Pharmacy pushback on direct supply

Direct supply increases workload and costs for community pharmacies, argues the Guild – and most pharmacists agree, according to an AJP reader poll

Exclusive direct supply arrangements not only double the workload for pharmacists, but potentially threaten the very stability of the medicines supply chain, argues the Pharmacy Guild.

The Guild has been lobbying decision makers about the issue after AstraZeneca and Amgen recently joined Pfizer and other manufacturers in deciding to supply their medicines directly to community pharmacies.

It says such arrangements can have a “flow-on” impact for pharmacies, patients and the medicines supply chain.

“They can increase the complexity, workload and cost for pharmacies in managing the safe and timely supply of medicines to patients,” says Guild executive director David Quilty.

“Every time a manufacturer opts for exclusive direct supply, pharmacies face the prospect of having to deal with duplicated ordering, delivery, invoicing and payments requirements.”

The Guild argues that CSO requirements provide requirements and safeguards that cannot be guaranteed if a medicines company bypasses the full-line wholesalers.

Companies operating outside the CSO are also not required to maintain prices, meet delivery standards and are not restricted in adding fees and charges, says Mr Quilty.

“Because there is no requirement for an exclusive direct supplier to supply at or below the price to pharmacy, pharmacies can potentially face the invidious prospect of having no choice but to meet their professional obligation to dispense a medicine to a patient, while making a financial loss.”

Based on an AJP poll of 300 voters, our pharmacist readers seem to agree with the Guild’s line.

The results 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

“Those are strong poll results which are in line with the Guild’s strong views in exclusive direct supply,” says a Guild spokesperson.

“We strongly support mandating the availability of PBS-listed medicines through the full-line wholesalers.”

Amgen has responded that its intent is not to increase complexity by making its osteoporosis biologic Prolia (denosumab) available via direct supply.

“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 tells AJP.

“Community pharmacies are able to order Prolia via various platforms including their usual point of sales system (POS) and DHL Istore.

“Amgen has a dedicated pharmacy team working to support community pharmacies, and are reaching out proactively to help them manage their ordering effectively,” says the spokesperson.

“We have been actively engaging with and listening to the feedback that has been provided by pharmacists. Our commitment is to continue to work closely with community pharmacy through the transition.

“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 has also been contacted for comment.

The Pharmacy Guild maintains that the best possible scenario is to have all PBS listed medicines made available through the full-line CSO wholesalers.

“Under the CSO, full-line wholesalers must ensure that they supply PBS medicines to pharmacies in accordance with regulated service standards and compliance requirements,” says Mr Quilty.

These requirements are overseen and enforced by an independent agency which monitors compliance and conducts audits of the CSO distributors, he says.

“When a medicines company decides to bypass the full-line wholesalers by instituting exclusive direct supply arrangements, it operates outside the requirements and safeguards of the CSO.”

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