How has the announcement of 8CPA affected Pharmacy Sales?

It's a good time to buy AND a good time to sell!

What does the Guild’s 8CPA and the PSA’s ‘Strategic Agreement’. mean to the value of Pharmacies?

Firstly. I think it should be said that after a few false steps early on, the Pharmacy Guild, with a great deal of membership support, have done their job very well, achieving stability and a reasonable level of remuneration over the next 5 years.

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It’s worth noting that this is against the position we were in a month ago, but against the position prior to 60DD, we are, in Government remuneration terms, not better off.

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Bruce Annabel calculates that Pharmacies are better off until the threshold of 40% uptake of 60DD is reached. Happily, however, the disruption has forced Pharmacy to look more closely at what we do and the adjustments we made to pricing and service charges should shore up this shortfall.

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The big win, however, is the PSA’s ‘Strategic Agreement’. I do need to disclose my bias here being the NSW PSA Branch Committee President, but the potential to build paid services outside the 8CPA, which is, after all, predominantly an agreement about medication funding, is a huge win and one that the National PSA leadership should be proud of. This agreement takes funding for items such as NIPVIP, HMR/RMMRs and Workplace funding outside of the capped 8CPA funds.

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8CPA has provided the stable platform needed for banks to have confidence in the Pharmacy sector and to lend at Capitalisation Rates at or very close to those prior to the 60 Day Dispensing Announcement, supporting sale prices at a level very close to prices up until March 2023.

So, is it a good time to buy and/or a good time to sell?

Well, it's probably yes to both.

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For sellers, the stability of the next 5 years means that prices will be solid.

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For buyers, the same applies with the extra bonus of the potential of the outside 8CPA funding. In NSW the Pharmacy trials are showing the way with the recently launched skin conditions trials, Impetigo, Shingles, Dermatitis and Psoriasis being added to the Oral Contraceptive trial and UTI Treatment moving to Business as Usual. The NSW Government has committed to rolling out the same 23 conditions of the QLD pilot. That along with a hopefully positive outcome from the Scope of Practice Review means that the Pharmacy profession has much to look forward to.