Whether it’s news of more pharmacy closures or further delays to contract reviews, you don’t have to look far to see it is a challenging time for pharmacies. A review of the pharmacy market for 2023 revealed that “operators continue to face significant operational challenges with little respite or ability to offset costs within the current contractual funding framework.” With no sign of change in the short term, it’s easy to see that it’s a difficult time for pharmacies to continue turning a profit.
Previously, we have focused on how using technology to work smarter and save time can ensure that your pharmacy team is working efficiently and able to maximise revenue opportunities from service income to remain profitable. However, with the challenge of drug shortages not only impacting supply but also resulting in significant price rises, ensuring you can buy at the best value is more imperative now than ever before.
Finding the best prices for drugs may already be a priority for you, because if you aren’t, there’s a risk that you are paying more for drugs than you are being reimbursed. Sometimes it may look like pennies for a product, but when you are ordering hundreds of these, it’s certainly worth ensuring you are getting the best value you can. And if you are currently relying on doing this manually, it’s time to consider an alternative to help you save time and make money.
Prescription Item Data
The BSA recently published its Prescription Cost Analysis for England 2023/24. This tells us that the number of prescription items dispensed in the community was 1.21 billion, a 3% increase from 1.18 billion in 2022/23. It also covered other key facts around dispensed items, and we decided to delve deeper into these figures using our price cascade and preference ordering solution, OrderManager, to understand the challenges pharmacies face in purchasing these items:
Looking at Atorvastatin tabs 40mg, with a Drug Tariff Price of £1.41, the purchasing price from various suppliers in our data (2nd July 2024) ranged from 44p to £1.24—that’s a difference ranging from 17p to 97p profit per pack. With a popular product like this, pennies really do make pounds. Ensuring you get the best price using a comparison tool could be the difference between turning a profit in your pharmacy and not.
Beclometasone is an example of slim margins for pharmacy, based on the data we looked at for the 200MCG inhaler within OrderManager, profit could range between 0 and 31p. With products like this offering such slim margins, ensuring you are buying smart and always maximising profit is really important. Some suppliers are charging more than the tariff price, so it’s important you stay on top of these costs so that you don’t make a loss.
With a tariff price of £36.59, we still see very slim margins from a range of suppliers, but by using OrderManager, we can see the difference; using PI switching could give your pharmacy a 38p profit rather than zero. With prices potentially fluctuating across suppliers, the cheapest provider may be changing regularly, so by easily importing prices for immediate use, OrderManager can quickly order the cheapest without having to manually track.
If you aren’t already using a price comparison tool in your pharmacy, now is the time to think about implementing one. If you are still manually trying to find the best prices for the drugs, why waste so much time when technology can do this all for you, allowing your time to be better spent servicing patients?
OrderManager
Price cascade and preference ordering are centrally managed within OrderManager so that you can simply specify ordering rules that can be customised to your exact needs, whether you are a single-site pharmacy or part of a group. With OrderManager, you remain in total control, unlike alternative wholesaler-backed cascades. Huge savings can be made with simple rules and supplier price files. The cheapest generics and PI switching come as standard. Whole orders for hundreds of items can be placed in seconds, and replies return to the PMR rapidly, so you know what is coming and from where. OrderManager really offers a quick and easy way to increase your profitability—can you afford not to?