Can a pharmacy enter into an arrangement with a supplier to only stock that supplier's brand of a particular drug?

There are several important factors to consider if a pharmacy is asked to enter into such an arrangement:

• Where a drug is prescribed generically, a pharmacist is free to supply any generic brand or any manufacturer's product that meets the specification requested by the prescriber. However, where a drug is prescribed by brand name or a specific manufacturer's product is requested, the pharmacist is legally obliged to supply that brand or manufacturer's product, with very limited exceptions such as approved licensed parallel imports or in certain cases of emergency.

• Pharmacies with an NHS contract are contractually obliged to supply against NHS prescriptions; the pharmacy must be able to supply "with reasonable promptness" the prescribed drug and it may be a breach of those terms if it cannot do this. If an exclusive arrangement prevents a customer from obtaining a specific drug (whether it be a brand or generic) then the pharmacy may be breaching the terms of its contract with the NHS.

• The OFT recently confirmed that exclusive distribution arrangements are likely to be watched closely in the upcoming months in light of their effect on competition. Whilst their concern is mainly with the introduction of large-scale 'Direct to Pharmacy' schemes, any exclusive distribution agreements may be under scrutiny from the OFT and Competition Commission if they have an impact on competition in the sector.

• Ethically, pharmacists should be complying with both the Code of Ethics for Pharmacists and Pharmacy Technicians and the Professional Standards and Guidance for the Sale and Supply of Medicines. Pharmacists must always act in the best interests of the individual customer and not allow their professional judgment to be impaired by commercial interests. Pharmacists are also obliged to avoid any conflict of interest and declare any such conflict to those affected, which could be professionally embarrassing.

An exclusive arrangement could therefore put pharmacies and pharmacists in a very difficult position with both customers and prescribers and they may find themselves in a position whereby compliance with their professional codes of conduct are likely to be compromised. As a consequence it is strongly advisable pharmacies consider their position carefully before entering into an exclusivity arrangement and seek proper legal advice about the effect of such an agreement.

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