Actually mate you do need a little education.Nothing wrong with...

Actually mate you do need a little education.

Nothing wrong with having a strong representative organisation like the Pharmacy Guild. Their main lobbying strength has been in building professional services (Home medication Review & Dose Administration Aids etc) at the ground level by securing Govt support for various programs. However, if you think they have been responsible for pushing prices up in the last 10 years think again they have had no clout in this area for years. Retail price maintenance went away 20 plus years ago - they had some influence before that. The Government sets the pricing structure and has screwed Pharmacists and Wholesalers relentlessly. Do you have any idea about PBS margins and dispensing fees. Would you stock an item worth $1000 for a $20 margin plus a dispensing fee of about $6 or margin of $10s on a $100 item. And you can shop around for non PBS items or items under the PBS threshold. Many Chemists are operating on 15% margins for non PBS items (used to be around 70% in the halcyon days. The only bright spot for pharmacists has been generics but the Govt is slowly screwing us there also. Once the fight for market share is resolved discounts to pharmacy will shrink.

The cost of medicines is dictated by the manufacturers my friend - patent protected or unique products and strong brands. Globalisation of pharmaceutical pricing and returns has pushed prices up in Australia. Years ago the Govt had some balls and negotiated very strongly with maunfactures if they wanted PBS listing. Now they accept world parity pricing to a large degree.

Try shopping for prescription medicines in the USA and see what paying too much for drugs is all about. No wonder Obama is trying to implement reforms and adopt a system similar to Australia.

So it is Govt Policy that has been screwing Sigmas wholesaling returns but has been reasonably good on the manufacturing front except there is pressure on their generic margins. For Sigma future strngth will lie in building their generic market share and with first off the rank "off patent" blockbusters. Also building its consumer ranges (e.g. Herron) and OTCs and Pharmacy brands. Contract manufacturing will also be a growth area.

I'll take a breath now!

Woolies might get in one day but I can guarantee the way the PBS Scheme works they could not operate any more competively than what already exists. Sure given their grunt and "loss leader" and promotional tactics they could close a lot of small community pharmacies. Howver, your grandmother will have to catch the bus to the big Woollies instead of riding her gopher up the street to the small shopping centre pharmacy (and get terrific personal caring service) like the one I work in.