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Medicines price war escalates as chemists battle with retail giant

A PRICE war has broken out among local pharmacies sparked by competition from a supermarket giant.

Intense competition in towns where Tesco recently opened in-store pharmacies has led to dramatic price reductions for prescription medicines in those areas, the Irish Independent has learned.

Customers can now save nearly €300 a year on the country's top-selling medication because independent pharmacies are fighting back against the might of multinational chains.

Pharmacies in Portlaoise, Co Laois and Naas, Co Kildare, where Tesco opened pharmacies last year, have slashed prices in a bid to keep customers.

This has led to savings of up to 36pc on the price of lifesaving drugs -- raising the prospect that customers elsewhere could benefit if Tesco proceeds with plans to roll out up to 15 such outlets nationwide.

Surprisingly it is the small independent pharmacists who have cut their prices the most.

A month's supply of cholesterol-lowering Lipitor now costs €41.70 in Hughes pharmacy in Portlaoise -- cheaper than the €48.12 charged at Tesco and much less than the €65.77 price tag in nearby Boots.

That means a patient on this top-selling heart drug could knock €289 a year off their drug bill by choosing the cheapest pharmacy, a survey by the Irish Independent has found.

Tesco opened up a pharmacy in Portlaoise in November and we found that several other pharmacies in the town are now charging around €52 for Lipitor.

That works out at €13 a month cheaper than the typical price of around €65 charged elsewhere in the country.

A similar trend is seen in Naas where Tesco also recently opened a pharmacy outlet, promising to cap its prescription drug mark-up at 20pc over the wholesale rate.

Burkes, Monread and Poplar pharmacies in the Kildare town are among those now charging less for prescription drugs than the going rates elsewhere.

For example, they charge around €41 to €42 a month for ulcer drug Esomeprazole, compared to €50 at Boots and €51 at Unicare, while blood-pressure lowering Co-Diovan is around €8 a month less.

Small independent pharmacists are leading the way in cutting prices. However, large pharmacy chains, such as Boots and Unicare, have so far resisted pressure to reduce prices.

One pharmacist in Naas, who did not want to be named, told the Irish Independent the arrival of Tesco had definitely intensified price competition.

"Customers are highly price sensitive and we have to try and match the lower prices where possible," he said.

Competition

Other pharmacists said price competition had been extremely keen, even before Tesco arrived.

However, prices in urban areas around the country without supermarket competition still remain stubbornly high.

The Consumers Association of Ireland praised the independent pharmacies cutting prices, and urged others to follow suit.

"They are showing what can be done," said CAI chief executive Dermott Jewell .

The National Consumer Agency said more should be done to drive competition by forcing pharmacists to display their mark-ups and dispensing fees, as urged in a recent Economic and Social Research Institute report.

"The Agency believes that, in order to make an informed choice, consumers should have easy access to full price information," it said.

Irish Independent