New pharmacies undercut rivals to drive price war on prescriptions
Pressure on pharmacies to cut prices will soar after another retail chain began heavily discounting prescription medicines.
Several chains have sprung up with a business model of selling large volumes of medicines at deep discounts.
Critics complain that standard retail pharmacies charge a high margin for medicines dispensed to private patients.
This has resulted in large numbers of pharmacies with multiple outlets even in small towns and villages.
Now Pure Pharmacy, which has operations in Dublin, Galway and Louth, says it is discounting prescription medicines by up to 60pc for private patients - those who do not have a medical card.
It has six pharmacies, in Dublin, Galway city and Drogheda, Co Louth.
The chain offers all cholesterol-reducing statins - one of the most widely prescribed medicines - at €4 for a month's supply.
This compares with between €12 and €14 for a month's supply in most retail pharmacies, according to Pure Pharmacy managing director David Beggs.
He said his operation was able to undercut conventional pharmacies because it does not charge a mark-up, which is often 50pc in retail chemists.
Pure Pharmacy has no subscription fees, unlike other pharmacy discounters that have the same model of high-volume sales at low prices.
The high cost of prescriptions for private patients recently prompted a consultant clinical pharmacologist and expert on the prices of medicines to call for a cut to the profit margins charged by retail pharmacists on privately purchased medicines.
Prof Michael Barry said the margins being earned by pharmacists mean that private patients end up paying as much as double the original cost of prescription drugs.
The Trinity College Dublin-based academic questioned dispensing fees of between €3 and €5 per item, and mark-ups of 50pc of the ingredient cost.
Although prices have come down, medicines are often cheaper in the North, in Spain and in Portugal. Mr Beggs said he was throwing down the gauntlet to other pharmacies to reduce their prices.
"Our concept is lower prices. We buy competitively and we pass that value on to our customers," he said.
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"We can offer all statins for €4 for one month's supply, Ventolin for €3.50 for one inhaler and aspirin at €3.50 for one month's supply."
Both Healthwave in Dundrum, Dublin, and Limerick-based Limitless Health offer medicines at major discounts. Customers pay an annual subscription fee to Limitless Health.
The Irish Pharmacy Union (IPU), which represents chemists, defended its pricing, saying pharmacies have to cover the cost of dispensing medicines and the cost of the professional review carried out by the pharmacist.
An IPU spokesman said that, from 2009 to 2015, the total fees paid to pharmacies by the State has reduced by more than 8pc from €420m to €388m.