While discounts may provide more incentive for pharmacies to sign up, the Guild says it will continue to oppose exclusive direct supply despite attempts to “embellish” it

Following its November decision to provide Prolia (denosumab) via exclusive direct supply, Amgen has this week announced an update to its commercial offer.

Amgen is now offering:

  • Second orders per month of 1-3 units will be delivered free of charge, which it says “reflects Amgen’s efforts to better support pharmacies that may have smaller order requirements”; and
  • Additional discounts on larger orders, effective January 1, 2018, including:
    • 4-16 units: 2.0% on invoice discount (up from 1.5%)
    • 17+ units: 2.8% on invoice discount (up from 2.5%)

“Since we announced the change to the distribution model for Prolia on November 23, we have been actively engaging with and listening to the feedback that has been provided to us by community pharmacists,” said Amgen Managing Director, My Linh Kha.

“We remain committed to working with community pharmacy and providing support during this transition period.”

Ms Kha also said Amgen has established a dedicated pharmacy team, which she says is working “very hard” to support the transition.

“This team has been reaching out proactively to help pharmacies manage their ordering effectively and identify and listen to any concerns,” she said.

A spokesperson for the Pharmacy Guild has said the amendments do not change its stance on direct supply.

“Our position is we continue to oppose exclusive direct supply whatever arrangements might be put in place to embellish it,” the Guild spokesperson told AJP.

Just a few days ago, Guild National President George Tambassis stated that the organisation has been “inundated by angry members complaining about how the latest (and pre-existing) exclusive direct supply arrangements are making it harder to serve their patients”.

Mr Tambassis maintains the arguments that exclusive direct supply means medicine companies are “playing outside the established rules” of the PBS.

“Every medicine company that goes direct can set their own rules and they can all differ, not only in terms of the delivery standards but also ordering and delivery times, as well as invoicing and payment terms,” he said.

“The whole system becomes an unworkable mess for pharmacies which have nowhere to go because the arrangements are exclusive.”

Pharmacists seem to agree that exclusive direct supply makes things more complicated. A recent AJP poll of 300 voters found:

  • 81% (245 voters) say PBS listed medicines should made available through the full-line CSO wholesalers
  • 80% say direct supply increases administrative workload for community pharmacies
  • 64% say direct supply increases the costs for community pharmacies
  • 60% say having both non-wholesaling distributors and traditional wholesalers is too confusing and complex
  • 50% say direct supply discourages servicing to rural and regional areas

And only:

  • 3% say direct supply makes it simpler and easier for community pharmacies to buy drugs
  • 2% say direct supply encourages better servicing to rural and regional areas
  • 5% say having both non-wholesaling distributors and traditional wholesalers is good as it encourages competition
  • 6% say the CSO should be scrapped altogether

Amgen responded to the poll results by maintaining that its intent to switch to exclusive direct supply was not to make things more complicated.

“Our intent is not to increase complexity. The majority of community pharmacies in Australia are already familiar with the DHL ordering process and have adapted their ordering practices accordingly,” an Amgen spokesperson told AJP.

“Ordering is progressing very well with almost 10% of community pharmacies using the DHL Direct to Market Distribution Service to order Prolia on the day the new distribution service came into effect [on December 1].”

AstraZeneca also says it is committed to supporting pharmacies through the transition of some of its medicines to direct supply, which began on November 1.

“AstraZeneca is committed to supporting pharmacies through this change and prioritising the needs of patients,” a spokesperson told AJP.

“With the move to this new arrangement, our intention has been to minimise the impact on pharmacies as much as possible, however we recognise that there will be a period of adjustment.

“In defining the new distribution model, AstraZeneca was conscious to implement processes such as no cap on free deliveries, however we ask pharmacies to optimise their orders, and no administration costs are passed onto pharmacy.

“In addition, after monitoring feedback since launching this model, we made the decision to extend the order cut off time from 2pm to 3pm, for next business day delivery. This excludes a small number of pharmacies in remote areas,” the spokesperson said.

“We are committed to continuing to work with all stakeholders and have had regular interaction with the Guild, the Government and other key parties to support managing this change.”