Our correspondent discovers some surprising similarities with the dental profession and wonders when the DH will get its act together over generic pricing.

Many of us would claim to have been affected by the law of unintended consequences at some point in our working lives. I was reminded of this when the Companies House monthly newsletter popped up in my in-box last month. It had evaded my GDPR-inspired cull of email subscriptions, and was heading for the trash bin when a headline caught my eye: ‘Corporate dentistry... big business?’

Sound familiar?

The author of the item, Alan Suggett, kicked off his piece by telling us that in 2006 the law changed to allow dental practices to be operated as ‘Dental Bodies Corporate’ (sound familiar?). Before 2006, dental practices could only be operated by dentists as sole traders or partnerships. Was this a move to encourage a cottage industry to blossom and grow into big business? wondered Suggett.

‘Cynically, there is an argument for the NHS to commission NHS dental contracts from a handful of large corporates rather than thousands of small practitioners’, he continued. ‘Competition between providers would be preserved, but without the hassle of dealing with many different contract holders’.

If this were the case then surely there would be evidence of NHS commissioners making it increasingly difficult for smaller providers to obtain contracts? This is exactly what is happening now with NHS England seeking to introduce a ‘Dynamic Purchasing System’ (DPS) for orthodontic procurement across the south of England.

The British Dental Association thought DPS to be so unfair that it sought a judicial review. Its legal challenge has been suspended while NHS England undertakes preparatory work for the procurement of orthodontic services, due to be introduced in March 2019. Predictable?

Closer to home in March, NHS England  approved guidance to CCGs that restricted the routine prescribing of OTC medicines for 35 self-limiting minor ailments. My immediate response was that I might, over time, see some small uplift in my OTC sales.

But then I read that CCGs in Derbyshire are no longer commissioning a minor ailments service (MAS). Predictable? Yes, although I confess I didn’t see that one coming, obvious though it now seems. MAS were pretty much kicked into touch last year when it was revealed at the All Party Pharmacy Group that such services no longer have official blessing.

And then we have the unintended consequences of the long running shortage of generic medicines. The cynic in me says this is just a rehearsal for the shambles that is likely to follow Brexit.

Such was the magnitude of the NHS overspend on generic medicines that it attracted the attention of the National Audit Office, which reported on its investigation last month. The impact of the shortages is dealt with extensively, but the underlying causes get far less attention, which is a shame, since political and regulatory actions would seem to be largely behind the problems we have been having.

Three main causes are identified by the Department of Health (DH). These are: the MHRA and European regulators partially suspending the licences of three manufacturers of generic medicines; a fall in the value of sterling (due to Brexit); and, lastly, governments putting downward pressure on the price of generic medicines..

At the sharp end

And what about the impact at the sharp end? The number of requests from pharmacies for concessionary prices increased from fewer than 150 a month before May 2017 to a peak of 3,000 in November 2017. Despite this, in 2017-18, the Department granted only 709 concessionary prices, up from 282 in 2016-17.

Predictable? May be not so easy to call, but certainly expensive, and the pain just keeps coming. The problem with being at the end of the NHS supply chain is that you have no way of passing the costs on.

The unpredictability of Cat M prices in the current environment just makes things worse. To find, at the start of the month, that I am going to be around 17p per item, roughly £1,000 worse off for scripts I dispense in July doesn’t help.

If the DH is going to set prices for generics it needs to do so more accurately and in a more timely manner.

And I find it pretty immoral that some wholesalers appear to be making a quick buck at my expense. Even our friends at the DH picked up on the fact that the margin between wholesalers’ buying and selling prices ‘unexpectedly increased‘ at the back end of last year. I am positively spitting to see the DH admit that the NHS might not be able to get back the expenditure fromthe increase in wholesaler prices, but is quite happy to clawback every bloody penny from me!

No doubt the regular Business Barometer column in ICP will report that the demand for pharmacy businesses continues to be strong. Am I on the same planet? I just feel tied in and tied up at the moment.