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GSK introduce new Manufacturer's Discount Scheme
Most practices will see fall in income
Dr Philip Koopowitz reports
30th of June 2009
GSK, were the original company to introduce direct to pharmacy and dispensing doctors. They have recently reviewed their discount structure. Previously all GSK products received a discount of about 7 %, depending upon usage, with an enhanced discount for their promoted products, including Seretide, Avandamet, Avandia, Avodart and Flixonase.
The enhanced discounts often made up for the difference between the 11,18% discount clawback that most dispensing doctors have taken from the Basic Price and the 7% discount given by GSK.
The good news is that ALL GSK products (excluding vaccines) will now have a 12% discount applied. GSK seem to be the first major manufacturer to acknowledge that it is now costing more for dispensing doctors to dispense their products than they receive in fees and discounts. This means that there will be at least a 0.82% profit on each of their products.
In addition, dependant upon past usage, Seretide, Avandia, Avandamet, Avodart and Avamys could be eligible for a further discount.
Although this sounds good, the overall effect will be a reduction in total discount for over 75% of dispensing doctors. The reduction for some will be large, but for others will mean a loss of up to £1000 a month.
With the increasing squeeze from Category M, loss of MDS from major manufacturers and reduction in wholesalers discount via the Direct to Pharmacy logistics, is it not time to press the Department of Health on the Discount Abatement Scale?