Pharmacies and the NHS

Steve Baker Excerpts

Wednesday 20th November 2013 Westminster Hall

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

It is a pleasure to serve under your chairmanship this morning, Dr McCrea. I congratulate my hon. Friend the Member for Ipswich (Ben Gummer) on securing the debate. I have tried on one or two occasions to get a debate on pharmacy, and he has beaten me to it and introduced the debate very successfully. No doubt he has more pull with the Speaker’s Office than I do. I thank the Minister for attending, too.

I got involved in the pharmacy story when in the 1990s resale price maintenance on non-prescription medicines became a big issue. The chief executive of Asda—I do not think that he was a Member at the time—was very keen to get rid of RPM on non-prescription medicines because he felt the market should be much more open. Quite a debate has taken place over the years on how to liberalise the pharmacy market in a big way.

At that time, community pharmacists were concerned about whether their trade would be reduced and the effect on their livelihoods. We must recognise that community pharmacies play a significant role in the high street economy. People are regularly drawn into town and city centres to spend money and visit the community pharmacy at the same time. I have followed developments with interest. I congratulate and support pharmacists, who do an incredible job. As the right hon. Member for Rother Valley (Mr Barron) pointed out, they are the first point of contact for people who need help.

I understand the concern of my hon. Friend the Member for Ipswich about the lack of liberalisation in the market and the need for transparency. I am always one for a lot of transparency—more sunlight normally produces it. During the 1980s and 1990s, the Conservative Government made sure that town centre retail developments and new supermarkets were assessed, to find out the implications for other supermarkets and food retailers. Regulation of town centres has been going on for a while. That was also to do with the sequential test.

[Steve Baker (Wycombe) (Con)]

My hon. Friend reminds me that we often complain that our town centres are in decline; he may have given us the reason.

[Oliver Colvile]

I agree that supermarkets have had an impact, but my point is about trying to protect small businesses in town and city centres.

[Steve Baker]

That is not quite what I meant. I pointed out that our town centres have been regulated for a long time, and that they are now in decline. Perhaps we should liberalise more consistently, and should have done so for a long time.

[Oliver Colvile]

The bigger issue, frankly, is car parking in town centres. Outside town centres people do not pay charges for car parking, but they do in town centres: so where do they go? In my constituency, I suspect that they end up at the Marsh Mills Sainsbury’s or elsewhere.

Two other big issues affect the pharmacy profession, one of which is the criminalisation of dispensing errors. If pharmacists make a mistake, they can be prosecuted and potentially sent to prison, whereas GPs, for whom I have a great deal of time, do not suffer the same prospect. The Department of Health is looking at that, and I hope that it will come to a conclusion on how we can equalise the situation and ensure a more level playing field.

The other issue is the sharing of data between pharmacists and GPs. I raised the matter during a recent statement from the Secretary of State for Health on the whole business of how pharmacists could play a part in helping to relieve accident and emergency units. The Government are keen to ensure that more and better data sharing takes place. I have a slight concern in that my understanding is that the process would be run by the Department of Health, but I recently read in an article that the Department was suggesting that the responsibility would lie much more with the local commissioning boards. If the Minister can respond to that confusion, that will be helpful.

We need to ensure that pharmacies play a much better role. They need to be the first point of call for people seeking help from professionals, as that would help to relieve GPs. During the summer recess, I visited the Keyham healthy living pharmacy, which is a brilliant organisation in a deprived community. Life expectancy differs by 11 years between the suburbs of Plymouth and Devonport, which is where the Keyham pharmacy is located. The pharmacy offers not only flu vaccinations, but also smoking cessation services and other such things. It is a service that certainly needs to be available.

Finally, there is concern about how we can improve how people feel about pharmacies to ensure that they are used in a much better way. If pharmacies were used to deliver flu vaccinations, that would take some pressure off our accident and emergency units over the winter. We have discussed an important issue this morning, and I am delighted that you, Dr McCrea, have been in the Chair to ensure that we get some positive comments.

--- Later in debate ---

[Steve Baker (Wycombe) (Con)]

I congratulate my hon. Friend the Member for Ipswich (Ben Gummer) on provoking a stimulating debate, and one in which I have learned a great deal. In particular, he emphasised the local impact that pharmacies can have, while the right hon. Member for Rother Valley (Mr Barron) clearly explained some of the opportunities that can be seized through pharmacies.

In Lane End in my constituency, a pharmacy opened alongside a dispensing GP practice, but if I remember the circumstances correctly, the practice was forbidden from serving local people; we had an absurd situation in which the purpose of the regulation made my constituents’ lives less convenient and less easy, in the interests of somehow distributing profit fairly. The debate has brought in some of the wider aspects for society and some of the things that a heavily regulatory state has messed up.

The purpose of prices, profit and loss in a market society is to guide individuals and voluntary associations into best serving society. If pharmacists wish to open a pharmacy, they should simply be able to do so, if they can find a place to do it, can do so within the law and are selling lawful products. They should be able to get on with it and serve whomever comes through the door. Instead, we have the situation described by my hon. Friend—people have to fill in a 200-page application form and might subsequently find themselves subject to particular restrictions on whom they may or may not supply.

One of the issues with a market system is that business men are profit-maximising, which is both a problem and a benefit. The problem is that business men do not like competition much, because that is what drives down prices and therefore profit. That is the crux of the matter. The purpose of the Government is not to entrench in law and regulation the tendency of business men to seek rent—excess income through capturing the state—but that is just what is happening when competition is inhibited by restrictions placed on a dispensing practice simply because a neighbour has opened a pharmacy. Certainly, on the siting of pharmacies, the Minister should seek to abolish rules and controls wherever he can, because they are getting in the way.

[Ben Gummer]

In my address, I omitted to mention the whole range of practice payments paid to pharmacists simply for, in effect, being open. The problem is that the opening of a new pharmacy creates a liability for the NHS to pay those practice payments, no matter who does or does not go through its doors. That shows the rather extraordinary situation that we have ended up with in respect of how pharmacies are remunerated.

[Steve Baker]

My hon. Friend is absolutely right and I am extremely grateful to him for bringing that up. We pretend that we live in a capitalist society—I have said this in the House before—but if our system is capitalism, I am not a capitalist. We have an absurd hybrid system, in which the state constantly intervenes in order to give people rents. It is peculiar that we call it a free market society.

The purpose of our all being here, of course, is to improve our constituents’ lives. When I say such things, my intention is to ensure that my constituents—all our constituents—have better access to pharmacies. In the House, we have a real consensus about an increase in the services offered by pharmacists being of benefit to all our constituents. What I want is for the Government to get out of the way, not to use taxpayers’ money to provide the payments that my hon. Friend mentioned and to allow pharmacists to get on and best serve the public in a way that is in the public’s best interests—a way that can be discovered only through experimentation and entrepreneurship.

On pricing, I want to make the point that in this country we are not good at haggling. We should haggle over prices and drive them down. The hon. Member for Strangford (Jim Shannon) talked about the scandal of some simple and inexpensive medicines that ought to cost pennies, but cost very much more. What I see at work there could be something that I witnessed when I was a contractor working with Government: Departments are not good at driving down prices. They tend to accept the price that they are given—“Oh, that must be the market price.” No—they should set the market price by demanding that they are charged less and, if suppliers do not provide the goods at a lower price, they should go elsewhere.

That brings me to generics and parallel imports, a subject touched on earlier. We ought to be making sure that the big pharmaceutical firms do not hold the NHS over a barrel. I have heard some of their arguments, and of course producing a new drug is an expensive business, but we should not be held over a barrel. In a market society, people should be held to account to drive down costs and drive up quality.

Johnson & Johnson, based in my constituency, has a wonderful credo, which was written when the basis of a free society was under threat in an earlier time. That credo sets out the principles on which the industry should be founded, and one such should be: no legal privileges, wherever possible.

[Oliver Colvile]

During the all-party group inquiry, we looked at that issue. One suggestion for easy identification of who was exporting and importing pharmaceutical products in this country was to look at VAT returns—when I ran a small business and was VAT registered, I had to fill in a piece of paper that recorded what level of EU trade I had ended up doing. I approached the Treasury on the matter, but it was not willing to participate and help, but that seems to me to be a way in which we could identify who the offenders are. We had some difficulty in identifying the offenders.

[Steve Baker]

My hon. Friend has identified what might be a missed opportunity because an enormous effort is going into preventing that fraud. With the opportunities that electronic communication offers today, it should be possible to use some of that information in other contexts. With that in mind, I will turn to the internet.

Clearly, everyone wants to ensure that prescribing takes place properly, but when people have been prescribed medicines it should be possible for them to buy over the internet in appropriate circumstances. I am particularly aware that homeopaths have had great difficulty with the internet because of the need for people to present physically to buy a medicine.

We cannot have it both ways on homeopathy—either the medicines are relatively harmless and can be treated with scorn by the medical profession, in which case they should be freely available on the internet, or they are dangerous and should be tightly regulated. Homeopaths’ experience suggests that people can take responsibility for themselves and buy products on the internet.

[Ben Gummer]

My hon. Friend touches on an interesting issue. Given the fact that the Government are going to great lengths to try to get GPs to do more consultations on the internet and Skype—great news for many of my constituents, especially those in busy jobs with difficult hours—it seems obvious to extend such innovation to the dispensing of pharmaceuticals.

[Steve Baker]

My hon. Friend is right. In the 21st century, we should be waking up to the opportunities to use technology to drive down costs and drive up service. People are so busy today, so why can they not have consultations in their offices with Skype, and why can pharmacists not prescribe to offices with Skype? The solution to these problems is for the Government to abolish whatever rules and controls they can and wherever they can, and to liberalise when abolition is not possible.

[Mr Barron]

The majority of patented goods that the national health service buys are a recognition not just of cost, but of the pharmaceutical industry’s worth to the British economy—including exports, manufacturing base and so on. We export around £7 billion of pharmaceutical goods a year. Might a free market endanger that?

[Steve Baker]

We may be in danger of straying into philosophically deep water about what free markets do and do not do. Clearly, because of the moral imperatives of health care, we cannot have an unimpeded market. We have made political decisions to ensure that no one goes without health care. That has consequences, and we should accept them.

The way to deploy scarce resources in the service of the public is to allow the price system, as well as profit and loss, to run as freely as possible. When we talk about something’s worth, price is too often ascribed to things that are not subject to market transactions. Only through exchange can it be established how people value things. I do not want to go on for too long, so I will leave that to another debate, perhaps the one on the Budget.

I want to encourage the Government to liberalise and to look more closely at what can be done to enable pharmacists to set up wherever they need to in order to serve the public best.