Pharmacy crying poor – the Pharmacy Guild and big pharma both call for government support

Australian pharmacy bailoutIt seems that everyone is putting their two cents worth as the 6th Community pharmacy Agreement (6CPA) is being negotiated.

On 31st March the Pharmacy Guild of Australia stated that the April 1 price cuts on medicine would put further financial pressure on community pharmacies at a time when they are already under economic stress while attempting to main services and jobs.

Then, on 1st April (and no, probably not intended as an April fool’s joke) the CEO of Medicines Australia Tim James said that the decline in pharmaceutical exports from Australia shows that we are just not competitive in the global market.

Mr James said that “the decline in Australian pharmaceutical exports comes at a time when the global market for medicines and vaccines is booming. It is already worth over US$1 trillion per year in sales, and is expected to nearly double in size by 2020.”

Mr James said that in 2014 Medicines Australia had partnered with AusBiotech to submit a joint proposal to the federal government to take steps to build a stronger pharmaceuticals industry in Australia. These steps included:

  • 6th community pharmacy agreementensuring a stable, predictable and efficient business operating environment,
  • strengthening Australia’s intellectual property system,
  • enabling growth in Australia’s local biotechnology sector, and
  • enacting globally competitive incentives such as tax breaks to encourage investment

This latest round of controversy in the lead up to the 6CPA agreement comes after the dust has hardly even settled on claims from News Limited journalist Sue Dunlevy that the Pharmacy Guild is creating “taxpayer funded millionaires.” The Guild responded saying that this take on pharmacy is a malicious fantasy.

The Guild has said that even before the April 1 cuts, the government remuneration per prescription for pharmacies (which is partly linked to the price of the drug), has dropped below the levels last seen in 2009 while the cost of running a pharmacy has continued to increase.

Amanda – Founder My Health Career.

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Image:    Ken Teegardin – Flickr

Image:    Steven Depolo – Flickr

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  1. Laverne Baulch says:

    Sue Dunlevy is not a well researched journalist .
    She quoted gross pharmacy income before wages rent and other business overheads
    Pharmacy employees depend on the Pharmacy at least breaking even as average gross profit is $650,000 but average expenses are $600,000
    Sue quoted gross profit not Nett profit.

  2. Mr Pharmacist says:

    So I guess that the average pharmacy net profit is $50k
    What is the average service entity net profit?
    I have owned a pharmacy and can tell you that the profits are there, and that even with changes that have happened, the controlling pharmacists (ie the ones who control the best businesses in the best locations, protected by antiquated rules which give them monopolistic competitive edges) are laughing to the bank. There are some struggling, the same ones who overpaid, because they thought the gravy train would never end,

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