Pharmacy ownership rules “irrelevant”

Chemist Warehouse Woden, September 2013.
Chemist Warehouse believes there is not enough competition under the current pharmacy model.

Chemist Warehouse’s market power is leaving existing rules exposed, national newspaper claims 

The recent deal between the My Chemist/Chemist Warehouse Group and EBOS Group has revealed both the market power of CWH and the irrelevance of existing pharmacy ownership laws, a national media column has claimed.

The Australian Financial Review’s Chanticleer column said yesterday (3 July) stated that “the spirit of the ownership limit law is now being broken in every state by a number of chemist retailing groups”.

In what may be the first shot in the lead-up to 7CPA negotiations, the article said “It is obvious from the networks of retail pharmacies operating in Australia under various national brands that the decades-long campaign by the Pharmacy Guild to protect pharmacists from supermarket-like operations is a complete failure.”

“The Guild… has been powerless to stop multiple groups building pharmacy chains which threaten the earnings of Guild members.”

In response, the Guild said it was “determined to ensure that the pharmacy ownership rules are maintained and enforced.

“In every State and Territory, these laws prohibit anyone other than a registered pharmacist from owning a community pharmacy.

While the laws differ slightly between jurisdictions, their intent is the same. Lawmakers around Australia have made clear that pharmacists – not big corporations – should own and control community pharmacies”.

A Guild spokesperson said it had been encouraging all pharmacy registering authorities to ensure proper scrutiny of applications for approval.

Pharmacy ownership rules have come under criticism in the last year with Ramsay Healthcare having said that “ensuring the safe and competent practice of pharmacy and related services does not require a registered pharmacist to own a pharmacy”.

In addition, the switch of MC/CWH supplier from Sigma to EBOS demonstrated the market power of the former, Chanticleer claimed. 

“It has managed to lever its market share of 7 per cent of the national pharmacy network… into a 25 per cent share of the overall market by revenue,” the article said. 

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