Brendan Smith (Cavan-Monaghan, Fianna Fail)

I am responding on behalf of the Minister for Health and Children, Deputy Harney. I emphasise that 1 March next is not the deadline for the imposition of a new contract for pharmacists — it is the date for the introduction of the new wholesaler pricing arrangements. The Government believes the wholesale mark-up paid on the price of drugs should be reduced to a level that is fair to taxpayers and wholesalers. The existing mark-up of between 15% and 17.6% is neither reasonable nor sustainable. The HSE will proceed with its plan to pay an 8% mark-up from 1 March next and a 7% mark-up from 1 January 2009. The Minister is keen to support pharmacies which have a high proportion of medical card patients and to which a dispensing fee of €3.27 applies for most transactions. As many such pharmacies are in rural or inner city areas, they provide an important social and health service. With the support of the Minister, the HSE has indicated that it is prepared to offer a higher fee of at least €5 per item dispensed to community pharmacists, on the basis of an interim contract which would be essentially the same as the existing contract. The interim contract is being offered on a voluntary basis — community pharmacists can opt to remain on their existing contract if they wish.

When the Minister met representatives of the Irish Pharmaceutical Union last week, she was advised that an independent assessment of the fees offered should be undertaken. In an effort to resolve this situation, the Minister announced that she is establishing an independent body to begin work immediately on assessing an interim, fair community pharmacy dispensing fee of at least €5 to be paid in respect of the medical card scheme, the drug payment scheme and the other community drug schemes covered by the present pharmacy contract. This body will be chaired by Sean Dorgan, former head of IDA Ireland. It will take submissions from all sides and will carry out its own analysis. It will be asked to make its recommendations by the end of May 2008 and its recommended fee level, subject to Government approval, will be backdated to 1 March 2008.

The requested date for submission of the report is 31 May 2008. The development of the substantive new contract will get under way immediately and will be completed as soon as possible. This will be done under the auspices of an agreed facilitator and it will be priced by the independent body. The HSE, as the contracting body, and the IPU, as the representative organisation for community pharmacists, with other stakeholders will be entitled to make submissions to the independent body on issues of concern to them. The Minister believes this will provide all concerned with a reasonable way to make the transition to a fair and transparent method of payment for present services and a greatly developed pharmacy service in the near future.

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