Community Pharmacies

Rachael Maskell Excerpts

Wednesday 2nd October 2019 Westminster Hall

[Rachael Maskell (York Central) (Lab/Co-op)]

It is a pleasure to see you in the Chair, Sir David. I thank my hon. Friend the Member for Halifax (Holly Lynch) for securing today’s debate.

A couple of weeks ago, I went to visit a local community pharmacy in my constituency, and the superintendent pharmacist sat me down to tell me his tale of woe, which has been echoed across the Chamber this morning. He runs seven pharmacies across the city, serving 20% of the population, but he has seriously struggled over the past three years and is wondering whether he will be there next year. He has ploughed in tens of thousands of his own money just to keep the business afloat. That certainly highlights how many single-handed pharmacies have closed in the city.

Part of this is about the Government funding cuts, not least to the establishment payment, which covered things such as rent, regulatory registration and insurance. Part of it has also been about the loopholes for the clinical commissioning group and how it is now buying branded generics and not giving the headroom that pharmacies used to have. For instance, if people were purchasing a drug at, say, 60p and it had a value of 90p on tariff, there would be headroom of about 30p. That money was then ploughed back into the business to run other essential health services and to ensure that there could be free deliveries of pharmaceutical products to the community. Pharmacies just do not have that headroom any more.

The situation is made far worse by the multinational companies—we have heard about Boots, Lloyds and the others—which have the buying capacity and the space to be able to drive up the price at the wholesalers, which in turn means that the independents pay more when they go to purchase their pharmaceuticals. I have always called it the Walmart model, because that is how many of these companies operate. They try to push out the competition by making it impossible for the independents to participate in the market. That is certainly what we see here.

There is a toxic combination of cuts, CCGs facing tough financial lines—the CCG in York is always struggling—and, on top of that, the wider market pressures. Of course, the multinationals can spread their risk. They sell other products, and they are owned by multinational corporates, which gives them a further cushion in their operations. The impact is that, where some of those big companies have bought up independents, they are then closing them in crucial communities.

Clifton in my constituency is an area of high deprivation, with one of the lowest ages of mortality in the city and a real need for a community pharmacist, but Lloyds has pulled out of that community. That means that while people are waiting, say, three weeks to go and see their GP, they cannot just pop down the road to their community pharmacy as an alternative, because it is simply not there.

That is building more pressure on the independents, because people go to them to get the free delivery now that, as we have heard, the big companies have seen a gap in the market—surprise, surprise—and are charging their drug delivery tax to get more resource. That means that the independents, which are trying to provide that community service, are delivering further and further afield, which is costing them more, and they have less resource to do that with. We need to address the drug delivery tax to ensure that, as my hon. Friend the Member for Halifax set out, we get these products to those people in our communities who are incredibly vulnerable.

I draw the Minister’s attention to one other scandal in the industry, which is that companies such as Boots are paying only 9% corporation tax. As a result, the Government are losing out on £1 billion a year. If we think about the scale of the cuts and the £200 million that has been removed, it does not take long to realise that, if Boots was forced to pay its corporation tax, we would not see pharmacies struggling and going to the wall, or communities suffering and losing those essential community services.

I ask the Minister to go back to the Treasury and make sure that those tax loopholes are closed. Boots moved into a multinational company, which I believe is 49% American-owned, and it is now registered in Switzerland, so it does not have to pay the same overheads. That is another inequality built into the market that must be addressed. The pressure cannot continue, or we will lose our community pharmacies. As I said, one pharmacist, who oversees seven pharmacies, does not think he will be there next year. That is seven communities across my constituency and York Outer that will not have a community pharmacy on the street corner.

It is vital, therefore, that the new Minister gets to grips with this issue. She must make sure that the right investment goes into our communities, that those loopholes are closed for the CCGs and for tax, and that the drug delivery tax is not put on pharmaceutical products.

--- Later in debate ---

[Jo Churchill]

If the hon. Gentleman will just bear with me for a second, he will hear me largely repeating what the right hon. Member for Rother Valley said when he so beautifully laid out the skills and expertise that lie in the pharmacy sector, and how they can be utilised better.

As I said, the deal sets out a programme of work we shall be working on. Our aim is that collaborative working across the system will deliver an integrated and accessible community health service for all. I want to name-check the hon. Member for Strangford here because, as he articulated, communication lies at the centre of this issue. One instance might be the digital expertise that the hon. Member for Washington and Sunderland West said exists in Gateshead, where people’s greater readiness to get services from pharmacists, and the fact that pharmacists can do more, is having a positive effect for patients.

First, pharmacists told us that we must utilise and unlock the potential of the highly skilled pharmacy teams that are embedded in communities throughout the country, including in the constituency of the hon. Member for Halifax, with everyone celebrating what pharmacists can deliver. That is why the settlement aims to deliver more fulfilling, patient-facing careers for community pharmacists and technicians, as highly valued members of the NHS team. Additionally, populations will be helped by much better services.

Secondly, pharmacists told us that they wanted continuity. The settlement funding over five years gives certainty, and gives community pharmacists the confidence to invest in their business. However, there is no one size fits all. Being in the centre of a town is not the same as being in a rural village. Looking at these things in the round is why we want this to be collaborative.

[Rachael Maskell]

How will the Minister measure the impact of the settlement, particularly on independent pharmacists? If more of them close or are struggling financially, what other interventions does she plan to make?

[Jo Churchill]

As I said, there is no one size that fits all. As the hon. Lady articulated in her speech, the difficulty is that we are not looking at a system where businesses are run on the same scale model. At any one point, there are single pharmacists. She stated that the pharmacy she visited was part of a seven-strong business. Then there are the multiples. We need to look at what is the best scheme. However, I would argue that independents have a much higher footfall from their local population, because they are more trusted than many of the multiple pharmacies due to the continuity that comes from their having been in their communities for longer. There are opportunities there for independents.

We know we will need to design new ways of working to make a success of this, and we will need patients to be confident in how they use the services. The enhanced role for community pharmacy will support patients in getting access to help where required and in using the NHS in the best possible way. When people are suffering from minor conditions such as earaches or sore throats and need health advice, we want them to think “Pharmacy First”.

We want to build on that, with other parts of the NHS proactively signposting to local pharmacists. We want everyone to recognise the high-level skills held by pharmacists and to get people to understand that we need them as a first-line service to go to. That will grow trust in the system and spread the load. We will, of course, need to reform the way we work to free up pharmacists’ time so that they are able to deliver these new services.