The fact that the Government has decided to act quickly on generics prices (see p642) should have come as no surprise. The volatility of the generics market has led to large increases in the drugs bill and to local prescribing budgets being greatly over-spent.
Quite how the situation came about has been a matter of some speculation - the suspension of the manufacturing licence of a leading supplier, the collapse of the patient pack initiative and exploitation by entrepreneurs have all been mentioned - but it is reassuring to note that pharmacy contractors are not being criticised. Lord Hunt (the Health Minster responsible) has indicated that he believes that pharmacists have acted responsibly in relation to the shortages. Contractors generally were, it is now clear, unwilling victims of a situation created by others.
That being so, it is essential that they do not become unwilling victims of the solution being proposed. The Government needs to deal with some key specific issues to prevent this from happening.
The first thing that needs to be dealt with is the loss that is bound to be incurred by contractors when the new maximum prices that the Government wants to bring in are implemented in July. By the very nature of what is proposed, the new prices are bound to be lower than the prices previously in force. So, if nothing is done, contractors are certain to lose money. Some means of meeting the loss in an equitable manner must be found. Not only that, but contractors must be left in no doubt that the matter has been dealt with.
Something else that needs to be sorted out is what is to be done when shortages of particular medicines occur in the future, as they will do, since no supply system can ever be perfect. It could be that a brand will have to be supplied in some instances. If that is so, there will have to be a mechanism for it to be paid for. Contractors must not be put in a position where making a supply means that they suffer a financial loss and that the only way that they do not do so is to decline to make the supply.
It is not possible to give a view at this stage on whether or not what the Government is proposing is a good thing or a bad thing. It all depends on how the Government deals with the concerns that will be expressed by contractors' negotiators. However, we should not have to wait long to get the answer. Negotiations will commence on May 2 and there is not a great deal of time left before the Government takes action. It intends to have the necessary regulations laid before Parliament in June.