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Distance-selling pharmacies feel aggrieved that they will no longer be able to provide NHS-commissioned services face-to-face from their registered premises. David Reissner examines whether the government could be guilty of unlawful restraint of trade…

When the Department of Health and Social Care announced with Community Pharmacy England (CPE) the new contractual framework, it said it had agreed with CPE to clarify that from October 2025, distance-selling pharmacies (DSPs) can only deliver advanced and enhanced services remotely, in line with the delivery of essential services.

DSPs are aggrieved by this and are talking about a legal challenge on the basis that such a change in the law would be an unlawful restraint of trade.

In a capitalist society, businesses are expected to be able to trade freely, subject to competition laws. However, when services are being funded by the public such as the NHS, there are always legal frameworks within which the services must be provided.

The National Health Service (Pharmaceutical and Local Pharmaceutical Services) Regulations 2013 are a typical example of this. These Regulations, which include the NHS terms of services for pharmacies, dispensing doctors and appliance contractors set out:

·      who can provide services

·      where services are to be provided

·      what services are to be provided

·      how they are to be provided and

·      how services will be paid for.

The very regulations are a restraint of trade because, for example, they limit the provision of pharmaceutical services to persons who are included in a pharmaceutical list, and the limit where pharmacies can open.

Ironically, DSPs are exempt from the restraints on who can open a pharmacy where. Restraint of trade does not feature much in court cases these days.

Interestingly, one of the key cases involving the law of restraint of trade involved the pharmacy profession. When the Pharmaceutical Society was the regulator, it proposed in the 1960s that new pharmacies would have to be situated in physically distinct premises and their trading activities confined to pharmaceutical and traditional goods, and existing pharmacies would not be able to extend their present range of non-traditional goods.

The case went to the highest court in the land, the House of Lords (before the creation of the Supreme Court). It was not in dispute that the proposals by the Pharmaceutical Society would restrain trade. The question for the courts was whether the restraint was justifiable.

The Pharmaceutical Society chose not to try to justify the proposed restraint, so its proposals were held to be unlawful.

The existing restraints in the Regulations on the provision of NHS pharmaceutical services do not break the law because the Regulations have been made under powers given by Parliament to Ministers in the National Health Service Act.

In my opinion, a court is only likely to overturn a change made to the Regulations if a judge can be persuaded that the change would be outside the powers given to Ministers in the Act.

David Reissner is chair of the Pharmacy Law & Ethics Association.