Relaxing pharmacy ownership rules could result in more pharmacy chains and poorer care

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When you visit a pharmacy, your main goal is probably to fill in your script or some advice on a counter drug. While you are there, you could also collect some cosmetics, sunglasses, toys, jellies or other items.

If you are an investor, the pharmacy is a way to make money, potentially a lot of money if you operate on a large scale. As the consumer thinks about convenience and health, the entrepreneur thinks about revenue and opportunities to reshape the rules for greater profit.

These profit opportunities are the basis of the Community pharmacy agreement, The regulatory framework for Australian pharmacies. Negotiations are currently underway for the seventh agreement, which will come into effect in the middle of next year.



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Last week the Australian Medical Association raised the issue of who should be authorized to own pharmacies and where they can be located. Doctors should, according to the AMA, be able to own pharmacies located in their clinics, for the convenience of patients.

Federal Health Minister Greg Hunt excluding relaxing pharmacy property rules, although the AMA states that it will continue to pressure state and territorial governments.

But deregulation of pharmacy ownership could establish the dominance of the main operators and favor a handful of health care companies that already have GP clinics, private hospitals, rehabilitation centers and tests.

What are the current rules?

In Australia, you are largely free to manage most retail stores anywhere. Three cafes could sit side by side, along with two bicycle shops and a barber.

A consequence of the National Health Act 1953 and the state and territorial law states that pharmacies are different, that's why you never see two in a row.

Status of position restrictions that when pharmacies move, they must do so within 10 km of the existing site.

The creation of a new pharmacy must generally be at least 1.5 km from an existing transaction.

We also have property restrictions. Pharmacies must be managed by a registered pharmacist. A single person or company cannot own more than five pharmacies. (Although the franchise – in which the individual owners pay for the use of a national brand like Amcal and for the services provided by the brand owner – offers this restriction.)



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The current regulations aim to ensure that most Australians have access to a pharmacy with highly qualified and pharmacy graduates.

Not having too many pharmacies in the same area, and therefore reducing local competition, it increases the probability that they will make enough profits to stay open.

This restriction is pragmatic, although it discourages free-market purists who believe fewer rules favor competition through lower prices and better service.

What could change?

One suggestion is that restrictions on pharmacy ownership should be removed to allow, for example, an individual (who is not a pharmacist) or a company to own an unlimited number of stores that operate as stand-alone stores or that are based in other commercial activities, including those outside the health sector.

Should the ownership of the pharmacy remain reserved for pharmacists?
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This proposal is from interest in companies that run medical clinics, private hospitals and other services such as pathology laboratories.

It is also interesting for companies like API (Australian Pharmaceutical Industries), which currently own some pharmacies and determine the operation of many others through franchising.

The API Group is the parent company of 420 Priceline pharmacy stores, 100 Soul Pattinson pharmacies, 72 pharmacies and pharmacist consulting affiliates.

The competitor of the API Sigma Healthcare distributes through 700 pharmacies, with the brands Amcal, Guardian, Discount Drug Stores, Chemist King and PharmaSave.

Why should you worry?

Relaxing rules of ownership risk pharmacies that replicate the corporatization of health services, such as GP clinics and disease providers, where companies have numerous locations throughout Australia in the same way that there are a KFC and McDonalds in all major centers.

Just like the GP chains deleted many smaller and more independent practices, such a move to the pharmacy could mean the death of the local chemist and the highest quality and the most personalized assistance you receive.



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Discount chemists are reducing the quality of the pharmacy along with the price


Changing the rules on the ownership of pharmacies located in medical centers also risks accelerating the transition to "factory medicine", with customers processed as quickly as possible (with little time wasted on advice or empathy) and persuaded to buy goods like herbal or vitamin products that most people don't need.

Discussions should not only involve the privileged

Negotiate the seventh as a pharmacy and health department official Community pharmacy agreement behind closed doors, we need a public debate on the ownership of the pharmacy and the localization rules and the implications of these changes.

The ownership of the pharmacy should remain reserved for pharmacists, provided a the pharmacist is on the spot drive customers?

And should pharmacy ownership be limited to five stores? Or should it be completely open, so that if you have the resources you could have a bottle shop, a tire shop, a pharmacy and a supermarket in every city and in the main suburbs of all of Australia?

In the latter case, pharmacists will have to resist the pressure of company owners to sell homeopathic and other products that do not work or risk losing public confidence in the pharmacy profession.



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The former head of the ACCC Graeme Samuel suggestion that regional cities could have a combined post office, bank and pharmacy create a good soundbite but the reality could be very different.

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