Pharmacists being ‘pushed over a cliff’
It was back in 2002 that Dermot Twomey addressed 150 pharmacists at a meeting in Cork and warned them that the good times would not last forever.
The treasurer of the Irish Pharmacy Union (IPU), the pharmacists’ representative body, told them that the fees generated from dispensing medicines under the state drugs schemes would not remain as high they were.
‘‘I knew things had to change, but I had no idea that the minister for health would try to push an entire sector over a cliff,” Twomey told The Sunday Business Post last week.
Yesterday marked an escalation of their dispute over fees, with hundreds of pharmacists withdrawing from dispensing medicines under the state drugs schemes, due to what Twomey described as the minister’s ‘‘gross abuse of a dominant position ‘ ‘ and ‘‘disproportionate cuts’’.He said pharmacists had been inundated with calls from patients concerned about their future supply of medicines; that people were ‘‘stockpiling medicines’’; that patients would have to travel long distances for medicines from this week onwards; that the elderly will be badly affected.
‘We were happy to renegotiate on fees, but there has been no dialogue. Nobody is talking to us. Since 2002,we have sent four or five submissions to the department regarding our fees.
They all sat on shelves and were ignored. We have been backed into a corner and we have no recourse to a third party, such as the Labour Relations Court. We were left with no option,” he said. Twomey cited a PricewaterhouseCoopers (PwC) report that shows the average net profit of pharmacies was 6.6 per cent, which he said was ‘‘not excessive’’.
He said that health minister Mary Harney’s move would wipe an average of €106,000 a year from the bottom line of each pharmacy – ‘‘not €82,0000 as stated by the minister’’.
That, he said, was unsustainable and would put hundreds of pharmacies out of business. ‘‘The government argues that we have too many pharmacies. The difference between what we have offered to do and what they are forcing through is not all that huge – yet it will push many out of business. It could cost the state around €71 million in social welfare payments alone, based on our initial projections of 5,000 job losses.”
Twomey said that in regard to medicines, ‘‘we have a competitive sector that is working well’’ – a claim that is likely to invite rebuttal through the fact that the cost of medicines in Ireland is among the highest in Europe.
Twomey defended his stance, saying the bulk of the problem was because drug manufacturers were being paid too much money. He said the dispensing fee paid by the state to pharmacists increased by 6 per cent between 2001 and 2007,whereas the average medicine cost per item increased by 48 per cent during the same period.
Although the Health Service Executive (HSE) no longer paid a premium price for many medications that are off-patent, the government has long been accused of failing to stand up to big pharmaceutical companies, because the sector is a big employer and an exchequer cash cow.
This may also be behind the state’s reluctance to embrace generic drugs, although Harney has vowed to introduce a system called ‘reference pricing’ that would incentivise the use of generic products.
Twomey said that if the state had been serious about reducing prices, the agreement with the Irish Pharmaceutical Healthcare Association – the body that represents manufacturers -would not have been as soft on manufacturing and would have looked at generics.
‘‘If they were serious about this business, they would not be spinning the line that they are removing money from the wholesalers, when it is indisputable that that money is coming out of our back pockets,” said Twomey.
Last year, the state paid €640 million to get medicines from the factory gates to the patient. Unlike virtually every other figure bandied about in this dispute, nobody challenges the veracity of that figure. The beneficiaries are the wholesalers who distribute the medicines, and the pharmacists who subsequently dispense those medicines to patients.
Harney said the cuts introduced yesterday would reduce that sizeable bill by €133 million. Twomey claims the true annual cost of the cuts was between €155 and €169 million.
‘‘They are dressing it up as a reduction to both wholesalers and pharmacists, but that is coming out of our pocket. The wholesalers have not agreed to any cut,” he said.
Twomey said one of the fundamental problems in the current dispute is that Harney ‘‘simply does not realise what is involved in our jobs’’. He said it was inaccurate to portray pharmacists as simply retailers.
‘‘Just to give you an example: last week I opened my dispensary and I saw three people in a row who wanted me to look at a rash on either themselves or their child.
‘‘I was able to ascertain whether it was serious or not and whether they needed to go to the doctor. I was able to give them the appropriate advice or relevant product. So, I effectively freed up space in a GP’s waiting room,” he said.
Twomey said he regularly cross-referenced medicines prescribed for patients to ensure nothing is counter-indicative. He said the minister had shown ‘‘no vision whatsoever in terms of what pharmacists can do, compared to other countries’’.
‘‘We could be operating minor ailment clinics, as pharmacists do in other countries,” he said. ‘‘We could be generically substituting [dispensing cheaper generic drugs as opposed to more costly brand name drugs], and even prescribing ourselves within certain protocols. Instead, the sole focus is the dumbing-down of pharmacy.”
Twomey said the ability of pharmacists to survive the cuts would depend on when they themselves were born and on their business strategy. ‘‘I was born in 1970. I have 10 or 11 good years behind me. Someone born in 1980 who wants to do what I have done has probably bought at the top end of the market and will find things very difficult.”
He said the average pharmacy generated between 55 and 75 per cent of earnings from prescriptions. About 10 or 15 per cent is over-the-counter sales and the balance is cosmetics and perfumes.”
Just how long pharmacists can remain out of the community drugs scheme remains to be seen. The plight of those who have withdrawn from their contracts has not been helped by the fact that others have not, making the mass pulls-out disjointed.
Twomey acknowledged that this had caused bad feeling in the sector. ‘‘To be honest, I think many pharmacists believe they will go under whether they dispense or not. People have been backed into a corner and have nowhere to turn. Isp oke to a pharmacist the other night who said it wasn’t a question of if, but when he would close the door and throw away the key,” he said.
‘‘This is part of the health service that works well. It is a well-regarded service. Why decimate it?”
