The Pharmaceutical Journal
Vol 270 No 7242 p431
29 March 2003

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OFT loses first two sets but the match is most likely to end in a tie-break

This week, both Scotland and Wales rejected the Office of Fair Trading's report on control of entry. England looks likely to reject complete deregulation but some reform is still on the cards, reports Clare Bellingham (on the staff of The Journal)

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Pharmacists were offered a ray of hope this week.

First the Government hinted in a parliamentary question time that it was going to reject the Office of Fair Trading recommendation on deregulation of community pharmacies. Then on March 26, the Scottish Executive and the Welsh Assembly came out with announcements saying that they are doing exactly that. This was quickly followed on the same day by a statement from the Department of Trade and Industry in England stating that it will publish a response to the OFT report by the end of the summer that will take into account wider policy objectives.

Suddenly, the sense of impending doom in pharmacy has been blown away in a whirlwind of activity. However, it is important to remember that although it is now almost certain that the OFT recommendation will not be implemented in full, some reform of the regulations is likely. And this is why John D'Arcy, chief executive of the National Pharmaceutical Association, is urging pharmacists to continue lobbying members of Parliament until a final decision is reached.

Westminster debate

The clues as to what will be in the Government's response to the OFT report came in a parliamentary Trade and Industry (the department co-ordinating the Government's response) questions session on 20 March. Patricia Hewitt, the Secretary of State for Trade and Industry, indicated that a compromise package is being devised.

Pharmacists opposing the OFT report have lobbied hard, and have gained support from the general public. The success of this lobbying was demonstrated by the fact that several MPs reported that they had received a substantial number of letters arguing against the OFT proposal. One such MP, Andrew Dismore (Lab, Hendon), asked the first question relating to the OFT report. He said: "I have received objections from hundreds of constituents who are outraged by the OFT proposal. They vigorously protest that their local pharmacies are convenient, that they know and trust the pharmacist, that they often have no transport to go elsewhere and that they are not pushed into buying unnecessary products."

In response, Ms Hewitt said that she welcomed the OFT report, but commented: "I am also clear that there are limits to markets, particularly in the delivery of health services. It is essential that pharmacists should be able to fulfil not only their present valued and trusted role but the wider role envisaged for them in the NHS plan: simply deregulating the market will not do this."

Ms Hewitt explained: "It is not part of the OFT's remit to look at the much wider health service objectives or the role that community pharmacists can play in supporting modernisation and improvements in the NHS. That is our job in Government and we will come forward with a balanced package that will achieve those health can community aims."

Pharmacists have argued that the OFT report does not recognise the importance of pharmacy's role within the NHS plan. Ms Hewitt agreed: "Although competition can clearly bring benefits to consumers, the crucial issue is that pharmacists should be able to enhance their role within the NHS plan and meet the health care needs of all our constituents, particularly those living in poorer and rural areas."

Ms Hewitt promised that the Government would draw up a balanced package of measures. "Let me stress that decisions will not be made by the OFT because its role in these matters is advisory. The Government will make the decisions in the full context of the NHS plan and equivalent developments in the devolved administrations," she added.

Report promised by summer

Ms Hewitt's comments were followed by a Government announcement on March 26 that it will respond to the OFT report before the summer recess. A progress report will be published by the end of June.

The Government says that it needs to take into account wider policy objectives. However, it adds that it strongly supports the OFT objectives of reducing prices, improving quality of services and delivering better access.

Alan Milburn, Secretary of State for Health, said: "We want to improve access and choice — including improving out-of-hours access for NHS patients — so that more NHS patients can use the skills of community pharmacists, who are trained clinicians, for advice, information and services. The OFT report also noted that in a more competitive environment problems could arise through the possible effect of deregulation on the ability of patients in some areas to access high quality pharmacy services. We therefore propose to examine these issues further before reaching a final decision on a balanced package which most effectively promotes competition, new entry and increased choice alongside our wider social and health objectives."

And in a comment indicating that some reform of the regulations is likely, Ms Hewitt added: "We favour change to open up the market and improve quality and access without diminishing the crucial role that pharmacies play, especially in poorer and rural areas."

Welcome response

The pharmacy world has responded positively to the news.

Sue Sharpe, chief executive of the Pharmaceutical Services Negotiating Committee, said: "We welcome the Government's initial response to the OFT report and its view that any final decision must balance improved quality and access without diminishing the crucial role that pharmacies play. We also welcome Alan Milburn's comments on improving access and choice for patients by using the skills of community pharmacists. This is an encouraging sign for the future of local pharmacies."

Mrs Sharpe added that the PSNC looks forward to continuing to work with the Government and representatives of primary care trusts to ensure that a balance is made between access, choice and competition.

Bad news for the OFT?

Are the scales tipping against the OFT? With the devolved administrations firm rejection of the report, and the healthy scepticism in the Westminster Parliament, it certainly seems that the OFT has lost at least the first two sets. But the match is far from over.

Exactly what Westminster's "balanced package of reform" will contain is not yet known. Partial loss of entry is a strong possibility. So pharmacists arguing against the OFT report should not claim victory. It is likely that that the reforms will be worked into the Government-PSNC negotiations over pharmacy's new contract.

Most people accept that some reform of control of entry is needed. If pharmacists want to influence the type of reform, they need to keep lobbying the Government.

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