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Medicines optimisation schemes simply rob Peter to pay Paul – GPs should boycott them

Medicines optimisation schemes are dragging prescribing ethics into the gutter and GPs should play no part in them, says Dr Patrick James McNally

Under our CCG’s ‘Medicine Optimisation Benefit Share Scheme’, practices are being asked to deliver prescribing cost savings. If we sign up, there’s a small pot of cash to start the process. Then, if we deliver sufficient savings, the CCG keeps half, and the other half comes directly to the practice. Undoubtedly an attractive proposition.1

But – where does this money come from? A big chunk of the savings is to be made, somewhat counterintuitively, by switching our patients from generic to branded prescribing. Take the CCG’s example: ‘Co-codamol Tabs 30/500mg to Zapain 30/500mg’. Zapain undercuts the generic price by a whole £0.40 per 100 tablets; it turns out whenever we prescribe Co-codamol, our pharmacy colleagues have been dispensing Zapain, billing for Co-codamol, and pocketing the difference – the cheeky rascals! By prescribing Zapain, they can only bill for Zapain, and the CCG gets to keep the £0.40. At scale, this might save £1,000 per practice, or more.

Sounds ideal – until you appreciate that the Byzantine funding structures of community pharmacies are even more perverse than those for general practice. Just as we have Carr-Hill, Global Sum, QoF and any number of LES/DES/LISs, they have Advanced Services, Quality Payments, Drug Tariff and the ‘Retained Margin’. That £0.40 is the ‘element of purchase profit’ allowed for in pharmacies’ contracts with the Department of Health (DH), and at scale, it makes up more than a quarter of their total funding.2

How would the average practice cope, if CCGs asked pharmacists to sabotage QoF, and offered them 50% of the savings?

Prescribing by brand to undercut the generic price is a case of ‘robbing Peter to pay Paul’ – funds that the DH intended for pharmacies, being retained within the CCG budget. GPs should play no part in this.

Where branded medication undercuts the generic or tariff price, the solution is for the tariff to adjust, or for pharmacies to be reimbursed according to their actual costs. Asking doctors to prescribe the brand is failing to understand the problem. Incentivising them to do so is perpetuating it.

A metaphor might be helpful here. Consider the guttering in my terraced street. The lowest point in the guttering is at my point in the terrace, so when it overflows, it pours all over my back garden. Using CCG medicines optimisation logic, the solution would be to hitch my side up, so that next time it rains, the water dumps all over the neighbour’s side of the fence, not mine.

But what I actually do is borrow a ladder from my neighbour from time to time. Between us, we empty out the blocked leaves so the guttering can keep draining.

My prescribing software asks me to justify myself, when I decline a cost-saving generic-to-trade switch. Unfortunately, the following doesn’t quite fit in the box:

‘Dear CCG medicines optimisation team,

‘Prescribing by brand for non-clinical reasons is harmful to patients and to the NHS. It distorts the normal functioning of the NHS drug tariff and the ability of pharmacies to source the appropriate medication. Where the specified brand is not readily available, branded prescribing is likely to inconvenience the patient and/or introduce a clinical delay to treatment.

‘Furthermore, generic pricing in tariff part VIIIa (particularly for those drugs under scheme M) is structured to ensure sustainable funding for community pharmacies, eg, by delivering the “retained margin”. This is negotiated and agreed by the Pharmaceutical Services Negotiating Committee and the Department of Health.3 CCGs and GPs should not attempt to undermine this.

‘Prescribing by brand to undercut the generic price is a case of “robbing Peter to pay Paul”: attempting to retain funds intended for pharmacies within the CCG budget. I appreciate that your intentions are noble, but the end result is harmful to patients, to pharmacies, and to general practice. Yes, general practice deserves a bigger slice of the pie, but not by sizing up our pharmacy colleagues’ slice, then stealing it from them.

‘I will of course continue to prescribe by brand where good clinical reasons exist.

‘Yours, Dr PJ MCNALLY.’

So next time SwitchRx, OptimizeScript or the CCG asks me to alter a prescription, I might just have to politely decline. Our prescribing ethics during this piece of ‘medicines optimisation’ have been dragged into the gutter; fortunately, they don’t have to stay there.

As usual, Oscar Wilde puts it best: ‘We are all in the gutter, but some of us are looking at the stars.’4


1. There is, as always, relevant guidance. NICE National Guideline NG5 – Medicines optimisation: the safe and effective use of medicines to enable the best possible outcomes. This advocates person centred care, self-management plans, patient decision aids, regular review, and clinical decision support – all great ideas – but is strangely silent about what to do when someone is offering you £0.75 per registered patient to tinker with their medicines.

2. NHS Drug Tariff September 2017. Runs to 962 pages as of September 2017. A wonderful document, mainly because the Rt Hon Jeremy Hunt MP has to read it every month and keep it updated, as one of his many duties as Secretary of State for Health.

3. Pharmaceutical Services Negotiating Committee: Category M drugs. ‘Category M prices are set to include an element of purchase profit, a fundamental part of the funding arrangements.’ Total funding (for community pharmacies) negotiated for the 2014/15 financial year was £2.8 billion. Of this, £800m was to be delivered as retained buying margin.

4. Wilde, O. Lady Windermere’s Fan, A Play About a Good Woman. 1892

Dr Patrick James McNally is a GPST3 in north-west London


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Readers' comments (5)

  • Son is a pharmacist and tried to explain this to me. Was flabbergasted. Good on you for writing about this bizarre cost cutting tactic.

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  • Too often we are pitted against the pharmacists - the flu jab debacle being a classic example.

    But they are doing other things to make money too - like the minor illness scheme where they can claim a consulting fee for every bottle of calpol they sell, where the parents would never have consulted a GP or pharmacists anyway.

    Good for them, I say.

    And the branded generic which is cheapest this week, is going to be different next week. Far better to stick to prescribing the generics and let the pharmacies take their cut.

    I like the analogy about borrowing the neighbours ladder.

    Now, how to sort out the issue of having to code the flu jabs given elsewhere for zero income to us..?

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  • Thank you.
    Yes, ideally I see us and pharmacists co-existing, each doing our own thing.
    We prescribe, they dispense, for example. And these are obviously linked, yet distinct. We can work together, for example when I prescribe something they can't dispense for whatever reason, then I need to know about it. But it's not my role to interfere with the dispensing!
    Consulting fees and the minor illness scheme are fascinating, when looked at from the all-you-can-eat buffet that is General Practice. Maybe a subject for another time!

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  • I think some of the larger pharmacy companies may allegedly be based off shore to minimise tax liability. I have no concern about the NHS picking their pockets. I do have sympathy for independent pharmacies trying to swim against the tide. What about the pharmacies requesting prescriptions that are not needed for patients? Do the pharmacies do anything about that?

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  • AlanAlmond

    Very interesting article, thank you.
    ...and further to the last comment, yes indeed, what about pharmacies issuing medication that has not been requested by the patient simply because it’s on their repeat list? Seems to be almost routine round my way and must be costing the NHS an absolute fortune in lactulose and diprobase the patient didn’t want but which was delivered anyway and ends up stacked in their cupboard or thrown away.

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