New Pharmacy Laws Could Entrench Big Players: RACGP

The new laws keep limits on pharmacy ownership that only allows pharmacists to own individual stores.

A Pharmacy in southside of Brisbane is seen on May 14, 2015 in Brisbane, Australia. Bradley Kanaris/Getty Images

New pharmacy laws in Queensland will create barriers for patients seeking more affordable medicine and entrench bigger operators, according to the Royal Australian College of GPs (RACGP).

The state government passed the Pharmacy Business Ownership Bill on March 22, which seeks to replace the outdated Pharmacy Business Ownership Act established in 2001.

The new law keeps limitations on pharmacy ownership, stipulating that only pharmacists or their close relatives can own or manage them, intending to ensure those in charge of pharmacies have the necessary qualifications and expertise.

Notably, pharmacies are one of the few industries where only a pharmacist can own a store, unlike other healthcare businesses. For instance, a pharmacist can own a general practice, but a GP can’t own a pharmacy.

Among the new laws, a newly established council will oversee compliance with the regulations, which was previously managed by Queensland Health.

Further, the law prevents anyone outside the pharmacy (third parties) from controlling how pharmacy services are provided, voids agreements granting them control, and mandates the council to report on audits ensuring compliance.

RACGP criticised the Queensland government for ignoring its pleas to modernise the outdated regulations which would open up competition, and reduce consumer costs within the sector.

“Again and again, we have urged the government to overhaul outdated and anti-competitive pharmacy ownership and location laws. These laws limit competition and make it harder for patients to access discounted pharmacy services, resulting in higher costs and limited choice,” Queensland Chair Dr. Cathryn Hester said in a statement.

Concerns for Indigenous Health

There have also been some expressed concerns that new laws prevent Aboriginal and Torres Strait Islander community-controlled health organisations in Queensland from owning and operating a pharmacy, which hinders efforts to enhance outcomes for these patients.

AMA Queensland pointed out the laws ignore the state’s commitment to closing gap targets, including one aimed at ensuring Aboriginal and Torres Strait Islander people have long and healthy lives.

“It is outrageous that the Queensland Government is completely disregarding its own Closing the Gap commitments with these unnecessary, anti-competitive regulations,” President Dr Maria Boulton said.

She urged the government to clarify why it prioritised lobbyists’ demands over Aboriginal and Torres Strait Islanders’ healthcare needs.

Smaller Players Could Lose Out

The new laws come into effect amid concerns from Greens MPs that after two decades, corporate giants like Chemist Warehouse could be monopolising the sector.

Chemist Warehouse’s share market has exploded, and is set to be publicly listed on the Australian Stock Exchange following its merger with Sigma Healthcare.

“As at December last year, 158 of the 578 Chemist Warehouse franchise pharmacies nationally were controlled by five key members of the Chemist Warehouse management team. Once this [bill] goes through, it seems we will have a full 10 percent of our pharmacies under the control of a listed corporation whose sole goal is investor profitability,” Green MP Michael Berkman said.

The RACGP’s Dr. Hester noted that it’s concerning to maintain the status quo for big pharmacy chains amid their looming profitability, especially when people feel the pressure of high living costs.

“People right across the state are struggling to afford to buy groceries and school supplies, fill up the car, book medical appointments and purchase the medicines they need,” she said.

She said the struggle will now be ongoing for Queenslanders, and they will “continue to miss out.”

“Existing pharmacy owners win, and you lose.”

Pharmacy Guild Hails Local Focus in Queensland Pharmacies

One of those lobbyists, the Pharmacy Guild of Australia, celebrates the passage of the bill as a “win,” saying it ensures pharmacy owners play fair because the council watches and enforces rules.

“I’d like to congratulate the government and the Parliament for passing this legislation,” Pharmacy Guild of Australia Queensland Branch President Chris Owen said. 

He said it will ensure pharmacy owners and consumers in all other states and territories of Australia receive the same clear information about pharmacy ownership.

“This Bill will safeguard the ownership of community pharmacies in Queensland to ensure pharmacies remain in the hands of pharmacists and not in multinational companies,” Mr Owen said.

“The passage of this legislation is a win for Queensland patients and will ensure local community members are front and centre in community pharmacy.”