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June 2002 issue Pharmacy Today magazine


The government has backed down on its planned deregulation of pharmacy ownership.

Pharmaceutical Society president Bernie McKone hails the turnaround as a "great day for pharmacy."

Pharmacy Guild president Gray Maingay says the "persuasiveness and logic" of the guild and society's arguments, together with growing public backing for pharmacy, finally shone through.

"It's a good, safe, sound decision for everybody - for pharmacy and the public," he says.

Guild chief executive Murray Burns views it as the "culmination of the efforts of the entire guild family."

Cabinet has agreed to retain pharmacist control of pharmacies, with at least 51% of share capital of a pharmacy staying in the hands of a pharmacist, and multiple ownership of up to five pharmacies.

It has yet to be revealed whether Medsafe or the yet-to-be established Pharmacy Authority will manage the licensing system.

A provision will allow the Minister of Health to permit non-pharmacist ownership, for instance Primary Health Organisations.

Under cover

The Health Minister was in Australia at the time of the announcement.

Her press secretary John Harvey says apart from acknowledging "constructive" dialogue with the society and guild and pharmacy embracing the Primary Health Strategy, the minister "has nothing more to say."

National's health spokesman Roger Sowry is describing the government's change of heart as folding to political pressure.

"She (Annette King) release the policy in the low media coverage time between Christmas and New Year & now she's hiding behind the budget in backing down."

The new order

The main points are:

  • Owners must be New Zealand registered pharmacists holding a current practicing certificate.
  • Ownership will be regulated through an annual licensing regime.
  • A pharmacist owner must own at least 51% of shares.
  • Multiple ownership of up to five pharmacies.
  • There will be no limit on the number of minority shareholdings as long as effective control lies with the licensed owner.
  • The Minister of Health will have the discretion to make exemptions for a non-pharmacist to own and operate a pharmacy.

The changes are currently being written into the Health Practitioners Competency Assurance Bill, expected to enter Parliament later in the year.


Whether Medsafe or the Pharmacy Authority manages the licensing regime is not clear.

Society chief executive Dr Joan Baas says pharmacist-only ownership means the future Pharmacy Authority would be the logical candidate.

The provision for the minister to allow non-pharmacists, such as PHOs and community trusts, is also a grey area, says Bernie McKone.

The aim is to provide services for rural and isolated areas, he says.

"But we need to be careful that it doesn't marginalise pharmacies already operating (in these areas."

Unichem has been urging 51% pharmacist ownership and multiple ownership of up to six pharmacies for two years.

Chief executive and society councillor Tim Roper welcomes the government's decision.

Pharmalliance, the holding company for Unichem and Dispensary First, is interested in the possibility of taking part in the minority shareholding possibilities, he says, but requires greater detail of system.

He suspects non-pharmacist investors will look twice at investing large amounts in pharmacies if they have no control over the company.

Ways around this could be shareholder or franchise agreements, he says.

However, the guild, in a letter to members said the ownership arrangement was one issue that needs further consideration.

Asked to expand, Murray Burns said pharmacy needs to ensure minority shareholders were not in a position to "pull the strings".

Meanwhile, the guild's ownership campaign has wound down.

Anti-deregulation petitions are being sent returned to the guild and pharmacists asked to stop distributing patient brochures.

The guild is looking at refunding money levied to finance the Blue Banner Campaign.

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