Boots' move described as 'subsidisation'

The reduction of prices on certain drugs by Boots, while the cost of others sold by the pharmacy will increase, has been described as a form of subsidisation.

The Consumer Association of Ireland(CAI) had initially welcomed the announcement on Monday that Boots was changing its pricing system in a way that would cut the cost of the ten most-expensive prescription medicines by an average of 25%.

CAI chief Dermott Jewellsaid that a fuller picture had emerged since the original announcement was made on Monday.

"The difficulty that has come across in the last 24 hours is that... we're still just seeing a shifting in the pricing structure, I mean Boots themselves have admitted that other prices will increase, so its a form of subsidisation," he said.

Boots has acknowledged that the prices of some of the most commonly prescribed medicines will increase.

Boots' Director of Pharmacy Mary Rose Burke said that while no prices were being increased to compensate for price reductions elsewhere, the retail price of some low cost medications would be impacted by a flat rate fee of 7.

"The new pricing structure that moves to a 0% mark up on the price of medicines and replaces the traditional dispensing fee with a new service fee, that for products that are very very cheap and we're talking about medicines that the cost is less than 4, there is a marginal increase," Ms Burke said.

"But most people would not get those medicines on their own, we're talking about products like aspirin. But for someone with cardiovascular disease taking aspirin and maybe a blood pressure lowering medicine and a cholesterol lowering medicine, they will see savings in the order of 300 a year."

Ms Burke said she would dispute the validity of surveys that have suggested that Boots is one of the most expensive pharmacies.

Mr Jewell said it was clear that the change in Boots' medicines pricing structure was already leading to increased competition, with the Sam McCauley chain moving to a flat rate charge, at the slightly lower amount of 6.95.

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Boots' move described as 'subsidisation'