Brian Ó Domhnaill (Fianna Fail)

I acknowledge the contribution made by pharmacists around the country. I come from a rural area in Donegal and I recognise the wonderful contribution of rural pharmacies in helping vulnerable members of our society, including the young and the elderly.

The HSE announced new arrangements for wholesale margins on 17 September last year, which affect the price for the supply of drugs to the State. This followed the completion of new arrangements with drug manufacturers in 2006 and the IPHA-APMI agreements. This, as the Minister mentioned, is distinct from the dispensing fees paid to community pharmacists under the general medical scheme and the drug payment scheme, which remain unaffected by these arrangements. It was planned that the new wholesale price arrangements for the delivery of drugs to pharmacies would take effect from 1 January 2008 but, as we know, the date was deferred to 1 March by the HSE in light of the ongoing engagement with the IPU under the auspices of Mr. Bill Shipsey SC.

The Government is firm in its view that the wholesale mark-up paid on the price of drugs should be reduced to a level that is fair to both taxpayers and wholesalers. The existing mark-up is between 15% and 17.6%, while the revised mark-up, as we know, is 8% from 1 March this year and will be reduced to 7% from January 2009. In light of the concerns expressed about the alleged impact of the new wholesale arrangements on GMS-dependent pharmacies in particular, a draft interim contract with a flat-rate dispensing fee of not less than €5 has been offered to individual community pharmacists. This offer is voluntary and pharmacists can opt to stay with their existing contracts if they so wish. Pharmacists with a high proportion of medical card patients currently receive a dispensing fee of €3.26 for most transactions. Many of these pharmacies are in rural or inner-city areas and provide an important social and health service. The higher flat rate is aimed at these pharmacies in particular.

The Minister, contrary to a suggestion made by a Senator from the Opposition, did meet with the IPU recently — I understand from the Minister it was about two weeks ago — and heard its point that there should be an independent assessment of the fees offered. I welcome the fact that the Minister has established an independent body which will immediately begin work to assess a fair interim community pharmacy dispensing fee of at least €5 to be paid for the GMS, the DPS and other community drug schemes. However, €5 is a little on the low side. I ask the Minister to use her good offices to impress upon this body to consider increasing the €5 fee. I note that it is a minimum dispensing fee but I urge that it be increased.

The independent body is chaired by Seán Dorgan, the former head of IDA Ireland. I have full confidence that Mr. Dorgan, who is a man of great reputation, will bring forward proposals that can be agreed upon by both the HSE and the IPU. Submissions from all stakeholders will be accepted and analysis of those submissions will be carried out by the three-member body. Recommendations are to be made to Government by the end of May and the recommended fee, subject to Government approval, will be backdated to 1 March 2008 or to whatever date individual community pharmacists choose to accept the HSE's voluntary interim contract. The independent body and independent negotiations represent the best available option for addressing the concerns of pharmacies. I have confidence that there will be meaningful discussions and a meaningful outcome. We all anxiously await this.

The body met first on 25 February and again yesterday. Public submissions have been invited and the development of a new substantive pharmacy contract will get under way as soon as possible. This will be done under the auspices of an agreed facilitator and it too will be priced by the independent body. Thus, we have the independent negotiations which we all sought, certainly on this side of the House, and we all welcome them.

I commend the IPU on the manner in which it dealt with this over the weekend. On Thursday evening the president of the IPU, Michael Guckian, called on all pharmacies to continue dispensing medicines to patients on 1 March.