Too early to say if loss of RPM has affected sales of
pharmacies
IT IS too early to say if the loss of resale price
maintenance has led to more independent community pharmacists offering
their businesses for sale, according to industry figures contacted by
The Journal this week.
“I do not think that the end of RPM has had much
affect on anything yet,” Robert Miller, a partner in the Henry Perlow
pharmacy sales group, said. “It has not pushed down goodwill prices.”
He added that there are still many purchasers for good, large turnover
pharmacies, particularly those making over £500,000 a year. Most of the
sales come from pharmacists seeking to retire, but some have come from
younger pharmacists wanting to move to the United States. “I expect to
see a different, more professional-looking independent sector emerging
over the next few years. With the end of RPM the pressure will be on the
Government to pay more realistic fees to pharmacy contractors. I feel
that the professional allowance should be increased to a level where it
will reimburse a pharmacist’s salary and allow more consultation areas
to be installed. This would help smaller pharmacies more than a rise in
the dispensing fee, which would benefit the larger units more.”
Tony Townsend, national business sales manager at
Orridge, says that he has not seen any significant changes in the market
since the end of RPM. However, he describes the current market as healthy
with good competition among multiples, regional groups and independents,
especially for the larger and more profitable pharmacies. “It is just
as vibrant as it has ever been. There are just as many purchasers who
want to become the younger versions of those who are retiring — which
is good for pharmacy and good for us.”
However, Steve Duncan, managing director of Moss
Pharmacy, says that the company has had more enquiries from pharmacists
considering selling their businesses. “It is too early to say whether
this will lead to more purchases. It takes three to four months to investigate
a business before agreeing a purchase.” He says that a few more marginal
pharmacies have come up for sale.
His comments are echoed by Kirit Patel, chairman
of the Day Lewis chain: “The market is surprisingly buoyant — prices are
high and expectations are high. I had expected the generics price reductions
and the end of RPM to depress goodwill prices, as these are traditionally
based on multiples of profit, but this does not seem to have worked through
yet. I am happy that there is still optimism in the market.”
The Royal Pharmaceutical Society’s registration
department has not reported any significant increase in the number of
pharmacies changing ownership over the past month.
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