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Vol 277 No 7421 p413
7 October 2006

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Outrage over Pfizer's distribution announcement

Scotland and Wales

The Scottish Pharmaceutical General Council has voiced concerns that the move leaves no fall back position if supply difficulties occur, which, it says, is especially worrying for pharmacies in remote and rural areas, many of which will find it difficult to justify another wholesaler account.

A UniChem spokeswoman said that she was as yet unable to give exact details of regional arrangements. “UniChem has extremely robust plans in place to ensure that we can maintain current service patterns for all pharmacists and dispensing doctors across the UK,” she said.

Community Pharmacy Wales chief executive officer, Peter Hayden Jones, told The Journal: “We do have concerns when any critical medicine is limited to a single supply source.” He said that CPW is working closely with the PSNC on addressing the issue, as well as talking to the Welsh Assembly Government.

Guild response

Allan Karr, chairman of the Guild of Healthcare Pharmacists procurement and distribution interest group, and pharmacy purchasing and business manager, University College London Hospitals NHS Trust, commented: “I think that the Pfizer decision to use UniChem as its sole distributor is a landmark for the pharmaceutical industry in the UK. Clearly this is an attempt by a manufacturer to control its products more closely.”

Mr Karr explained that Pfizer stands to gain the capacity and frequency benefits of a wholesaler, but with control of their stock levels and distribution. Pfizer, rather than the wholesalers, is now controlling the supply chain, he said.

“There are many strategic issues that need to be considered as a consequence. Only time will tell how this change will impact on the medicine supply chain in the long term,” he added.

Pfizer last week announced that it will sell its products in the UK with UniChem acting as sole distributor in a bid to secure the supply chain against counterfeit medicines. The move has outraged community pharmacy bodies and many doubt Pfizer's motivations.

Pfizer maintains that the current supply chain is vulnerable and that the new plans will give customers confidence that the medicines are genuine Pfizer products.

David Watson, head of trade for Pfizer, told The Journal that the new arrangement will come into effect in March next year. He described it as “a big change which hasn’t been taken lightly. We are very concerned about counterfeiting; for some reason Pfizer products seem to be targeted, which is damaging to our reputation.”

However, the Pharmaceutical Services Negotiating Committee has voiced its doubts. It said in a statement: “Although Pfizer has sought to suggest the principal driver is the discovery of counterfeit Lipitor, PSNC believes it is part of a concerted move by the company to kill parallel trade and drug diversion.”

Mark Stephenson, marketing director at UniChem, confirmed this week that the arrangements will not prevent any wholesaler — including UniChem — from importing Pfizer products through parallel trade. “It is a free market,” he said.

The National Pharmacy Association said: “The recent decision by Pfizer to use one wholesaler only to act as a distributor for its products is another example of significant changes in trading terms which could cause huge upheaval and uncertainty for community pharmacists (not to mention the possible adverse effect this move could have on timely patient access to Pfizer products)”.

Steve Dunn, group managing director of AAH Pharmaceuticals, launched a strong response: “This is a bad deal for pharmacy,” he said. “We support the PSNC and the NPA in their opposition to this deal.” He told The Journal that the arrangement would eradicate choice and competition, be a disruption to the usual supply chain and create multiple invoices and deliveries for pharmacists.

Mr Watson said that he was surprised by the AAH response, since Pfizer was in detailed planning with AAH (as well as UniChem and Phoenix) for the better part of last year, but did not come to an agreement with them.

Martin Sawer, executive director, British Association of Pharmaceutical Wholesalers, said that Pfizer is wrong to link counterfeit medicines to pharmaceutical wholesaler distribution. He said: “It is a slur on wholesalers who work closely with suppliers especially when new products need to get to market fast or when product recalls are necessary because of manufacturer error.”

Naturally, independent pharmacy groups are worried (see Meetings p425). Cambrian Alliance made a statement this week, saying that its members are concerned that having UniChem as the sole supplier of Pfizer products will give Alliance Boots pharmacies an unfair advantage in the allocation of short supply products, a monopoly that would enable them to dictate levels of discount and service.

Pfizer confirmed that it has independently audited Unichem’s capacity to deliver to every pharmacy in the UK twice a day and that there would be no minimum order quantities.

Community pharmacists are anxious that Pfizer’s plans will affect their bottom line (see Letters p423).

Pfizer will be announcing a new discount scheme in around three weeks’ time, Mr Watson said.

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