession system

One of the measures we have to mitigate the impact of medicine supply issues, is price concessions.

PSNC relies on reports of products that are only available at above Drug Tariff prices being made to us by contractors – each month, we look at all those submitted to make applications for price concessions to DHSC. Concession negotiations with DHSC often continue back-and-forth throughout the month and, if we are unable to come to an agreement, DHSC may impose a price that they feel is reflective of the market data they have access to. Read more about how the system works in our briefing: PSNC Briefing 023/22: How the price concession system operates

PSNC works to negotiate price concessions that are as close to market prices as possible. We are also aware of the need to finalise price concessions as early as possible in the month so that contractors have certainty over what they will be reimbursed, which means we also need to finalise prices as quickly as possible. This can sometimes be a delicate balancing act. But we understand the difficult challenges faced by contractors when the final price granted or imposed by DHSC falls below the purchase price they have paid and we will continue to press them on this matter.

It should be noted that as part of the margins survey each year, an exercise is conducted to calculate the financial impact of concession lines on contractors. If an independent contractor selected in the survey sample purchased a sampled drug at a price higher than the final concessionary price, this will be picked up by the margins survey. This is then factored into the overall retained margin survey result and is offset against any excess margin made on other sampled drugs.

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