English figures reveal the challenge facing rural dispensing

By Ailsa Colquhoun, 26th of November 2013

Controlled locations in England saw 42 pharmacy applications granted during 2012-13, which is the lowest figure for eight years.

In 2011-12, there were 163 applications granted in controlled areas, and 366 in 2010-11, show new statistics, General Pharmaceutical Services in England: 2003-04 to 2012-13.

From the statistics it is clear that the publicised end to the 100-hour pharmacy exemption in August, 2013 prompted a flurry of pharmacy applications in controlled areas.  During the first five months of 2012-13 (the final five months of the 100-hour pharmacy exemption), PCTs in England received 34 applications to open a new pharmacy in controlled areas, of which 29 (85.3%) were granted.

Seventeen (40%) of all controlled area applications granted during 2012-13 were for exempt pharmacies (2011-12: 18): 13 of these were for 100-hour pharmacies and two each for distance selling operations and out of town shopping developments.

Community pharmacy statistics: Looking at the pharmacy landscape more generally, NHS BSA reports that there were 11,495 community pharmacies in England at 31 March 2013, compared to 11,236 at 31 March 2012, an increase of 259 (2.3%). Since 2005, when the exemptions to the control of entry regulations were introduced, there has been an increase of 1,364 pharmacies (13.8%).

Ownership: At 31 March 2013, 38.6% (4,435) of the pharmacies were classified as independent – a market share that independents have maintained for four years.  However, the figures show that independent pharmacies are becoming larger – the very largest pharmacies (doing >10,000 items/month) have increased their share of the pharmacy market to 16%, up from 9% in 2006-07.

Service provision:  A total of 2.8 million Medicines Use Reviews (MUR) were conducted by community pharmacies in England in 2012-13, an increase of 386,287 (15.9%) compared to 2011-12.

Prescription volumes, fees and costs: Over the last ten years the number of prescription items dispensed has increased by 53.3%, the number of fees by 52.6% and the average number of fees per pharmacy by 29.5%. The average net ingredient cost (NIC) per fee has decreased for the eighth consecutive year to £8.37 in 2012-13, decreasing by 25.4 per cent (£2.90) since 2003-04.

This fall in the average NIC per fee was due to a combination of factors including:

  • The Medicines Margin Survey resulting in adjustments to category M generic drug reimbursement prices as agreed under the Community Pharmacy Contractual Framework.
  • An increase in generic dispensing rates (due to patent expiry and loss of exclusivity for a number of leading branded drugs) and the continued efforts to promote generic prescribing where clinically appropriate.
  • The Pharmaceutical Price Regulation Scheme (PPRS), which has resulted in a reduction in branded drug prices (with price cuts of 7% in 2005, 3.9% in 2009 and 1.9% in 2010). There were automatic permitted price increases of 0.1% from 1 January 2011, 0.2% from 1 January 2012 and 0.2% from 1 January 2013. 0% price increases have been agreed for 2014-16.