..Information to Pharmacists
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Your Monthly E-Magazine
FEBRUARY, 2004

JAMES ELLERSON

A Marketing Consultant Perspective
Perils and Parallels-NCP, Liquor and Pharmacy Legislation

In 1995, the states of Australia signed up to a National Competition Policy (NCP) which required each of the states to review all anti-competitive laws.
Financial incentives were offered for this to occur, and in the case of NSW, an amount of $254.4 million was to be paid last month.
Instead it received $203.5 million, a shortfall of $50.9 million.
The $50.9 million shortfall was a fine for not reforming liquor licencing laws and other legislation involving activities such as pharmacy.

In many ways, the liquor licencing laws have a parallel in pharmacy, and this is possibly due to the fact that liquor is regarded by many as an actual drug.
For example, there is a "needs test" in existing legislation to determine whether a neighborhood requires additional liquor outlets.
This equates to pharmacy licencing i.e. the requirement for approval numbers.
Storage of liquor requires separate premises, and this is also a pharmacy requirement (you can see how Woolworths evolved their pharmacy concept).

There is a set of regulations relating to the sale of liquor, and while not quite as onerous as the Poisons Schedules in pharmacy, there is a direct parallel.
For example, one of the NSW concerns is that with a deregulated liquor environment, sales to children would increase.
Similar concerns exist separately for pharmacy in the deregulation of certain medications e.g. ibuprofen, where in an open environment, consumers would not have sufficient protection from the side effects of these drugs, because of lack of informed supervision and the inadequate provision of information.

National Competition Policy does not require governments to repeal all restrictions on competition, or to deregulate or privatise industries. However, it does require governments to undertake rigorous reviews of legislation that restrict competition, and to reform those competitive restrictions, except where it would be against the public interest to do so.

Given that the Wilkinson Report found that pharmacist only ownership of pharmacies was in the public interest, ownership provisions are likely to remain intact in the various state Pharmacy Acts.

In doing some research for this article it struck me that the sale of liquor represented such a parallel to pharmacy that it opened up a "whipping post" that could be used against organisations such as Woolworths.
Woolworths have been known to plan adverse PR campaigns against pharmacy, through sending "mystery shoppers" into pharmacy environments.
This only to highlight weaknesses in pharmacy arguments for the restricted sale of medications in a pharmacy-only environment.
The PGA might consider a similar foray into Woolworths liquor stores to measure how they are monitoring sales to minors, to people already intoxicated, or where there is an exacerbation of the social problems of entire communities, particularly some rural communities.

It is interesting that some of the NCP licencing law requirements include setting the legal age for consumption; liquor retailers having a working knowledge of relevant legislation; action to stop the sale of alcohol to intoxicated persons; a "public interest" test for licences that focuses the social, community and health implications.

The parallels with pharmacy requirements are compelling.

We are often confronted through TV current affairs programs with the problems of teenage "binge" drinking, which may coincide with "Schoolies Week" on the Gold Coast, but more often it is the local park with local kids as a regular event. Which outlets supply supply the liquor, and why is it not adequately policed?
These are arguments that can be developed against major retailers encroaching on pharmacy, and the Pharmacy Guild of Australia (PGA) might like to develop a PR campaign around these images i.e. it happened with liquor, now it will happen with down-scheduled OTC medicines.
This is an activity the PGA is very good at.

On first examination, NCP looks as though it is the blunt instrument bludgeoning the states to come under the control of the Federal Government economic policies, and to a certain extent this is true.
It is certainly an attack on state independence.
What is obvious is that NCP provides greater opportunities for retailers like Woolworths to increase their force and influence, and pharmacy is a target under the guise of NCP.

While face-saving processes emerge in the tussle between state and federal governments, the "soft" options will be offered for sacrifice first.
Pharmacy is fortunate to have a strong and respected lobby group in the form of the PGA.

Pharmacy presents a reasonably united front, but never unanimous.
This is both a strength and a weakness and PGA members should be looking to their umbrella organisation to present coherent strategies and strong leadership.
The reward for PGA leaders will then be a unanimous vote of confidence.