The legislation has remained substantially unchanged since 1964. We
were required to get through one of six gateways as the first hurdle to
succeeding [in retaining RPM]. The principal gateway we were trying to
get through was the one that succeeded in 1970, that significant numbers
of pharmacists would close as a sole and direct result of the loss of
RPM.
We had tremendous difficulties in obtaining clear evidence of this.
Predictive evidence today is based on economic modelling and complex financial
analysis. In 1970 these techniques were not developed and the approach
taken by the courts was impressionistic.
We employed the economic modeller who had won the Premier League case
against the OFT [Office of Fair Trading] and he did a tremendous job in
analysing returns from the surveys that some of you may have seen, and
other published sources of data. He provided some good material and also
provided analysis destroying much of the foundation of the OFT case.
What the picture began to show was that pharmacists that were closed,
and there are numbers of them, were closed for a number of reasons, including,
but not confined to, loss of RPM and the business loss that is going to
flow into the supermarket as a result.
The [members of the restrictive practices] court read carefully all
our evidence on this and heard oral evidence from some of our witnesses.
At the conclusion of that [the judge and two lay assessors] indicated
that they felt that we would not be able to prove our case on closures
to a sufficiently high standard to persuade them. As the onus was on us
to prove this and not on the OFT, this was fatal.
It also meant, given the way the legislation was written, that the court
could not consider the desirability of retaining RPM for pharmacists or
the damage caused by loss of RPM. That only arose if we could get through
a gateway. Interestingly, the judge said that it would be a bad thing
if pharmacists closed. It was not an unsympathetic court but it was a
court that thought we could not get through the evidential hurdle.
We met with our legal team to consider the implications of the court's
view and all of them were unanimous that to procedure further in the light
of this would be folly, and would expose us to a serious risk of having
to pay the other side's legal costs.
Our costs are in the millions and that was a serious issue for us. We
were all, both industry and professional representatives, unanimous that
we had no choice but to withdraw in these circumstances; hence the abrupt
and unexpected end of the case. We have learnt today that the OFT intends
to pursue an application for their costs. Under the legislation, costs
can be awarded for unreasonable conduct; but we do not believe that we
have acted unreasonably and our counsels agree.
The judge made it clear that the OFT would have a high hurdle to overcome
if they were to succeed in such an application. If, contrary to the advice
we have received, we were held liable to pay a sum towards the OFT costs
then all who have contributed towards us and have supported CPAG will
have to consider how that is to be achieved. The Society has been a tremendous
supporter of CPAG from the start and made a substantial contribution to
the court costs last year.
In my directorate today and in the Public Affairs Directorate we have
been inundated with calls. People have been angry, people have been upset,
people have been confused but an absolutely common theme has been the
dismay they have expressed at the loss of RPM. If we ever wanted confirmation
that it was worth the fight for the last five and a half years to try
to retain RPM that, I believe, was it.
I think the Society should be proud of the way in which it has supported
community pharmacy and the public as consumers of medicines in the last
five and a half years; and proud of the tremendous alliance we have had
with the other pharmacy bodies and the OTC industry on this issue. I want
to pay particular thanks to nine independent community pharmacy proprietors
who were prepared to give evidence to the court, and to expose their businesses
and their finances to detailed scrutiny. Three of them: Adrian Giles from
Worcester, Rakesh Panesar from Birmingham and Gillian Hawksworth, our
member of council, actually went into the witness box and faced gruelling
cross-examination. Our council reported that they were all excellent witnesses
and did pharmacy proud. For me they are absolute heroes and I think we
should thank them.
My own belief is that professional practice in community pharmacy is
going to be very much more challenging as a result of the loss of RPM.
We have no choice but to face that challenge, and I think it is going
to be an important aspect for the profession to work to make it succeed
and to ensure that we retain professionalism in the face of what has happened
in the last couple of days.
