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Drug price plunge as Tesco launches its pharmacy war

Tesco has pledged a retail mark-up of 20pc with an inbuilt dispensing fee of €3.50 per item.

This will mean, for example, that a month's supply of the cholesterol-lowering drug Lipitor will sell for €48.12 in Tesco compared with €65.77 in Boots while the anti-hyperactivity drug Ritalin will cost €63.04 compared with €86.07 at Boots.

The Consumers' Association of Ireland has welcomed the new competition.

"However, its important that any new element of competition is not short-lived and we will be monitoring Tesco prices to make sure they don't hike up their margins once they've got established," said association chief Dermott Jewell.

Concerned

National Consumer Agency chief executive Ann Fitzgerald said she had been concerned about the lack of transparency surrounding drug pricing but the Irish Pharmacy Union was concerned that the move would have serious implications for community pharmacists.

"It's going to be a real issue for independent pharmacists in towns near these outlets as it will be incredibly difficult to compete," said president Darragh O'Loughlin.

He said it was impossible to predict what would happen on prices in competing outlets, saying consumers tended to shop around for the price and service that suited their needs.

Up to now only a small number of independent pharmacies have offered cheaper prices.

Increase

These include Brassil's Pharmacy, in Ballyheigue, and Ahern's, in Farranfore, both in Co Kerry. John Brassil said he had made the decision two years ago to peg drug prices at the lower HSE rates and had seen a significant increase in business as a result.

"I felt it was only fair to charge customers the lower rates when times are difficult for everyone", he added.

Tesco superintendent pharmacist Mark Beddis said it would be helpful to consumers if pharmacies could advertise prices.

They are currently precluded from doing so.

csheehy@herald.ie


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