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State of the Pharmacy Industry

Written by Kristy Hickey . March 24, 2017
4 min read

As a business owner you probably have some goals you want to reach for your business. Do you know what strategies to put in place to get there or have a trusted adviser guiding you?

I recently attended the annual Australian Pharmacy Professional Conference & Trade Exhibition (APP) on the Gold Coast with a couple of colleagues and also a couple of pharmacy owners.

This conference is run by the Pharmacy Guild of Australia (The Guild) and is designed to give pharmacy owners an update on where the industry is up to, where they think the industry is heading and also how pharmacies can improve their performance.

The first session had different leaders from the industry including The Guild, pharmaceutical wholesalers and the newly appointed Federal Minister for Health & Education, sharing their views of the industry.

While each said the pharmacy industry was getting tougher, in particular due to Price Disclosure reductions, each person spoke, unsurprisingly, with their own particular agenda in mind:

  • George Tambassis, the National President of The Guild said they were doing everything they can to secure immediate government funding and medium term security of pharmacies in terms of the upcoming new Community Pharmacy Agreement;
  • Mark Hooper, the CEO of Sigma Pharmaceuticals said they needed a better deal from the government in terms of distributing Pharmaceutical Benefits Scheme medicines;
  • Greg Hunt, the newly appointed Federal Minister for Health and Education, said the government was committed to working with the industry, with his immediate concern being the release of $600m intended to go toward health programs that pharmacists could supply (though he didn’t mention this money was supposed to be released a couple of years ago).

One interesting thing all speakers brought up was the effect biosimilar medicines will have on the industry. Biosimilar medicines are a type of biological product that is licenced by the FDA due to its clinical similarity to an already FDA-approved biological product. While these biosimilar medicines won’t be introduced in Australia for approximately 12-18 months, due to the lower cost of manufacturing these medicines it is projected they will shake up the industry. So it will be very interesting to see how these new products shape the market in the not too distant future.

Later that day there were some presenters talking about the future in general and then relating it (or at least trying) to the pharmacy industry. The major points I took out of these presentations (which can be applied to other industries, not just pharmacy) were:

  • The world is constantly changing and if you don’t change with it, then you will get left behind;
  • Innovation needs to be considered in all aspects of your business. All industries are getting tougher because the need for something new is constantly required and an increase in efficiency is always desired and nearly always required;
  • Linking the two points above is technology and automation. Technology is constantly changing the world and innovation can be helped with automation. Adopting new technology and automation may very well help your business in terms of efficiency and quality of product or service.

In terms of the suggestions for improving the performance of pharmacies, these suggestions seemed to be lacking in quality and numbers.

The Guild along with the government are heavily pushing professional services as an additional source of revenue for pharmacists and they were quick to point out the number of professional services a pharmacist could offer. Unfortunately they weren’t so quick in pointing out how pharmacists could make the majority of these professional services financially viable.

There was also the mention of a reporting tool that would help pharmacists examine in more detail the performance of their pharmacy. Of course this reporting tool came at a cost and having a look at it, I felt it was much less detailed than the reporting we currently give to our pharmacy clients.

The suggestions of ways of improving a pharmacy was summed up in one of the final suggestions mentioned in the seminar. ‘For those pharmacists struggling somewhat, they should go to their landlord, tell them the pharmacy industry is very tough at the moment, and to ask for a reduction in their rent’. I’m not so sure many landlords would respond positively to this request…..

All in all the APP was a good conference however if you attend in the future I would give the following advice:

  • You need to read between the lines of what is said;
  • There is a lot of politics in what is being said;
  • There is a lot that is not said; and
  • The Gold Coast is a pretty good place to attend a conference!

Pharmacies require specialised accounting services and BLG Business Advisers have years of experience providing effective solutions to our many pharmacy clients. To discuss your situation or find out more, get in touch with BLG online or call (02) 4229 2211 today.

Written by Kristy Hickey . March 24, 2017
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