Medicines and Medical Devices Bill

Baroness Wheeler Excerpts

Committee stage & Committee: 3rd sitting (Hansard) & Committee: 3rd sitting (Hansard): House of Lords
Wednesday 28th October 2020 Grand Committee

Moved by

[Baroness Wheeler]

23: Clause 2, page 2, line 8, leave out paragraph (c)
Member’s explanatory statement
This is a probing amendment that would omit the Secretary of State’s power to make changes to wholesale dealing, including hub and spoke models.

[Baroness Wheeler (Lab)]

My Lords, I am pleased to move Amendment 23, in the name of my noble friend Lady Thornton, and to support Amendment 29, in the name of the noble Lord, Lord Clement-Jones.

Our amendment is a probing amendment, which has two aims. First, it provides us with the opportunity to hear from the Minister why the Government consider that the extensive delegated powers on the hub and spoke model for pharmacies are needed at this present time under the Bill, rather than ensuring that any such proposals are instead contained in future planned and well-thought-out primary legislation—properly consulted on and worked through—that amends existing legislation and regulations.

Secondly, we understand that there has been some discussion with key stakeholders in the pharmacy industry since the Government’s intentions were revealed in the nine short paragraphs on dispensing medicines in the impact assessment for the Bill—as we know, hub and spoke dispensing centres are not referred to on the face of the Bill. Today is an opportunity for the Minister to update us on the Government’s response to the concerns and issues raised by MPs in the Commons and by noble Lords during the Bill’s Second Reading, and in representations from leading industry organisations, including the National Pharmacy Association and the Pharmaceutical Services Negotiating Committee.

We need far greater clarity on what exactly is proposed, how the Government intend to take all this forward and how the very limited proposals that we have heard so far fit into the NHS long-term plan vision for the transformation of community pharmacy as an integral part of local primary care. How will pharmacists’ enhanced role in the future limit the number of people who will not have to see their GPs, in the way that the Government envisage?

Amendment 23 would amend Clause 2, on the “Manufacture, marketing and supply” of human medicines, and would delete the Secretary of State’s power to make provision for the distribution of human medicines by wholesale dealing, as is proposed for hub and spoke dispensing in the delegated powers proposed in the Bill. I have deep concern about the extensive range of delegated powers proposed under the Bill, and I support the decisive views of both the Delegated Powers Committee and the Constitution Committee on this matter, which have been made crystal clear by my noble friend Lady Thornton at all stages of the Bill. Major changes such as those envisaged for the community pharmacy sector through the extension of hub and spoke dispensing should be on the face of the Bill, with appropriate safeguards on their development, including a full public consultation.

The impact assessment tells us that

“dispensing needs to become more efficient to free up pharmacists’ time for other activities”

and that this will be achieved if all pharmacies have access to more efficient hub and spoke dispensing. We strongly support the aim of freeing up pharmacists’ time, better use of the skill mix in pharmacies, extending prescribing duties for pharmacists and a greater role in clinical service delivery. We also fully acknowledge the work, expertise and development of the hub and spoke models, including automated prescription assembly facilities—PAS facilities—operated by the large pharmacists, such as Lloyds Pharmacy, within their community retail pharmacy operations.

The impact assessment acknowledges the scale, substantial up-front and running costs and slow timetables of setting up and then operating hub and spokes efficiently and effectively, which are in reality way beyond local groups of pharmacies not part of nationwide businesses to fund and operate. In a moment of understated frankness, the IA admits:

“The costs and benefits remain uncertain, as do some details around the policy design, and the changes would be provided for by regulations made under the Bill.”


The Minister will know that the NPA has serious doubts about the suggested economic efficiency of the hub and spoke model, particularly in light of the impact assessment’s uncertainty. Under the five-year community pharmacy contractual framework agreement, the PSNC is tasked with the role of agreeing hub and spoke models which will allow the sector to benefit fairly. Can the Minister explain to the Committee how it is envisaged that hub and spoke models will be able to operate to ensure that the arrangements are fair to all pharmacies?

The NPA has stressed that, without a level playing field, competition and choice in the pharmaceutical wholesale market could be reduced by the pressure to set up or join hub and spoke arrangements. The resilience of the medicines supply system could be impacted, and medicine prices could rise as a result. As the NPA says, huge barriers will need to be overcome to make any model fair and appropriate for independents, including the risk of introducing new process errors, lack of clarity on the ownership of problems between the hub and spoke, longer lead-in times and impact on procurement margins—essentially, a reduction in system resilience and problems caused by restrictive distribution arrangements.

The impact assessment stresses that the proposed regulatory change is intended to be entirely permissive, with pharmacy businesses developing hub and spoke arrangements only where they deemed it would be

“beneficial for them to do so”.

Paragraph 255 sets out three types of hub and spoke arrangement that could be entered into, underlying the complexity of the range of models and reinforcing the need for greater consideration and thought to be given as to how further hub and spoke models could be introduced.

The Company Chemists’ Association, the trade body for large community pharmacy operations, which include Boots, Lloyds, Asda, Morrisons, Tesco and Superdrug, has expressed particular concern at hub and spoke models being introduced through secondary legislation and stressed the importance of extensive consultation with the industry—in fact, the consultation on the future of the industry began in 2016 but has yet to be concluded. When and how will consultation on this vital matter, which sees the most significant changes to pharmacy in decades, commence?

The Minister has rightly praised the contribution of independent pharmacies, particularly during the Covid pandemic. However, we know that, before Covid, more than half reported operating at a loss, a situation greatly exacerbated by Covid and extra costs, which led to their income decreasing while their role in the community became more important than ever, working long hours with often reduced staffing numbers, providing advice and support and supplying medicines. In rural areas, such pharmacies have always played a key role as often the only source of information and advice as well as of prescriptions and medical equipment. During Covid, in many areas they were and are the only primary healthcare professionals that patients can still see in person. What progress has been made in the discussions with the sector about additional funding on Covid costs? The £370 million provided in July was an advance payment to an already struggling industry rather than new money. Can the Minister place on record how much additional funding has been provided? My noble friend Lord Hunt will expand on this issue of funding community pharmacies and the wider pharmaceutical industry in relation to the price regulation scheme.

I want briefly to express support for Amendment 29 in the name of the noble Lord, Lord Clement-Jones, which would place a duty on the Secretary of State to consult the pharmaceutical, wholesale and pharmacy sectors and their regulators on an agreed framework for the safe transfer of patient data, prescription information and dispensed products between separate hubs and spokes. This and other provisions in the amendment would provide some vital safeguards if hub and spoke models are developed in future secondary legislation. We strongly support the noble Lord’s approach.

As I stressed earlier, the nine paragraphs of the impact assessment do not represent a strong or coherent case for moving forward at this time under the secondary legislation enabled by the Bill. Instead, they demonstrate the need for more thought, analysis and development of proposals for the future delivery and transformation of pharmacy services, with full involvement of and consultation with the industry, including on extending hub and spoke models. That would ensure a fair and level playing field and the survival of the independent local community pharmacies so valued by patients and their families and carers. I beg to move.

[Lord Clement-Jones (LD)]

My Lords, I want to speak to Amendment 29 in my name and those of the noble Lord, Lord Hunt, and my noble friend Lady Jolly. I thank the noble Baroness, Lady Wheeler, for her support and comprehensive exposition of the issues involved with regulation in respect of hub and spoke.

Like the noble Baroness’s amendment, mine is an attempt to flesh out concerns about the lack of detail in the regulation-making powers under Clause 2(1)(c) as regards authorising hub and spoke arrangements and the process by which new regulations will be agreed. For the record, I should say that “hub and spoke” describes how prescriptions are sent from a community pharmacy “spoke” to a central premise, or “hub”, for assembly, often using automated technology. The assembled medicines are then distributed back to the community pharmacy “spokes” for collection by patients. By removing elements of the existing workload in pharmacies, centralised automated assembly can give the pharmacist and their team more time to deliver healthcare services and advice and to support patients who have urgent and acute needs. This is not the same as an online-only pharmacy or a delivery system. It is not a means to enable home delivery of prescription items. There are significant costs of both setting up and running hub and spoke facilities, but it frees up capacity.

It is not blindingly clear on the face of it but, as a result of powers given under the Medicines and Medical Devices Bill, the Government intend to enable medicines assembly through hub and spoke models across legal entities, which is not allowed under current legislation. It is important that this technology is harnessed for the benefit of patients and the NHS within an agreed framework.

Over the past decade, many pharmacists have invested significantly in hub and spoke technology and use it to release capacity in their community pharmacy branches. It is hoped that, if wider use of the hub and spoke model can be permitted, this capacity can be used to enable community pharmacy teams to provide more clinical services to patients.

Noble Lords participating in Committee will be only too aware that community pharmacy is already helping the NHS in providing services and wants to deliver more. At a recent meeting with pharmacists I heard how, through freeing up capacity, hub and spoke arrangements support the delivery of essential and more advanced pharmacy services such as medicines use reviews, diabetes control, support during taking new medicines, minor ailments and vaccinations. NHS England, likewise, wants to open up the market to new technologies and enable greater efficiencies to be found in medicines supply, but the major pharmacy players believe that this can happen only if other barriers to automation are addressed through the community pharmacy contractual framework at the same time.

The noble Baroness, Lady Wheeler, mentioned the impact assessment and the need for much greater clarity on how the Government will deal with the barriers on the way to realising the efficiency benefits of hub and spoke. These barriers, over and above those mentioned by the noble Baroness, include, first, original pack dispensing. Very often, the quantities prescribed by doctors do not match the amount of medicines in the packs produced by the manufacturers. Pharmacy teams in England and Wales manually “snip” the plastic strips of pills to either add or take away from the manufactured quantity. Snipping is a time-consuming and expensive manual intervention that cannot be automated or delivered at scale.

A second barrier is the need for government support for infrastructure investment. Despite its potential, less than 10% of prescription items are currently dispensed using hub and spoke technology. The industry has already invested tens of millions of pounds in this technology. Government capital investment is needed for it to expand further.

A further barrier relates to fair community pharmacy funding, mentioned by the noble Baroness. The level of remuneration for pharmacy has been a challenge for some time. It needs to be addressed to help the sector to deliver the urgent care and services that the NHS badly needs, especially in the current Covid environment. This is even more important if pharmacy capacity is increased and there is a real prospect of enhancing pharmacy services to fill it.

The noble Baroness has explained the concerns over secondary legislation. I hope that the Minister will address some of these issues in her response and explain how she sees the extension of the hub and spoke dispensing model taking place and how consultation and agreement on a framework will take place.

--- Later in debate ---

[Baroness Penn (Con)]

My Lords, the commitment on the consultation is that it would be a public one, in line with the government amendment on what type of consultation we need to undertake for regulations made under the Bill. That would therefore include patient groups. On the content of the consultation, I understand that when it first took place it was very open, to hear from the sector how it would want to make use of the powers. My understanding is that we have heard the need to have a more structured conversation on the framework for how these powers could deliver the benefits which people think they could. Maybe I could undertake to write to the noble Lord with some more detail on that.

[Baroness Wheeler (Lab)]

Some of the points I was going to come back on have been raised pertinently by the noble Lord, Lord Clement-Jones, and my noble friend Lord Hunt. I too thank the Minister for her full and comprehensive response, and I thank all noble Lords for their contributions. Between us, we have covered a pretty comprehensive range of the issues and concerns around this. However, the Minister has not really made the case that warrants the use of the delegated powers contained in the Bill, nor met the criteria of the DPRR Committee—in particular, that the use of secondary legislation needs to be justified. The words of the DPRR were that the department should “acknowledge the breadth” and depth of the powers proposed and justify them. I do not think that has yet been done.

My noble friend Lord Hunt raised the complex issues on funding, as have other noble Lords. There is much to be achieved in putting funding on a stable footing for community pharmacists. The Minister was unable to answer the specific questions on the £370 million that my noble friend raised, but there needs to be recognition of extra costs. That point has been made forcefully in the House, in questions to the Minister, and I hope that the Government will make that response.

Overall, the Minister has not fully answered the key question of how these proposals fit into the longer-term NHS plan for transforming pharmacy as an integral part of primary care. There are a number of issues around that, which is why we particularly wanted to see a comprehensive plan going forward. Where is the overall strategy and plan for this?

The noble Lord, Lord Clement-Jones, raised a number of issues about how we want to take the development of pharmacists forward. The prescribing powers set out in the Bill are obviously the road to that, but I still do not have a comprehensive picture of how all this fits together. It comes back to the fairness of hub and spoke. Yes, of course the legislation is permissive, and community pharmacies will not have to join hub and spoke arrangements if they do not want to, but the complexity of some of the models proposed and the power of the large-scale providers really make the level playing-field so important—and important to the survival of community pharmacists—that we need to be much clearer about how it is going to work out.

I certainly welcome the commitment on consultation. That is so vital and, as everybody has said, the 2016 consultation was never really completed. As the Minister explained, there was neither the time nor the follow-through for it. I hope that this one will be comprehensive. I would have liked to have heard some kind of timescale but that is obviously yet to come. Much remains unanswered, which we may need to come back to on Report. We will look carefully at Hansard, but meanwhile, I beg leave to withdraw my amendment.

Amendment 23 withdrawn.