Deregulation to have little effect on chemist prices, says IPU

THE cost of goods sold in chemist shops will not be lowered by the proposed opening up of the market, the Irish Pharmaceutical Union (IPU) insisted last night.

Wed, 29 Jan, 2003 - 00:00

Mary Dundon, Political Reporter

The IPU was responding to a report which revealed the Pharmacy Review Group will be recommending a radical shake-up of the business here later this week. This proposed overhaul includes allowing pharmacists trained abroad to open up shops here and limiting the share of the market which multinational companies can secure.

IPU chief executive Seamus Feely said deregulation of the pharmacy market will have little impact on prices because there is very little scope for new chemist shops to open here.

“We already have more pharmacy shops per head of population than any other European country and deregulation of the business in the US actually caused prices to rocket to five times the cost here,” Mr Feely said.

The major price rise in the US was caused by the takeover of the pharmacy business by huge chain stores and the same thing will happen here, Mr Feely warned.

The Pharmacy Review Group has recommended that chain stores should only get 8% of the dispensing contracts given out by any particular health board to prevent a monopoly.

But the IPU claims this limitation would not stop chain stores gaining a dominance in the Irish market. Most of these multinationals already have businesses in high turnover areas. And even with 8% of the dispensing contracts they could control half the pharmacy business in any region because of their turnover, Mr Feely said.

The IPU believes a better way to control the spread of chain stores would be to follow the European model and insist on pharmacies being run by owners.

But the Competition Authority welcomed the proposals to deregulate the market and said they believed it would lead to lower pharmacy prices for consumers.

“If these proposals are implemented there will be more competition in the market which will lead to a drop in prices,” the Competition Authority spokesman said.