CWH: location rules “indefensible, nonsensical”

Chemist Warehouse
Image by Francisco Anzola

Chemist Warehouse has strongly argued against location rules and removal of the $1 co-payment discount in its interim report submission

Group commercial manager Damien Gance has written a response to the Review of Pharmacy Remuneration and Regulation Interim Report on behalf of all proprietors of the discount pharmacy giant.

He begins by condemning the interim report’s suggestion that the government should abolish the $1 discount on the PBS patient co-payment.

“Access has three distinct dimensions: accessibility, affordability and acceptability,” Mr Gance writes.

“[We] contend affordability in so far as it relates to access is in no way benefited nor enhanced by enforcing a blanket prohibition on discounting of a patient’s co-payment.

“If, for someone in financial hardship, a pharmacy wishes to reduce the cost of a patient’s medication in order to provide ongoing access and to assist them with their medication compliance, this proposal would prohibit such compassionate acts. How could this possibly be deemed improved access?

“Discounting of PBS patient contributions does not create inequity; it creates competition,” says Chemist Warehouse.

“Affordable medicine is not about stropping price reduction, it is about stopping price increases… PBS patient payment discounting must be allowed to continue.”

Chemist Warehouse also argues vehemently against location rules in its submission, claiming the rules are the “root cause of Chemist Warehouse’s inability to provide competitive prescription pricing to every Australian”.

“Removal of these antiquated, anti-competitive and nonsensical rules will immediately free up Chemist Warehouse to bring its competitive pricing to many of the communities for whom we are currently unable to serve.

“Chemist Warehouse contend that the market distorting effects caused by the [location] rules product results that are plainly inconsistent with the National Medicines Policy.

“Their continuation post this review is indefensible.”

The group also lends its support to the sale of complementary and homeopathic medicines, arguing against suggestions such as product segregation, signage, and pharmacist explanation of goods.

In its submission Chemist Warehouse presents the following main arguments:

  • A blanket prohibition on discounting of a patient’s co-payment would lessen access to medicines.
  • Pharmacy location rules are anticompetitive and prevent Chemist Warehouse from providing competitive prescription pricing to all Australians.
  • Product scheduling clearly delineates scheduled medicines from complementary medicines, and if there is a failing in understanding this should be amended through a public education campaign performed by the government, not through enforcing a merchandising standard.
  • Complementary medicines do not pose a risk to consumers when they are not clearly separated from Pharmacy Only and Pharmacist Only medicines.
  • There is no reason why pharmacies should not be able to sell homeopathic medicines.
  • The Panel’s case for the removal of the CSO will lead to greater profits for pharmaceutical companies, and greater costs for medicines that will then be passed on to the patient or government.
  • That any future CPA negotiations must also include Chemist Warehouse. Mr Gance claims that the group’s proprietors are not represented by the Pharmacy Guild, Consumers Health Forum of Australia or the PSA.
  • Community pharmacy programs should be initiated, maintained, run and managed by “truly independent agencies”. Chemist Warehouse argues against the Pharmacy Guild’s QCPP program, saying it is “entirely inappropriate” for QCPP accreditation should be mandatory for access to government-funded pharmacy services when the program is run and owned by a non-independent, non-government agency.

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