Question to the Department of Health and Social Care:

To ask Her Majesty’s Government on what basis the Department of Health reimburses small independent chemists for NHS prescription drugs; whether they reimburse the full wholesale amount to chemists; and, if the full cost is not reimbursed, on what basis the payment is made.

The National Health Service pays community pharmacies that provide NHS pharmaceutical services a combination of fees and allowances for services provided and reimbursement for the products supplied as laid out in the Drug Tariff. The Drug Tariff is a compilation of determinations made by the Secretary of State and NHS England.

The reimbursement prices for products supplied are set in a number of different ways depending, for example, on whether the product is prescribed as a brand or a generic. For example, reimbursement prices for the most commonly prescribed generic products are set out in Part VIIIA of the Drug Tariff and are placed in categories A, C and M. The reimbursement price is established differently depending on the category in which the product is placed. For example, Category M prices are set using volume and sales data from suppliers.

The total of the reimbursement prices of products supplied by a pharmacy is subjected to a deduction as set out in Part V of the Drug Tariff. The size of the deduction is dependent on the value of the total of the reimbursement prices for that pharmacy. The larger the total, the larger the deduction. Each pharmacy providing NHS services, whether independent or part of a larger company, is paid in this way.