Another inquiry suggests deregulation

The Government should “reconsider its commitment to the Pharmacy Rules,” a Senate inquiry into red tape has found

The Select Committee on Red Tape has handed down an interim report in which it makes six recommendations, including the investigation of options “to enhance competition in the delivery of pharmaceuticals listed on the Pharmaceutical Benefits Scheme, with priority given to consumers rather than pharmacy owners”.

Another recommendation is that through the Council of Australian Governments, the Federal Government should review the ownership rules and “whether they serve the interests of the public rather than established owners”.

The interim report identifies the pharmacy rules as “the area of most concern” in submissions, with stakeholders such as the Grattan Institute and Rhodes Management suggesting that the rules limit the number of pharmacies and where they can operate.

The Guild’s submission highlighted that the current model enjoys significant community support while the PSA’s Shane Jackson had indicated to the Committee when questioned that the effect of the Pharmacy Rules is definitely an issue for some PSA members.

However, Dr Jackson told the AJP that “yes, some of our members have cited that location rules have been a barrier”.

But “the PSA supports the concept of location rules,” he says.

The interim report noted that the Pharmacy Rules are intended to support consumer access to medicines, but “the argument that this is aided by placing limits on the location of pharmacies is difficult to sustain”.

“Clearly, it is of considerable benefit to existing pharmacies and makes the establishment of new pharmacies quite difficult.

“The committee understands that, despite multiple reviews favouring change, the Australian Government has chosen to disregard calls for more competitive and consumer-oriented arrangements.

“Information presented to the committee reinforces these calls for reconsideration of the Pharmacy Rules to ensure they remain fit for purpose.”

The interim report says the Committee “questions whether limits on the number of pharmacies that may be owned by an individual pharmacist or company are in the public interest”.

“The Committee understands that this is exceptional regulation in that there are no such limits for comparative professions (such as veterinary and dental practices),” it says.

It also recommended the investigation and consideration of options for progressing uniform medicines legislation.

The Committee also recommended that the Government investigate options to align the payment of GST with business practices, due to the cash flow impact the tax has on small business.

“The Committee heard that pharmacists are diverted from their core duties due to intervening red tape issues, many of which are within the purview of the Australian Government.

“The Committee considers that it would be beneficial to relieve this pressure, commencing with a focus on GST issues.”

And the Committee found that community pharmacies should not be exposed to costs attributable to wholesalers which are passing on costs arising from Government-imposed obligations.

It also recommended that the Government investigate the extent to which pharmacies are exposed to “unnecessary costs” as a result of Government policy on pharmaceutical benefits supply.

It recommended that the Government develop a centralised electronic system for the PBS Safety Net, and consider the proposal for two new digital portals to track the prescribing and dispensing of medicines as well as trading, tracking and supplying them on the PBS and RPBS.

A spokesperson for the Pharmacy Guild told the AJP that “there are some suggestions worth taking a look at in the report, but not in relation to Location Rules”. 

“The Guild welcomes the bi-partisan support shown last week for the removal of the sunset clause in the Location Rules, ensuring that the rules continue to benefit consumers through the maintenance of a viable national pharmacy network.”

Access the interim report here.

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