Consultation outcome

Government response to the consultation on hub and spoke dispensing

Updated 13 May 2024

Executive summary

Dispensing covers a number of processes. Within the ‘hub and spoke’ models, multiple ‘spoke’ pharmacies receive prescriptions and a ‘hub’ pharmacy carries out the more routine aspects of dispensing of those prescriptions on a large scale, potentially using automation. This is only possible now between pharmacies within the same legal entity. The proposals enable the use of hub and spoke models between pharmacies owned by different legal entities, so levelling the playing field in community pharmacy and enabling spokes to provide more patient-facing services, relieving pressure on the wider NHS.

Enabling hub and spoke across different legal entities was agreed in the Community Pharmacy Contractual Framework 2019 to 2024 in England and referenced in the Primary Care Recovery Plan and the NHS Workforce Long Term Plan.

We consulted UK-wide on the policy between 16 March to 8 June 2022. The proposals went beyond simply removing the barrier that currently limits hub and spoke models to pharmacies within the same legal entity as they also included elements to ensure the safe and effective implementation of the policy by putting in place provisions to ensure accountability, governance and transparency for patients.

Two different models for hub and spoke dispensing were proposed, as described below.

Model 1

Model 1 is where the patient presents a prescription to the spoke. The spoke then sends the relevant information on to the hub so that they can carry out their agreed dispensing actions. The hub then sends these dispensed medicines back to the spoke, which may have further responsibilities to perform such as providing advice on the medicine to the patient, before supplying them to the patient.

Model 2

In model 2, the same pathway is followed in that the patient presents a prescription to the spoke, which then sends the relevant information to the hub. The hub then assembles and prepares the medicine before supplying the completed order directly to the patient.

Overview of responses to the consultation

We received 131 responses to our online questionnaire, from 71 individuals and 60 interested organisations, including:

• 22 pharmacy businesses across the range, from independents to large multiples
• membership organisations
• national community pharmacy representative bodies
• pharmaceutical wholesalers
• professional advisory bodies and regulators

Summary of the changes to be made as a result of the consultation evidence

The government consulted on a number of amendments to the Human Medicines Regulations 2012 (HMRs) and the Medicines Act 1968. In light of the consultation evidence and further discussions in some cases, the government intends to progress the proposals to enable hub and spoke models across different legal entities as soon as possible by using the enabling powers in Part 2 of the Medicines and Medical Devices Act 2021 (MMDA) to make amendments to the Medicines Act 1968 and the HMRs.

The proposed amendments to be made to the Medicines Act 1968 are:

• amending section 10 of the act, to remove the restriction that a medicine dispensed at a registered pharmacy must be sold or supplied by that pharmacy or another registered pharmacy forming part of the same legal entity
• removing section 131 of the act, which covers the definitions of wholesale dealing, retail sale and related expressions. Therefore, by virtue of section 132 of the act, the definitions of those terms will now be those found in the HMRs to ensure clarity across the legislation

The proposed amendments to be made to the HMRs include:

• the creation of 2 new models of hub and spoke: model 1 (spoke-hub-spoke) and model 2 (spoke-hub-patient). This will be done by creating 2 new regulations in the HMRs - regulations 222A (for model 1) and 222B (for model 2)
• the creation of 2 new types of retail sales to sit alongside a retail sale as it is currently governed. In models 1 and 2, a ‘deemed retail sale’ will be created to allow the movement of assembled or part-assembled medicines between the hub and the spoke. In model 2, a ‘parallel retail sale’ will be created between the spoke and the patient. For more explanation, see Annex A, below
• that there must be written arrangements between any hub and spoke, which must include a comprehensive statement in relation to their responsibilities and details of which party will be named on the medicine label. There will be flexibility for the hub and spoke to determine whether the label will feature either the hub or spoke’s details, but never both
• that the spoke must conspicuously display a notice in relation to hub and spoke models, if utilising them. If a pharmacy (including a distance selling pharmacy (DSP)) and/or a dispensing doctor has an online presence and utilises a hub and spoke model, their website should display the same information conspicuously
• that dispensing doctors will be able to act as a spoke under the new regulations
• the creation of an information gateway in the HMRs (as a new regulation 222C) - this achieves several purposes, including the provision of an assurance that the data sharing across the different legal entities is lawful

The consultation evidence and further discussions have enabled us to understand concerns and queries in detail. Our responses to these follow.

There were queries about whether Medicines and Healthcare products Regulatory Agency (MHRA) good distribution practice (GDP) standards would apply to any movement of medicine between hubs and spokes. We will not require hub and spokes to meet MHRA general distribution practice standards. Movement of prepared or assembled medicines between hub and spokes is already covered by existing regulatory standards.

There were queries and concerns about how regulatory oversight would be ensured for the hub and spoke models. Existing regulatory arrangements for community pharmacies across the UK guarantee end-to-end regulatory oversight of hub and spoke models and no further changes are needed. Where dispensing doctors form a spoke, end-to-end regulatory oversight will be established either through existing arrangements or the relevant devolved administrations taking appropriate action.

Respondents asked whether controlled drugs could be dispensed using the hub and spoke models. Schedule 3, 4 and 5 drugs can be included in hub and spoke model 1 and schedule 4 and 5 drugs can be included in hub and spoke model 2. We intend to explore with the Home Office the inclusion of schedule 2 drugs within either model of hub and spoke and schedule 3 drugs within model 2.

Concerns were raised about the impact of the hub and spoke models on competition. In line with the recommendations from the Competition and Markets Authority (CMA), the department commits to engaging with stakeholders to review the impact on competition once the market is sufficiently established.

Other matters were raised that are outside the scope of the HMRs - for example, queries about market entry and reimbursement. These will need to be considered further in conjunction with the community pharmacy representative bodies in each administration, in order to determine if amendments to other secondary legislation are appropriate.

Concerns were raised in relation to implementation of the hub and spoke models across Great Britain and Northern Ireland. These comments were made in the context prior to the Windsor Framework as the consultation was held before it was agreed on 23 February 2023. The concerns raised by stakeholders in relation to the previous context of Northern Ireland should therefore no longer apply.

Our intention is that, subject to approval of the statutory instrument by the Houses of Parliament and the Northern Ireland Assembly, the proposed legislative amendments will come into force on 1 January 2025, to tie in with the commencement of the Windsor Framework and to allow sufficient time for secondary legislation to be amended, as appropriate. This also gives the pharmacy sector time to explore the relevance of the new hub and spoke models to their businesses.

1. Background to the consultation

Between 16 March and 8 June 2022, the government consulted on pursuing legislative change to enable all community pharmacies and dispensing doctors to access the hub and spoke dispensing models.

Dispensing covers a number of processes and includes activities such as the taking in of a prescription, the clinical and accuracy checks, the sourcing of products, the preparation, assembly and supply of medicines and providing advice to and counselling a patient, for example, to ensure that they know how and when to take the medicine. Traditionally, all of these different processes have been done in a single pharmacy based in the community or by a dispensing doctor (GPs providing NHS primary medical services who also dispense medicines and are normally found in remote or rural areas).

Hub and spoke dispensing models enable the routine aspects of dispensing prescriptions to take place on a large scale at a different pharmacy (‘the hub’) to the pharmacy at which the prescription was handed in to (‘the spoke’). At the moment, this can only happen where both pharmacies are within the same legal entity. Existing hubs usually make use of automated processes bringing about economies of scale and efficiencies. Typically, there are many spokes to one hub.

Because it is only possible for pharmacies that belong to the same legal entity to operate using a hub and spoke model, the efficiency benefits of hub and spoke cannot be realised by independent pharmacies, dispensing doctors or those pharmacies linked in smaller chains. Removing the legal restriction will therefore level the playing field in community pharmacy.

The policy proposals go beyond simply removing the barrier that currently limits hub and spoke models to pharmacies within the same legal entity as they also include elements to ensure the safe and effective implementation of the policy by putting in place provisions to ensure accountability, governance and transparency for patients. These additional proposals are designed to make sure that patient safety outcomes from the hub and spoke models are equal to current dispensing models. Ensuring that the hub and spoke models have clear accountability, governance and transparency of information measures are key to delivering high standards of patient safety and so these requirements underpin the proposals.

For the purposes of clarity, throughout this document when we refer to a ‘hub’, we mean a registered pharmacy premises that is acting as a hub, where there are written arrangements in place between the hub and the spoke. When we refer to a ‘spoke’, we mean a registered pharmacy premises or a dispensing doctor that is acting as a spoke, where there are written arrangements in place between the hub and the spoke.

The government previously consulted on extending the hub and spoke models in 2016 and published its response to the 2016 consultation in November 2021.

Alignment with original pack dispensing  

These proposed changes align with amendments made to the Human Medicines Regulations 2012 (HMRs) in September 2023 to enable original pack dispensing (OPD) in Great Britain. Provision was made in the HMRs for a transition period to allow time for England and Wales to consult with their appropriate community pharmacy representative bodies on how OPD will apply in NHS pharmaceutical services in their territory. In England, addressing these implications will likely involve changes to the NHS (Pharmaceutical and Local Pharmaceutical Services (PLPS)) Regulations 2013.

Currently, pharmacists must, with a few limited exceptions, supply the exact quantity of medicine prescribed. This means that where the quantity prescribed on a prescription is not equal to a pack size, pharmacy staff need to split a manufacturer’s original pack in order to dispense the prescribed quantity, which takes time and reduces efficiency. Splitting packs cannot typically be done by machines that automate the dispensing process. The amendments to enable OPD also support increased patient safety because they ensure that more patients will receive the manufacturer’s original packaging, which includes necessary information to support patients to take the medicine safely and effectively. By giving pharmacists flexibility to dispense up to 10% more or less than the prescribed quantity, the volume of medicines dispensed in the manufacturer’s original packs is expected to increase overall, and so reduce the number of times a manufacturer’s original pack has to be split, which in turn increases the number of prescriptions that can be dispensed through the automated processes that hubs are likely to employ.

2. Our proposals for reform

1. Removing the restriction on hubs and spoke models across different legal entities and enabling 2 different models to provide flexibility

In our consultation, we proposed to remove the restriction in section 10 of the Medicines Act 1968 which prevents a medicinal product from being sold or supplied at a pharmacy that belongs to a different pharmacy business from the one at which it was dispensed. This, alongside the other proposed amendments to legislation, would expand the scope of hub and spoke dispensing to pharmacies and dispensing doctors that do not belong to the same legal entity. The policy objective was to enhance efficiency in working practice by freeing up time for dispensing staff at the spoke so that they can provide more patient-facing services and so better support patients and other parts of the NHS which are under pressure. For example, if a pharmacist has more time to provide clinical services and advice on medication, this could have the effect of freeing up more GP appointments. This complements other strands of policy development that are designed to maximise the use of skill mix in pharmacy teams, including, for example, the proposal for the use of patient group directions (PGDs) by pharmacy technicians and the pharmacy supervision proposals - the consultation on changes to supervision ended on 29 February 2024 and the responses are currently being analysed.

We proposed to enable 2 different models of hub and spoke dispensing. In model 1, the patient presents a prescription to the spoke. The spoke may carry out some of the dispensing actions, for example the clinical check, and once completed will then send the relevant prescription information to the hub pharmacy. The hub will then assemble and prepare the medicinal products before sending the completed order back to the spoke, which ultimately supplies that order to the patient. In model 2, the same pathway is followed in that the patient presents a prescription to the spoke, who may carry out some of the dispensing actions, for example the clinical check, before sending the relevant prescription information to the hub pharmacy. The hub will then assemble and prepare the medicinal products before supplying the completed order directly to the patient.

We proposed to remove section 131 of the Medicines Act 1968, so that the definitions of wholesale dealing, retail sale and related expressions will be the same as those within the Human Medicines Regulations 2012. This avoids us having 2 different sets of definitions in medicines legislation and provides clarity.

2. Changes to the HMRs to ensure patient safety, governance, transparency and accountability and access for dispensing doctors as part of hub and spoke models

In the consultation, views were requested on the following proposals.

1. We proposed expanding the concept of a ‘retail sale’ as part of the draft regulations to:

• create a new ‘deemed retail sale’ that would only apply in the new hub and spoke dispensing models to govern the movement of medicines between the hub and the spoke after they have been prepared or assembled
• create a new ‘deemed retail sale’ between the spoke pharmacy and the patient in model 2, despite it being the hub pharmacy supplying the medicines to the patient

2. To ensure accountability for patient safety and so that both the hub and the spoke know what dispensing activities they are expected to fulfil, we proposed that registered pharmacies and dispensing doctors who participate in a hub and spoke model would be required to enter into arrangements with one another.

3. We proposed enabling dispensing doctors to be able to act as a spoke in hub and spoke models should they so wish.

4. To provide transparency for patients, we proposed that the spoke pharmacy (and a dispensing doctor acting as a spoke) should be required to conspicuously display the name and address of any hub pharmacies with whom they have entered into arrangements.

5. We proposed to provide autonomy to the hub and the spoke, as part of the arrangements that they must enter into, to decide between themselves whose details are to appear on the outer packaging or dispensing label of the medicine they supply. 

6. We asked respondents for their views on whether a possible change to legislation should be considered to allow the supply of medicines from the spoke to the hub, to ensure, for example, that a complete prescription can be prepared or supplied to the patient.

7. We proposed changing references to supplies of medicines “on pharmacy premises” to “at or from pharmacy premises” within the HMRs, to clarify the position in legislation where medicines are, for example, delivered to patients “from a pharmacy”.

3. Methodology

In this section, we provide an overview of the ways in which individuals and organisations could respond to the consultation and levels of engagement.

Format and participation

The online questionnaire was launched on 16 March 2022 and remained open for 12 weeks, closing on 8 June 2022. The questionnaire contained a combination of ‘closed’ tick box questions (where respondents could indicate the extent to which they agreed or disagreed with a statement) and ‘open-ended’ questions (where respondents were free to enter any text up to a word limit). As the questionnaire contained a mixture of closed and open-ended questions, both quantitative and qualitative analysis was used to analyse the responses to understand the broad range of views and experiences.

In total there were 131 responses to the questionnaire, of which:

• 71 were from individuals
• 60 were from organisations

Two organisations sent in 2 responses each, from different sources - these have been counted as separate responses. A further stakeholder engagement workshop was held on 6 December 2022 to provide us with more detailed responses on the labelling of medicines and spoke to hub supply. In October 2023, we held 2 further meetings, each with one external stakeholder who had offered to provide information relevant to the impact assessment.    

For more detail on the demographic characteristics of the individual respondents and other characteristics of the organisations that participated in the consultation, see Annex B.

The government is grateful for the responses received from all respondents and values the comments and views submitted. We would particularly like to thank those individuals and organisations that went to significant effort to share detailed observations, relevant data, case studies and reports during the consultation and in subsequent meetings. This material has been extremely useful to our work, has informed the drafting of the legislation and improved the robustness of our impact assessment.

Generalisability

We are pleased with the level of response to the consultation from a wide variety of relevant stakeholder organisations as well as from individual pharmacy businesses. Although we only received a direct response from a relatively small number of multiples (defined as businesses which are part of a chain of 21 or more pharmacies), we understand that their views were expressed within the responses received from membership organisations that represent multiples. Responses from individuals and organisations represented all territories of the UK.

4. Views on enabling hub and spoke across different legal entities and the proposed hub and spoke models

On removing the legal restriction

We asked respondents to indicate the extent to which they agreed or disagreed with the proposal to remove the impediment in medicines legislation that prevents the operation of the hub and spoke models across different legal entities.

Summary of responses

Overall, more respondents agreed than disagreed that the legislative impediment should be removed. Eleven respondents did not agree or disagree with this proposal. Of the remainder:

• 53% of respondents supported the proposal - 29% (35) agreed strongly and 24% (29) agreed
• 47% respondents disagreed with the proposal - 35% (42) strongly disagreed and 12% (14) disagreed

Although the numbers make the overall split look quite close, it should be noted that these totals give an individual response the same weight as an organisation, despite the fact that an organisation could represent hundreds of members or thousands of employees.

When we looked at organisational responses separately to individual responses, it was clear that more organisations were supportive (71% of organisations in favour, of the 52 that expressed a preference) whereas individuals were less supportive (with only 29% of individuals in favour, of the 68 who expressed a preference).

The supportive organisations included 7 national associations, 5 large pharmacy chains (with over 1000 employees each), 8 smaller pharmacy chains, other providers and organisations representing community pharmacy policy and practice in Wales, Scotland and Northern Ireland. Those organisations that did not support the policy change included 2 small national membership organisations and 13 smaller pharmacy chains (with less than 200 employees each) and independent providers.

In summary, the majority of medium and larger pharmacy chains, representative sector organisations and other related businesses did support removing the restriction.

Respondents did not have the opportunity to explain their position at this point of the questionnaire.

Government response on removing the legal restriction

We note that there was an overall majority of support for hub and spoke models to be available across different legal entities, from those individuals and organisations that gave a view on this question. However, we acknowledge that the majority of individuals, smaller pharmacy chains and independent pharmacies who replied to the consultation did not support the policy change, while the majority of medium and larger pharmacy chains, representative sector organisations and other related businesses did support it.

From qualitative evidence provided in later answers to other questions in the consultation, we understand the concerns and reasons given by respondents who disagreed or strongly disagreed with the proposal to remove the current restriction. For example, comments included that there was no need for the proposal, that the community pharmacy network would be undermined, that the benefits set out would not be realised and that there could be patient safety risks. We believe that we have taken appropriate action to address these concerns and have provided mitigations in our policy proposals and proposed legislative amendments to ensure patient safety, transparency and accountability, as explained below in the government response on these issues provided in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’.

Therefore, we intend to proceed to implement the necessary changes to medicines legislation to remove the current restrictions that prevent the hub and spoke dispensing models from operating across different legal entities found in section 10 of the Medicines Act 1968.

On sufficient flexibility with the proposed models

We asked respondents to indicate the extent to which they agreed or disagreed that the 2 proposed models, spoke-to-hub-to-spoke-to-patient (model 1) and spoke-to-hub-to-patient (model 2), provided sufficient flexibility.

Summary of responses

Overall, more respondents thought that the proposals did not provide enough flexibility. Seventeen respondents did not agree or disagree. Of the remainder:

• 40% felt that there was sufficient flexibility - 20% (22) strongly agreed and 20% (23) agreed
• 60% disagreed that there was sufficient flexibility - 44% (50) strongly disagreed and 16% (18) disagreed

The level of agreement with the statement was the same for organisations and individuals. A higher proportion of individuals stated that they strongly disagreed with the statement (46% of individuals and 28% of organisations) while a higher proportion of organisations chose not to give a view on the question (18% of organisations and 7% of individuals).

Of the 40% of respondents who felt that the 2 proposed models offered sufficient flexibility, comments included the following:

• no further models were required as the 2 models proposed would enable a level playing field and would cover a full range of hub and spoke dispensing (9 views)
• model 2 might be preferable for some patients who would prefer their medication to be posted or are already having the spoke deliver to their home

Of the 60% of respondents who felt that the 2 proposed models did not offer sufficient flexibility:

• 6 respondents disagreed with any expansion of hub and spoke into community pharmacy as they felt that this could undermine the community pharmacy network and lead to reduced staffing levels, without delivering patient benefits. Risks to patient safety and potential delays in receiving medication were also cited as reasons
• 5 respondents were happy with model 1 but did not support model 2, for reasons outlined below
• 3 organisations shared their concerns about the uniqueness of the Northern Ireland context, including whether article 40 of the EU Medicines Directive 2001/83 would override the proposed amendments to the HMRs. While model 1 was supported in principle, one organisation suggested that model 2 might be incompatible with the Health and Personal Social Services (Northern Ireland) Order 1972, Northern Ireland’s Pharmaceutical Services Regulations

Three organisations which neither agreed nor disagreed with the statement on sufficient flexibility stated that they did not support model 2, for reasons stated below, and one advised caution before proceeding with this model.

The reasons given by respondents for not supporting model 2 were:

• it could disrupt the patient relationship with the spoke, because the patient would not need to visit the pharmacy or dispensing doctor to receive their medicine and ask any questions about it. This could introduce new patient safety risks
• it undermines the intentions of various strategies to have patients visit pharmacies as a first port of call, particularly for NHS-commissioned services such as Common Ailments in Wales, Choose Pharmacy in Wales, Pharmacy First in Scotland and the Community Pharmacist Consultation Service in England (which has now become part of Pharmacy First)
• it blurs the line between physical pharmacies and DSPs, which have clear requirements within current regulations in England
• it could undermine current control of entry requirements, as hubs would not have to be on the NHS pharmaceutical list
• it could be disruptive to remuneration models
• it could undermine the viability of the local community pharmacy network and therefore risk losing all the additional advantages of this aspect of NHS service to patients

More consultation evidence on patient safety, competition, market entry and renumeration is given below in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’. All the above themes were repeated throughout the consultation evidence under a range of questions but have not been reflected everywhere in this report, to avoid duplication.

Government response on sufficient flexibility with the proposed models

While the majority of respondents felt that the 2 proposed models did not provide sufficient flexibility, reasons for the negative response were split between general opposition to any kind of hub and spoke model, opposition specifically to model 2 and particular queries about the application of the policy in Northern Ireland within the context of the Northern Ireland Protocol at that time (which was before the Windsor Framework was agreed).

On the latter point about the applicability of the policy in Northern Ireland, our intention is to expand the hub and spoke models throughout the UK. While some respondents raised concerns about whether the policy could legally be extended to Northern Ireland, the context of this has changed since the consultation was held and there was nothing in the responses provided that leads us to think that there are material differences about the context of Northern Ireland which means that the policy should not be implemented there, or in any other devolved administration. The consultation was held before the Windsor Framework was agreed on 23 February 2023. The Windsor Framework included an unprecedented settlement on human medicines and ensures that patients in Northern Ireland will get the same medicines, on the same basis, as patients in Great Britain, when it comes into force. It also disapplies the EU’s Falsified Medicines Directive. The issues raised by stakeholders should therefore no longer apply.

We appreciate the concerns shared in particular surrounding model 2. However, we note that there were comments in support of model 2. We have sought to address the concerns as far as possible in the proposed legislative amendments and advise that other matters outside the scope of the HMRs (for example, market entry concerns about model 2) will need to be considered further in conjunction with the national community pharmacy representative bodies in each administration, in order to determine if amendments to other secondary legislation are appropriate, such as the PLPS regulations in England and the equivalent in the devolved administrations. Therefore, we are assured that together, both the proposed models do provide sufficient flexibility.

See section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’ for more evidence and the government response to the issues raised regarding patient safety, competition, market entry and renumeration.

As the amendments proposed are enabling, it is not compulsory for pharmacists to use either or both hub and spoke models if they do not wish to. Model 2 was included so as to not stifle innovation and could also be useful where the spoke pharmacies or dispensing doctors are already offering a delivery service to patients - in these cases, it would be quicker for the patient to receive their medication directly from the hub rather than for the hub to send it back to the spoke and then for the spoke to deliver it to the patient.  

Any other hub and spoke models

We asked respondents whether there are any further hub and spoke models which should be considered.

Summary of responses

One respondent suggested that electronic transfer of prescriptions and use of patient apps might drive variations in the models described, for example:

• hubs delivering direct to secure lockers for collection, which might or might not be on pharmacy premises
• co-assembly hubs might spring up which specialise in difficult prescriptions such as controlled drugs so more than one hub might be engaged in assembling prescriptions (in the way that appliance contractors currently specialise). In this case the main hub might transfer part of the prescription to a secondary hub
• business interruption hubs - if the regular hub fails because it is too expensive to maintain a back-up redundant system, there might be contractual arrangements in place for a secondary hub to be used, in which case the original hub might transfer the whole prescription to that secondary hub

Five respondents mentioned other models which were not hub and spoke, including ‘Golden Tote’ and ‘Pick to Tote’, where a wholesaler supplies pharmacies (or a dispensing doctor) with medicines selected for a particular patient in one box (or tote), so that the pharmacy has the patient’s prescription items contained in one place to dispense. It was suggested that this is a more cost-effective solution and is easier to implement, without the legal or operational complications of a fully automated hub. This model already exists and is not equivalent to the hub and spoke policy between different legal entities for a number of reasons. The wholesaler is not a retail pharmacy and the hub and spoke policy seeks to connect only registered retail pharmacies in a new partnership (or a dispensing doctor). The medicine contained within the box or tote for each patient is not labelled for that patient - this assembly is done at the retail pharmacy which receives the box or tote.

Other models mentioned were:

• robotic dispensing on site within the pharmacy
• the use of hospital robots to dispense primary care prescriptions overnight or during the day depending on their capacity, across a neighbourhood or system
• other options should be developed to accommodate the needs of the growing care home sector (but these were not described)

Government response on any other hub and spoke models

Suggested adaptions of the proposed hub and spoke models and alternatives were proposed. Having considered the responses, we are of the view that there are no strong arguments made or suggestions for different models of hub and spoke that require further changes to primary or reserved legislation that we support. The proposed legislative changes that we intend to make, to enable the hub and spoke models, will also enable one of the suggested alternatives, namely that a hospital pharmacy which is a registered pharmacy could provide hub services for spokes in the community. Our intention therefore, is to proceed with the implementation of the 2 models of hub and spoke that we consulted on.

5. Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors

Mandating arrangements to be in place between the hub and the spoke

We asked respondents to what extent did they agree or disagree that the HMRs should mandate that arrangements are put in place between the hub and the spoke to ensure accountability.

Summary of responses

Overall, there was strong support for this proposal. Thirteen respondents did not agree or disagree. Of the remainder:

• 75% supported the proposal - 49% (58) strongly agreed and 26% (31) agreed
• 25% disagreed with the proposal - 16% (18) strongly disagreed and 9% (11) disagreed

There was no significant difference in the strength of feeling between organisations and individuals.

Sixty-three respondents did not comment further other than to indicate their preference.

Out of the respondents who provided a further comment, 23 respondents preferred that the details were agreed between the hub and the spoke because they felt that there was no need to be overly prescriptive about the specifics of the arrangements in legislation. There was a view that setting out the responsibilities in legislation would risk stifling innovation.

Fourteen respondents stated that the required content of the arrangements should be determined centrally. They argued that the position to allow maximum flexibility was too vague and that the details should be set out in legislation, or that there should be a mandatory national template for arrangements between hubs and spokes. Two respondents called for clear guidance to be issued - one asked for clearly defined roles and responsibilities to be outlined in legislation and one asked for a national template to be used.

Eighteen respondents used this opportunity to express their view around topics such as accountability of the hub and the spoke but did not indicate their position regarding mandating the content of the arrangements as consulted on.

Where respondents preferred the nature of the arrangements to be mandated, their responses either raised questions about or discussed the division of responsibility between the hub and the spoke. Opinion was split, with 5 responses arguing that the hub should be fully responsible for the process whereas 4 felt that both should take equal responsibility and that no single entity could be solely accountable. Three raised questions around the responsibility and accountability of the hub and spoke and how they would be upheld in regulations. Two respondents provided suggestions for who should have accountability in various occasions - one stated that the responsibility for the final check should be with the pharmacist who is bagging the medicine. The other stated that the hub should be responsible for the accuracy of the items, and the spoke should be responsible for the clinical checks.

One respondent commented specifically on liability, stating that the issue of how professional and clinical liabilities are shared between hubs and spokes is vital and that clear professional and regulatory guidance is absolutely necessary in order to maintain the levels of trust between third parties that will be required for full operations.

Other comments were made about the drafting of the legislative changes in relation to mandating arrangements, including that the arrangements should be written down. For detail of this, see section 6, ‘Drafting of the amendments to the Medicines Act 1968 and the HMRs’.

Government response on mandating arrangements to be in place between the hub and the spoke

We are pleased that the majority agree with our view that any proposed regulations should mandate that arrangements are in place between the hub and the spoke. Having considered the comments from respondents, we intend to mandate in the proposed draft regulations that there must be written arrangements in place between the hub and the spoke and that those arrangements must include a comprehensive statement setting out the responsibilities of both the hub and the spoke in relation to any orders received pursuant to those arrangements. We think this is one of the key pillars to ensure that there is accountability so the supply of medicines through hub and spoke arrangements is safe and effective.

While we believe that the responsibilities of the parties should be set out in the written arrangements, we also support the majority view, with the exception of the labelling of medicines (for more details, see ‘Labelling of medicine’ in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’), that it is not necessary or appropriate to place any further stipulations on the nature of those arrangements, or to provide a template in the legislation for them as we do not wish to stifle innovation and feel that allowing flexibility will ensure that organisations wishing to enter into new hub and spoke arrangements can decide between themselves which business takes responsibility for what.   

We envisage that member organisations or insurers will want to support their members or clients and may well provide template written arrangements that pharmacies could adopt or amend to suit their individual needs. In recognition of the value of the information shared about what could be included in hub and spoke arrangements, we have summarised respondent views on the contents of the written arrangements between hub and spoke at Annex C, below.

Pharmacy owners will need to consider how and from whom to obtain appropriate advice, mindful of the fact that they cannot contract out of their accountabilities under the relevant standards for registered pharmacies in their territory.

Within the proposed regulations, we intend to include a sanction if pharmacies working in hub and spoke arrangements fail to put written arrangements in place - this sanction is explained at ‘Comments provided on data protection’ in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’.

Display of a prominent notice

We asked respondents to what extent did they agree or disagree that the HMRs should ensure that pharmacies utilising hub and spoke models must display a prominent notice to inform patients that hub and spoke models are being used, as well as the name and address of any hubs being used.

Summary of responses

Overall, there was very strong support for this proposal. Twenty-one respondents did not express their agreement or disagreement. Of the remainder:

• 81% agreed with this proposal - 53% (58) strongly agreed and 28% (31) agreed
• 19% disagreed with this proposal - 13% (14) strongly disagreed and 6% (7) disagreed

Individuals agreed more strongly than organisations about the importance of this proposal (with 58% of individuals showing strong agreement and 46% of organisations). Otherwise, the strength of feeling about this proposal was similar across all responses.

Fifty-two respondents did not provide any further comments other than to give their view above.

A number of key themes emerged from the comments of the remaining respondents, notably the importance of patient choice, transparency and accountability. Fifty-two respondents recognised that patients are entitled to know who is involved in the dispensing of their medicines, to be able to make an informed choice about where they present their prescription. One organisation commented that the display of a prominent notice would build on the current precedent for the use of such notices to provide information to patients and the public, such as who is the responsible pharmacist on duty in the pharmacy that day. While a small number of respondents noted that some patients might prefer to use a pharmacy where hub and spoke models were not in operation, others argued that patients would not mind, and this would add little value.

On patient choice, 4 respondents felt that there needed to be a level of explicit informed patient consent beyond a notice - for example, the pharmacist explaining to the patient that they are utilising a hub, either to bring the opt-out process into sharper focus or to gain explicit opt-in permission. However, the majority of respondents saw this approach as unnecessary, instead suggesting that the notice would be sufficient, and patients would still be able to opt out if they chose to do so. The notice would also provide an opportunity for the patient to ask for more information if they were interested or concerned.

Sixteen respondents noted the link to accountability and how patients need to be aware of where the professional responsibility lies regarding their prescription.

Two respondents commented that where one party to the hub and spoke model was a DSP, information should be prominently displayed on that pharmacy’s website to explain how it was involved in hub and spoke models.

Eight respondents viewed the notices as unnecessary, suggesting that patients may find it confusing.

Government response on display of a prominent notice

We recognise the importance of patient choice and understand that patients will want to know how to raise an issue and with whom, alongside understanding what is happening to their prescription and their patient data. This is why we are pleased that the majority agree with our view that a notice should be prominently displayed in the spoke pharmacy or dispensing doctor’s GP practice - therefore, we intend that the proposed draft regulations will include a requirement that such a notice must be displayed conspicuously at the premises of the spoke. That notice must include the name and address of any other parties with whom they have entered into a hub and spoke model with a brief statement about the general effect of their arrangements.

For DSPs and all pharmacies or dispensing doctors who have an online presence and operate hub and spoke, we agree that this same notice should be placed on their website and the proposed draft regulations will provide this.

As above, we intend to include a sanction if pharmacies working under the hub and spoke arrangements fail to display this notice conspicuously or at all - this sanction is explained at ‘Comments provided on data protection’ in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’.

For our response on dispensing doctors acting as a spoke and displaying a notice, see ‘Access for dispensing doctors to hub and spoke’ in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’.

Labelling of medicine

We asked respondents to what extent did they agree or disagree that we allow flexibility for the label to carry the name and address of either the hub or the spoke, depending on what the agreed arrangements were.

Summary of responses

Overall, there was more support for not allowing flexibility on labelling. Twenty-three respondents did not agree or disagree with the proposal. Of the remainder:

• 46% supported the proposal to allow flexibility, so that the label could carry either the hub or spoke’s name and address - 25% (27) strongly agreed and 21% (23) agreed
• 54% disagreed (29) that we should allow flexibility and preferred that we determine which name and address should be on the label

There was no significant difference between the views of organisations and individuals responding.

The majority of responses to this question focused on whether it should be the hub or spoke’s name and address which should be included on the label, with 3 main views emerging:

a) the label should contain the name and address of the spoke

b) the label should carry the name and address of both the hub and the spoke

c) the label should contain the name and address of the hub

Below we provide more detail on those 3 views.

Nineteen respondents thought that the label should contain the name and address of the spoke. Respondents pointed out how it is still important for the spoke to have the relationship with the patient and remain the point of contact. Four respondents thought the spoke should definitely be listed on the label but recognised there were opportunities where naming the hub would be helpful too.

Sixteen respondents thought that the label should carry the name and address of both the hub and the spoke. Respondents explained how this would be important for patient clarity (2 respondents) and transparency (one respondent), with others highlighting how it is important for accountability (2 respondents), especially as both hub and spoke hold responsibility. Two respondents suggested having the following on the label: ‘Assembled by X (hub) on behalf of Y (spoke)’. One suggested that a smaller, less prominent mention of the hub could also be included to help facilitate transparency. One responded that the spoke’s details should be on the medicine and the hub’s details should be on the bag as it services many different spokes and it may not be feasible to print multiple different labels.

Two respondents thought that the hub name and address should be on the label, as they believed the responsibility should be with the hub in the event of any queries.

In addition, 2 respondents commented that the name and address printed on the label should vary by the different model used. For model 1, where the spoke supplies the medicine to the patient, the details of the spoke should be printed. For model 2, where the hub supplies the medicine to the patient, the details of the hub should be printed.

There were 15 respondents who commented on the importance of flexibility. For example, that it is appropriate to allow some element of flexibility provided it is clear to the patient who is the appropriate party to contact in the event of a query. One commented on how there should be the ability for either the hub or the spoke to be on the label if this was clearly outlined in written arrangements between the 2, but not both. One commented that while there should be flexibility for the parties involved to decide between the hub and the spoke, the label should represent the point of contact for the patient.

Given the mixed views from the questionnaire on this subject, we held a workshop in December 2022 to provide a further opportunity for representatives of interested groups to discuss the proposed changes. Highlighting some of the areas from the questionnaire responses, the importance of the spoke’s relationship was argued as a strong reason as to why the spoke should be on the label. Others noted the importance of flexibility, for example if the hub is sending medicines directly to the patient under model 2, it may make more sense for the hub to be on the label. Some suggested there should be an audit trail between the spoke and the hub, but that this should be achieved through a code on the label representing the second pharmacy involved in the dispensing, as 2 addresses may be confusing.

Government response on labelling of medicine

The government recognises the importance of the patient being clear about who to talk to about any queries in relation to their medication. There was a mixed response to the question asked in the consultation on this issue - because of the lack of agreement on which party should be named, combined with a clear message that naming both would cause confusion, we intend to provide flexibility for the spoke or the hub to be named on the label, but not both. We also intend that the proposed draft regulations will mandate that the hub and the spoke must state within their written arrangements whose name and contact details will be provided on the dispensing label, as the first point of contact for patient queries for the dispensed medicine. Our intention is that these labelling requirements will apply for dispensing doctors as well.

Access for dispensing doctors to hub and spoke

We asked respondents whether they had any views on the proposed enablement of hub and spoke models for dispensing doctors.

Summary of responses

Sixty-five respondents did not agree or disagree with the proposal, although 24 gave a comment about it. There was strong support from the remainder:

• 78% (21 organisations and 14 individuals) agreed that dispensing doctors should be able to act as a spoke in hub and spoke models
• 12% (2 organisations and 8 individuals) disagreed with enabling this option to dispensing doctors

Those respondents who agreed with the proposal felt that this provided equity for dispensing doctors and they hoped that access to automation in hubs would provide the same benefits in reduced dispensing errors. Patient safety could be increased because there is no pharmacist involvement when dispensing doctors supply medication - under hub and spoke models, there would also be a pharmacist involved in the process. It could also reduce workload for GP practices in remote or rural locations and give them and their staff more patient-facing time.

Respondents who objected to this proposal did so because they disagreed with the hub and spoke policy in principle.

Other comments included:

• if dispensing doctors are enabled, they should be operating under the same standards as community pharmacists and be providing pharmaceutical services under a common regulatory framework, for alignment and consistency
• there are different regulatory bodies for dispensing doctors and registered pharmacies. For example, in England, the Care Quality Commission (CQC) regulates dispensing doctors and the General Pharmaceutical Council (GPhC) regulates registered pharmacies. Therefore it is important that there is consistency and effective communication across and between these regulators
• dispensing doctors should be allowed to access model 1 but not model 2 (as the respondent disagreed with that model)
• allowing dispensing doctors to act as a spoke would undermine the need to maintain a full dispensing service in rural areas if some dispensing activities are carried out at another and potentially non-rural premises
• training requirements for dispensing doctors are voluntary so there is no guarantee that dispensing doctors would be able to cope with the additional demands of hub and spoke dispensing
• legislation should prevent the dispensing doctor setting up a DSP operation through their GP practice
• legislation should make clear that there must not be any conflicts of interest between medical practices acting as spokes and companies providing dispensing hubs
• hub and spoke models may not be viable for dispensing doctors due to their generally smaller volume of dispensing work and low levels of electronic prescription service (EPS) utilisation
• the impact of hub and spoke on the financial viability of small rural dispensaries, and in turn the branch surgeries they may support, needs to be carefully considered

We also asked respondents to what extent did they agree or disagree that dispensing doctors must also display a prominent notice to inform patients that hub and spoke models are being used, as well as the name and address of any hubs being used. There was very strong support for this proposal. Twenty-seven respondents did not agree or disagree. Of the remainder:

• 90% (42 organisations and 52 individuals) agreed
• 10% (3 organisations and 7 individuals) disagreed

There was no significant difference between the views of organisations and individuals responding.

Government response on access for dispensing doctors to hub and spoke

We acknowledge the strong support for dispensing doctors being able to access hub and spoke models, so we intend to enable dispensing doctors to be able to act as a spoke. We confirm that under the proposals, dispensing doctors will not be able to operate as a hub.

We note the concern that dispensing doctors accessing a hub and spoke arrangement, specifically model 2, may undermine the provision of a full dispensing service in rural areas and the market entry arrangements. In our opinion, this matter is outside the scope of the HMRs. Therefore, it will be for each administration to determine, with the respective representative bodies, how to implement the hub and spoke arrangements within the provision of their respective NHS pharmaceutical services.

On end-to-end regulatory oversight of the hub and spoke models when dispensing doctors act as a spoke, different regulators have responsibility for regulating dispensing doctors. In England the regulators for the NHS practice or premises of dispensing doctors are CQC and in Wales it is the Health Inspectorate Wales. Where the concerns extend to pharmacists or pharmacies, CQC and GPhC have confirmed they will share information when regulating these services under their memorandum of understanding and information sharing agreements. Health Inspectorate Wales will take a similar approach with GPhC. There is no equivalent regulator in Scotland and Northern Ireland for the NHS GP practice or premises of dispensing doctors. The Northern Ireland Department of Health will consider how to ensure the equivalent regulatory oversight for end-to-end hub and spoke models if dispensing doctors act a spoke, when it comes to implementing this policy in Northern Ireland, including any legislative measures. The Scottish Government will ensure the end-to-end governance of hub and spoke arrangements, if dispensing doctors act as a spoke, by giving advice to health boards about hub and spoke arrangements and how this impacts their governance responsibilities when they commission services from dispensing doctors who form a spoke.

To ensure that the noticing requirement would be placed on dispensing doctors in addition to retail pharmacies, we intend to amend the draft legislative amendments so that the requirement will sit within the HMRs as opposed to the Medicines Act 1968, as suggested by some respondents to the consultation.

Also as above, we intend to include a sanction if dispensing doctors working in hub and spoke arrangements fail to display this notice conspicuously - this sanction is explained at ‘Comments provided on data protection’ in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’.

Patient safety of hub and spoke operations

We asked respondents whether they thought that the proposals raised any issues regarding patient safety.

Summary of responses

Overall, the majority felt that the proposals did raise issues with regard to patient safety. Fourteen respondents did not agree or disagree. Of the remainder:

• 80% of respondents (42 organisations and 52 individuals) agreed that the proposals raised issues regarding patient safety. There were 79 detailed replies to explain this position
• 20% of respondents (11 organisations and 12 individuals) did not think that the proposals raised patient safety issues. There were 16 detailed replies about this position

There was no significant difference between organisations and individuals on split of opinion.

Nine respondents who did not express their agreement or disagreement nevertheless provided a comment.

Five individuals and 16 organisations felt that patient safety would be at least as good as existing standards or would be improved by hub and spoke dispensing, as long as appropriate processes were in place, as this was already being experienced by businesses which used this model already or which used automation in some way.

Other comments were:

• technology and automation are more reliable than humans when used correctly
• according to research published by the Journal of Pharmaceutical Policy and Practice, the use of automated dispensing could enable improved oversight and tracking of medicine use in real-time. This data can be used to develop and evaluate interventions to improve medication adherence, thus leading to improved health outcomes for individuals, reduced medicines wastage and healthcare cost
• if pharmacy teams gain more time to explain medications to patients, this could increase compliance and prevent complications

Caveats to these positive views on the likely impact on patient safety are that:

• experience of reduced errors from automation is based on current systems where there is only one legal entity, so this may not be comparable to the new proposed situation, and published research on the evidence of reduced errors from automation is based on dispensing in hospitals using robots rather than in community pharmacy
• an international literature review on hub and spoke was carried out by one organisation in 2018 - at that time, this review did not find conclusive research evidence of increased patient safety due to automation
• one individual commented that they had personal experience of hub and spoke dispensing where the dispensing error rate had increased

Of the remaining replies from respondents who thought that there were issues to be considered, there was a wide range of comments concerning the different ways in which patient safety might be compromised, as follows:

• the more points in the dispensing chain, the more potential for error
• a lack of understanding about roles, responsibilities and accountability could make errors more likely, especially if the arrangements might not be legally binding - supervision arrangements and liability would need to be clearly defined
• there is a risk of initial errors and new types of errors with the introduction and adoption of any new operating processes. Significant investment would be required in quality assurance to identify any teething problems and address them. Transparency across the whole process is vital
• data errors could still occur at the hub and even though rare, would have a greater impact on a larger number of people - for example, information in a barcode being interpreted differently in the hub and spoke IT systems. The pressure to cut costs may lead to insufficient checking mechanisms in the hubs to ensure self-validation and correction, so impacting on patient safety
• the existing GPhC inspection model would not be fit for purpose in a hub inspection so would need to be revised to pick up potential patient safety risks. One respondent noted that GPhC has not published full inspection reports of existing hubs for over 10 years
• the onward cascade of safety warnings and drug recalls could be more difficult within a hub and spoke model

Respondents commented specifically that, in relation to model 2, there could be increased patient safety risks due to:

• more limited opportunity for pharmacists to give patients advice on how to take their medication correctly
• problems with business continuity issues in the hub such as operational and logistical problems (for example, caused by adverse weather) could result in patients being signposted to brick-and-mortar pharmacies. Two documented national incidents (one in December 2015 involving a DSP and one in May 2014 involving a pharmacy servicing many care homes) highlight the unintended consequences
• increased difficulty for the patient to manage their medications if the spoke uses more than one hub for different elements of the prescription, as this might result in separate medications arriving at the patient’s home on different days
• if pharmacy technicians at spokes are doing less dispensing, they could become de-skilled in relation to accuracy checking
• if the number of pharmacy spokes declines overall as a result of this policy, patients would have reduced access to immediately necessary treatments like antibiotics, steroids, analgesics and insulin
• if hub and spoke causes staffing to reduce in spoke pharmacies, the higher proportion of more complex prescribing at the spoke combined with workforce pressure might lead to more safety incidents

Respondents suggested ways to mitigate patient safety risks, which were:

• arrangements for accountability and governance need to be clear to everyone through a service level agreement
• appropriate processes needed to be in place and followed
• patients must know who to contact about any queries
• if the patient preferred direct supply from the hub, then the pharmacy receiving the prescription should ensure that issues normally flagged at the point of dispensing were communicated at the point of presentation. Linked to this, there could be triggers within the process to require the patient to interact with a pharmacist about their medicine at certain times (for example stopping, starting or change in dosage, high risk medicine, or a change in the person’s condition)
• the hubs and spokes should develop robust business continuity plans to the event of process problems
• the regulatory bodies should have oversight and scrutiny of new arrangements and governance of professional standards
• there should be mechanisms in place to ensure that the patient’s medication record is updated to reflect all medication supplied, however many suppliers are involved

Government response on patient safety of hub and spoke operations

The government recognises that the implementation of hub and spoke introduces new risks, just as any change or new process carries risk. While recognising the caveats, we heard that a proportion of both individuals and organisations felt that patient safety would be at least as good or would be improved by hub and spoke dispensing, as long as appropriate arrangements and processes were in place. We have seen evidence that, while error rates in community pharmacy are already very low, the error rates using automation can be even lower, with the right arrangements in place. In addition, we received evidence from respondents to suggest that there can be calmer, more focused, working environments in both the hub and spoke - for example, staff working in the hub are likely to face fewer disruptions to the dispensing processes that they are responsible for and so are less likely to make errors. At the spokes, staff have more time to deal with complex issues and patient-facing work, so are less likely to make errors. Further, having more time to explain medications to patients could increase compliance.

We do recognise, however, that any change to standard processes could lead to patient safety risks so it will be important for pharmacies and dispensing doctors adopting hub and spoke models to take steps to mitigate any risks during the transition period. The mandatory written arrangements that we intend to put in place between the hub and spoke is one of the mechanisms by which we expect that the different parties will mitigate against risks that could arise due to a lack of understanding about roles, responsibilities and accountabilities. We would also expect that hubs and spokes would put in place robust assurance processes and feedback mechanisms to ensure that any weakness in the arrangements are flagged and addressed. There could be many ways to start the new hub and spoke models, such as piloting, trialling, or starting with a small number of prescriptions or only certain types of prescriptions, until the processes across the 2 premises are proven to operate successfully and are fully embedded.

We note the concern among respondents that adopting the hub and spoke models will incur additional steps to the current dispensing process and that parts of the dispensing process will be supervised by different pharmacists on different sites, and that this could introduce points of error. However, existing hub and spoke models that operate now within the same legal entity have different pharmacists on different sites and are managing this risk through their operational processes. We consider that each pharmacist has a professional responsibility to maintain the standards and duties imposed by the relevant regulator. They also have a professional accountability for their own actions and the actions of anyone who they are supervising. They will be responsible and accountable for the parts of the dispensing process that they either carry out themselves or are supervising others to do, and, if they are the responsible pharmacist, they will remain responsible for securing the safe and effective running of the premises. 

We appreciate that there are different issues to consider when thinking about patient safety issues where a dispensing doctor acts as a spoke. While there will not be a responsible pharmacist at a dispensing GP practice, the mandatory written arrangements between this type of spoke and the hub, that we intend to mandate, will still need to outline the responsibilities of each party. A doctor, in the same way as a pharmacist, is bound by the standards and duties imposed by their regulator, the General Medical Council (GMC), and will also have a professional responsibility and accountability for their own actions.

On regulation of hub pharmacies, we note that some consultation responses suggested that regulators should develop new standards and processes to ensure the effective regulation of hub pharmacies. However, regulation of hub pharmacies is not a new issue as hub pharmacies that operate within the same legal entity exist already and are subject to professional regulation by GPhC in Great Britain and the Pharmaceutical Society of Northern Ireland (PSNI) in Northern Ireland. For this reason, we agree with the view of respondents who feel that there is no need to change the current regulatory system in relation to pharmacies - GPhC have the relevant responsibilities to inspect all pharmacy premises and already have appropriate standards, inspection processes and regulatory powers in relation to registered pharmacy premises in Great Britain. Hubs that are Great Britain pharmacies will need to be registered with GPhC and will be liable to be inspected by them. However, GPhC inspectors will not undertake a legal review of the contractual relationship between a hub and its spokes. In Northern Ireland, the Medicines Regulatory Group (which is part of the Department of Health) have powers to inspect pharmacies against published standards. PSNI have the ability to take regulatory action to address individual conduct issues for registered pharmacists raised in relation to fitness to practice.

For details of how regulatory oversight of hub and spoke models will be guaranteed when dispensing doctors act as a spoke, see ‘Access for dispensing doctors to hub and spoke’ in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’.

Storage, distribution and transportation of medicines

While potentially outside the scope of the regulatory changes being proposed in this consultation, we asked respondents whether there was anything else we should consider with regards to the storage, distribution and transportation of medicines in respect to removing the current impediment in medicines legislation around hub and spoke models.

Summary of responses

Of those who responded:

• 53% (44 individuals and 25 organisations) did not provide any comment
• 44% (23 individuals and 35 organisations) provided comments about storage, distribution and transportation of medicines

An overview of the comments follows.

Fourteen respondents mentioned the need for the supply of fridge items, special items and controlled drugs to be stored and transported under special conditions. In particular, there were concerns about the delivery of medicines to patients - for example, in model 2, if the hub delivers direct to the patient, risks include ensuring medicines are delivered to the correct person and, where applicable, that a cold chain is maintained. The pharmacy or their courier must be able to demonstrate quality assurance in this regard. Currently, there is a lack of control on temperature monitoring for items delivered by post. The very nature of the postal system means items can be delayed in transit and remain in packaging longer than the intended duration, thereby risking the stability of the medicine and the patient’s health as a consequence.

Five respondents commented that operating a model 2 option will be counterproductive against the NHS net zero ambitions because it will result in more packages being transported and so increase the emissions produced overall within the medicines supply chain.

Three respondents suggested that there were no additional issues because GPhC has the power to inspect premises and already has adequate regulatory powers in relation to registered pharmacy premises. GPhC also has the ability to enforce professional standards and these standards already cover storage, distribution and transportation.

Three respondents suggested that MHRA Good Distribution Practice (GDP) requirements should apply throughout the supply chain for hub and spoke. GDP currently mandates the storage, distribution and transportation of products to ‘labelled conditions’, which is not proposed for the pharmacy environment in which ‘hub and spoke’ would operate. Licensed wholesaler distributors have invested considerable financial capital over many years in warehouse and fleet operations, facilities, IT systems and the training of colleagues to ensure GDP compliance, which is regularly inspected by MHRA. It was suggested that an increase in hub-to-spoke and/or hub-to-patient deliveries could, over time, result in large volumes of medicines being distributed outside normal GDP-compliant channels, which would not be in the best interests of the development of a competitive medicines supply chain. Hubs should be required to hold wholesale dealer licences. One respondent suggested that it would not be possible for hub and spoke pharmacies to meet MHRA standards unless the MHRA regulations were changed, especially temperature and storage requirements.

Some respondents suggest that when hubs are purchasing medicines, they should be under the same GDP requirements to verify their suppliers, in order to maintain the security of the supply chain, to reduce the risk of illegal products from being introduced into the supply chain and to ensure continuity of supply.

It was also suggested that a hub pharmacy could become a large warehouse where medicines are stored in bulk - this warehouse type would not be subject to the same GDP controls as those imposed on warehouses run by wholesalers. Over time, there might not be a competitive level playing field for medicines storage and handling. With this regulatory divergence, potentially a ‘hub pharmacy warehouse’ regulated by GPhC, and not MHRA, could expand further with manufacturers delivering directly into this hub. This might, over time, create a parallel distribution model which is regulated differently (but doing the same thing) and impacting on the longer-term competitiveness of MHRA wholesale dealer authorisation (WDA(H)) holders, who have to adhere to more onerous GDP regulations.

Further comments suggested:

• contingency planning will be needed by the hub under model 2 for delivery and redelivery of medicines if, for example, the patient is not at home, drivers get lost, vans break down or cool vans are not working properly
• the minimum standard for delivery should be a signed-for service
• it will be important to ensure secure tamper proof packaging is made up so that prescriptions are suitable for transportation
• logistical capacity within the delivery mode of transport may need to be reviewed as completed medication packages are very space consuming
• with secure transportation between hub and spoke, one respondent suggested that hub pharmacies could be allowed to dispense and transport schedule 3 controlled drugs
• hub and spoke processes will mean it takes longer to supply medication to patients - this is already happening with DSPs
• patients may want to have a prescription tracking facility

Below are the main comments received regarding cross-boundary matters.

It was pointed out that in the event of shortages of medicines, arrangements often apply where stock will be diverted to a particular part of the UK. In other cases, governments hold stockpiles of medicines for their local populations. These arrangements could be adversely affected by any flow of medicines between the hub and spoke, especially where the hub is in another area or another country.

Four respondents suggested that Northern Ireland’s unique geographic, economic and logistical factors will impact on the storage, distribution and transport of medicines in respect of hub and spoke dispensing in Northern Ireland. This is coupled with a complex regulatory environment unique among the countries of the UK as a result of the UK’s Trade and Cooperation Agreement with the EU and the Protocol on Northern Ireland (which was in place at the time of the consultation). Northern Ireland was also subject to the Falsified Medicines Directive at the time of the consultation - respondents commented that this has added extra steps into the supply of medicines and so this additional level of safety would need to be taken into account in any new regulations. It was suggested that where hubs and spokes were connected across Great Britain and Northern Ireland, patient safety and reliability of medicines should not be compromised and contingency plans should be put in place to mitigate any risks. One respondent felt that medicines for Northern Ireland patients should only be labelled and distributed from pharmacies in Northern Ireland, not posted from mainland Great Britain, but did not give a reason for this view.

Government response on storage, distribution and transportation of medicines

On the role of regulators in relation to storage, distribution and transport, we acknowledge the importance of quality assurance to protect the stability and security of any prepared or assembled medicines throughout the dispensing process. This is why medicine supply is regulated end to end to ensure that medicines are stored and transported securely and maintained at the appropriate temperature - it is no different under a hub and spoke model.

In relation to the points made about quality standards and assurance for storage, distribution and transport of medicines from pharmacies, hubs or spokes (including postal), GPhC and PSNI already have regulatory standards which cover these areas and have the ability to enforce them. For this reason, we do not accept the argument that hub pharmacies should be required to meet MHRA GDP standards to assure patient safety in storage, distribution and transport by wholesalers.

Principle 4 of GPhC’s outcome-focused standards for registered pharmacies addresses issues around logistics and delivery, without providing prescriptive detail. GPhC expects pharmacy owners, in meeting those standards, to take account also of the relevant guidance issued by the regulator, including in this instance the guidance for registered pharmacies providing pharmacy services at a distance, including on the internet. Section 4.3 of that guidance, for example, sets a clear expectation that pharmacy owners should assess the suitability of chosen methods of supply, dispatch and delivery.

In relation to environmental impact, under section 17(5) of the Environment Act 2021, from 1 November 2023, ministers have a duty to have due regard to 5 environmental principles in relation to any new or revised policy. The 5 principles are integration, prevention, rectification at source, polluter pays and the precautionary principle (for further detail, see Environmental principles policy statement). It is difficult to estimate the extent and timing of the hub and spoke policy impact in relation to the environment because we do not have robust conclusions about the likely uptake of hub and spoke models and how that will affect supplies from wholesalers and deliveries to patients (as set out in section 7, ‘Impact assessment and equality considerations’).

Environmental benefits in distribution could be realised if fewer but larger deliveries (for example every week or fortnight) are made from wholesalers to hubs replacing more frequent deliveries between wholesalers and multiple dispersed spokes. While there are likely to be additional journeys between hubs and spokes to transport prepared medicines between them, they would likely be local journeys so even with these additional miles, total emissions in the supply chain could be less than under previous distribution arrangements. Age and type of vehicles involved will also be relevant. There may also be potential to reduce overall waste in the supply chain due to economies of scale and use of OPD.

Under model 2, environmental emissions could be neutral, positive or negative if the patient was already having their medication delivered to their home by the local spoke pharmacy, depending on the distance of the hub from the patient’s home compared to the local community pharmacy. If the use of model 2 leads to an increase in prescriptions being delivered, this could have a negative effect of environmental emissions.

Environmental costs in hub and spoke models may be incurred if overall emissions are greater than under previous dispensing models once all factors are taken into account. Operations at the hub (for example, if they are using automation) are likely to require more energy-intensive equipment, which therefore increases carbon emissions, should the facility not be powered by renewable energy sources.

In relation to concerns that the hub and spoke models could introduce delays into the medicine dispensing process, we acknowledge that some prescriptions, such as acute ones for pain management, antibiotics or where a patient has run out of their repeat medication, may not be suitable for the hub and spoke models. We see the hub and spoke models being of use in the main for patients who are stabilised on repeat prescriptions and so normally do not need their repeat medicines immediately. This issue of timing will be for each hub and spoke to address when they establish their operational processes - we have received anecdotal evidence that some of the existing hub and spoke models work to next day timescales.

There was a concern that hub pharmacies not on the NHS pharmaceutical list would be able to charge for delivery of medication to a patient. This is in the context of providing an NHS service and therefore, in our opinion, is not for the HMRs but for the pharmaceutical services legislative framework. It will be for each administration to determine - with their respective community pharmacy representative bodies - whether pharmacy regulations need to be amended on this issue.

The government recognises the cross-boundary concerns. Some of the concerns respondents flagged were around issues that have since been addressed. For example, respondents believed the requirements under the old Northern Ireland Protocol (for example, the application of the Falsified Medicines Directive) would add extra burden to Northern Ireland suppliers. However, the Windsor Framework has addressed these issues by securing a UK-wide regime for the approval and supply of medicines once it is in force. This will also include the disapplication of the Falsified Medicines Directive. In relation to the view that medicines should not be posted to Northern Ireland from Great Britain, DSPs already prepare and assemble medicines in Great Britain and supply them to patients in Northern Ireland, so this is not a new development. We can confirm that the HMRs do not apply to British Overseas Territories, therefore UK pharmacies will not be able to use any hubs located there.

Supply of medicines from spoke to hub

The draft legislative changes accompanying the consultation did not allow for the supply of medicines from the spoke to the hub. We asked respondents whether they had any views on whether a possible change should be considered here.

Summary of responses

41% of respondents (51) did not express a view on this question. Of the other 80 respondents:

• 54% (27 organisations and 16 individuals) felt that the spoke should be able to provide medicine to the hub
• 46% (16 organisations and 21 individuals) felt that the spoke should not be able to provide medicine to the hub

Organisations supported the proposal more strongly than individuals.

Of the respondents who supported the proposal, 2 commented that MHRA already allow pharmacies to move small quantities of a medicine from one pharmacy to another to meet a patient’s individual needs, within the definition of provision of healthcare services. They queried whether any change was needed to enable the spoke to supply the hub with medication to make up an individual’s prescription.

Another respondent asked for the repeal of section 10(7) of the Medicines Act 1968 to be reversed, as this would allow the transfer of stock from the spoke to the hub where necessary.

Other respondents felt that the supply from spoke to hub should be allowed in circumstances where the hub does not have the stock to fulfil a specific named patient’s medication, including:

• emergencies only
• exceptional circumstances that should be specified
• where one spoke can supply the missing drug for a patient who is linked to a different spoke
• to supply controlled drugs to the patient
• to avoid patient delay
• in stock quota situations
• to avoid the patient having an owing
• to avoid wastage, for example, to enable returns of uncollected medicine or where the wrong medicine was dispensed by the hub

Other comments were:

• a spoke would not be allowed to send the medicine via Royal Mail so a different method of collection would need to be developed
• spoke to hub transfer should not be for commercial gain or advantage
• this would help to build resilience in medicines supply and mitigate against stock shortages
• there would need to be detailed consideration of how this might affect both the price and supply of medicine

Thirteen respondents who rejected the need for spokes to supply hubs commented that they opposed the entire policy of hub and spoke models. The remaining 24 respondents who did not support the proposal to allow the spoke to send medication to the hub commented as follows:

• this would be a wholesale transaction, not a pharmacy transaction
• this change could confuse legitimate recalls and returns
• this could encourage the practice of ‘skimming’ pharmacies for product
• it would be useful to change the Medicines Act 1968 to allow pharmacies to wholesale small quantities of medicine to each other, to support patient welfare
• spoke to hub supply would increase the likelihood of catastrophic error due to the number of different spokes that could all be supplying to a hub, creating greater complexity and logistical challenges for robotic dispensing with varied package sizes and expiry dates and so forth - the integrity of stock under GDP would be at risk
• it could encourage hoarding of medicine within the supply chain with the expectation of supplying one another in future
• if a hub cannot fulfil a prescription, it should send it back to the original pharmacy to be dispensed in the usual way

Given the mixed views from the questionnaire about whether we should allow spoke to hub supply, we held a workshop in December 2022 that gave representatives of interested groups the opportunity to provide views. Overall, stakeholders expressed their support for allowing spokes to provide medicines to the hub as they believed that this could be useful in exceptional circumstances, which would help to avoid delays for the patient and so would mitigate unforeseen potential needs.

Government response on supply of medicines from spoke to hub

We have considered the arguments surrounding the supply chain and processes that this additional provision would bring. We note that there was a small overall majority of respondents in favour of allowing spoke to hub supply and this view was reflected in the subsequent workshop discussion.

There were some comments that this provision is already available under MHRA guidance). However, what the MHRA guidance states is the limited circumstances under which MHRA would not enforce the legislation in relation to the requirement of holding a wholesale dealing license. In our opinion, the guidance provides that MHRA would find a movement of a small quantity of medicines between pharmacies to be a healthcare service rather than a commercial dealing provided that: (a) it takes places on an occasional basis, (b) the quantity of medicines supplied is small, (c) the supply is made on a not-for-profit basis and (d) the supply is not for onward wholesale distribution. It is our view that the movement of medicines in the hub and spoke models would fall outside of that guidance in any event. Therefore, our intention with the proposed change to the HMRs is to deem that the supply of medicines from the spoke to the hub is a new type of retail sale, so that a wholesale dealing license will not be required. As the spoke must sell or supply an assembled or part-assembled medicine in order to utilise this deemed retail sale, they will only be able to supply a medicine in the context of dispensing a prescription to a specific patient and so will not be able to move undispensed medicines. Further explanation of this new type of retail sale is given at Annex A, below.

In relation to returns, hub and spoke models will not change the current requirement for incorrect or faulty medicine to be returned to the supplier. If, for example, the spoke ordered the medicine and then sent it to the hub, which found that it was faulty, it would need to be returned to the supplier by the spoke for a refund within the required timescale.   

In relation to recalls, we would expect that the responsibility to act on recalls would be set out in the written arrangements agreed by the hub and spoke, that we intend to mandate.

In relation to the concern about hubs requesting medicinal product from spokes to stockpile or sell on (that is ‘skimming’), it will not be possible for pharmacies to sell large quantities of stock to wholesalers because any transfer of medicines from the spoke to the hub under the hub and spoke models can only be done in the context of dispensing an individual prescription to a specific patient. Under the hub and spoke models, this intended flexibility does not provide a legal basis for pharmacies to sell stock to wholesalers which may be looking to export or hoard medicines.

There was a concern that spoke to hub supply would increase the likelihood of a catastrophic error due to the number of different spokes that could all be supplying to a hub, adding greater complexity to the logistics of the operational processes. We consider that this is an operational detail which will be prevented by having appropriate procedures in place between the hub and its spokes, including standard operating procedures (SOPs). As the proposed legislative changes are enabling and therefore optional, the hub and spoke parties can agree between themselves (and indeed we would expect) that they would not make use of spoke to hub transfer of medicine until such time that they feel that they have sufficiently robust procedures in place to manage possible risks and issues.

Any other areas to consider

We asked respondents whether, in enabling the wider use of the hub and spoke models, there were any other areas that we need to consider, either in respect to the change to the HMRs and the Medicines Act 1968 or areas outside the scope of these proposed amendments.

Summary of responses

56% of respondents (51 individuals and 23 organisations) did not make any comments in response to this question. The other 47 respondents repeated points made elsewhere in the consultation questionnaire as well as giving new comments, as detailed below.

Comments provided on competition and market entry

The CMA have responsibility for carrying out investigations into mergers, markets and the regulated industries, and enforcing competition and consumer law. The CMA’s statutory duty is to promote competition, both within and outside the UK, for the benefit of consumers. The CMA, in their role as the UK’s principal competition and consumer authority, noted that the policy proposal by its nature was broadly pro-competitive, and that - as with all markets - competition, in this case between hubs, would be the key driver of lower prices, choice and innovation in the market and would be critical in supporting the policy objectives of efficiency for pharmacists. Alongside that, the CMA noted the potential longer-term competition risks, as highlighted in the department’s impact assessment. The CMA’s full response is available to read online.

Given these risks, the CMA suggested to the department a number of proposals, including that the department commit to monitoring or reviewing the implementation of the policy in relation to competition, engagement with the pharmaceutical sector as the market develops and to consider policy or regulatory levers that could alleviate barriers or encourage competition in the market.

Other comments from respondents on this topic were:

• there is a need for a dynamic and competitive hub market so that spoke pharmacies have a real choice of hubs and are not victims of hubs increasing prices once pharmacies are dependent on them
• without a competitive hub market, there could be a number of negative impacts, including reduction in patient choice, increased medicine prices due to less competition and reduced medicine supply chain resilience. For example, combined wholesaler-and-retail-pharmacy businesses might turn their wholesaler operations into hubs, leading inadvertently to a consolidation of market power in the sector amongst one or 2 operators
• the government has increased visibility of the pharmaceutical wholesale market since the introduction of legislation, Health Service Products (Provision and Disclosure of Information) Regulations 2018, which requires mandatory disclosure of information about health service medicines. Additional movement of medicines between hub and spoke may introduce an additional layer of complexity and reduced visibility of the UK medicines supply chain, which may further compromise overall transparency in the flow of medicines and consequently supply resilience
• the current system for assessing medicines margins is stable and has known touchpoints for data collection. The introduction of another set of players in the market would add complication, especially in terms of allocating margin equitably to hubs and spokes
• the government needs to consider imposing duties on pharmaceutical companies and wholesalers to supply medicines as ordered by pharmacies (spokes or hubs) without restrictions. Given that the large vertically integrated pharmacy operators (this means entities which own the wholesaler and the community pharmacy) are likely to be the primary operators of hubs, there must be provision to ensure that they do not preferentially supply their own pharmacies and restrict access to other pharmacy owners of certain medicines (especially if they are in restricted supply)
• the whole distribution system has evolved into a state of chaos with pharmacies having to send anonymised prescriptions to wholesalers or pharmaceutical companies in order for them to receive stock. If a scale up to hub dispensing is going to be viable, then there has to be some mechanism to ensure that businesses receive the medicines they need to satisfy prescriptions. This applies equally to those that make use of hubs or those that do not
• it is unclear if all hub pharmacies will be put on the NHS pharmaceutical list (that is to be able to provide NHS pharmaceutical services themselves and be paid directly by the NHS) and whether this would be an exemption to market entry rules. While the current market and landscape makes it unlikely, there is a risk that model 2 could result in a proliferation of hub pharmacies without NHS contracts, supplying direct to patients while being linked to one spoke pharmacy with an NHS contract. Under this model, hubs could charge for their prescription deliveries and wouldn’t be constrained by the same rules as DSPs. There is also a risk that one hub on the NHS pharmaceutical list could supply a proliferation of spoke pharmacies not on the NHS pharmaceutical list. To mitigate this risk, all spoke pharmacies should be obliged to be on the NHS pharmaceutical list

Government response on competition and market entry

We appreciate the importance of having a hub market that is competitive and provides pharmacies with choice. We also recognise the potential for longer-term competition risks in the supply chain if the market develops in such a way that pharmacies’ access to medicines is through an increasingly limited number of hub suppliers. If, for example, only a few larger hubs emerge, this may have a subsequent effect on the availability of medicines for patients. Therefore, in line with the recommendations from the CMA, the department commits to engaging with stakeholders to review the impact on competition once any hub and spoke market is sufficiently established, to assess if action is needed to alleviate any barriers to the development of a dynamic and competitive hub market.

It is important for the government to maintain visibility of the medicine supply chain and be able to collect data appropriately to assess costs to determine the medicines margin. We consider this outside the scope of the HMRs - devolved administrations may want to consider if amendments could be made to the NHS terms of service in each administration to ensure that the relevant bodies can access data on how medicine is moving between spokes and hubs as part of dispensing activities.

We note the concern that hub pharmacies would not have to be on the NHS pharmaceutical list and so could undermine NHS market entry arrangements. This was also raised as a concern in the 2016 consultation on the hub and spoke models. We consider that these matters are also outside the scope of the HMRs. It will be for each administration to determine - with their respective community pharmacy representative bodies - whether pharmacy regulations need to be amended to ensure that hub and spoke models do not undermine NHS market entry arrangements.

Another concern was that hubs on the NHS pharmaceutical list would be able to supply spoke pharmacies that are not on the NHS pharmaceutical list, which would also undermine market entry conditions. However, under the proposals, the order for medicinal products must always be placed at the spoke. The spoke must be a registered pharmacy or a dispensing doctor. To be able to process and dispense an NHS prescription, that spoke must be on the relevant pharmaceutical list in order to be able to provide that pharmaceutical service.

Comments provided on data protection

Two respondents specified a clear need to set out responsibility regarding the movement of patient data to ensure data protection across different legal entities, highlighting that any movement of patient data across different organisational boundaries raises risks to the integrity and confidentiality of the data. Another respondent stated that data and activity from each entity should be easily separated for audit purposes and transparency. Others asked whether spoke pharmacies, particularly independents, would be protected from ‘losing’ patients to hubs - there should be legal protection preventing the hub from using the patient data to try and set up a direct relationship with the patient for their future prescriptions.

Government response on data protection

The Data Protection Act 2018 (DPA) supplements the UK General Data Protection Regulations (UK GDPR). Everyone responsible for using personal data has to follow strict rules called ‘data protection principles’. They must make sure the information is:

• used fairly, lawfully and transparently
• used for specified, explicit purposes
• used in a way that is adequate, relevant and limited to only what is necessary
• accurate and, where necessary, kept up to date
• kept for no longer than is necessary
• handled in a way that ensures appropriate security, including protection against unlawful or unauthorised processing, access, loss, destruction or damage

There is stronger legal protection for more sensitive information, including health details - known as special category data. For the purposes of the hub and spoke arrangements, special category data will be moved between the spoke and the hub and vice versa.

We acknowledge the concerns about the need to uphold UK GDPR and the DPA in relation to the movement of patient data across different legal entities. We are clear that data needs to be managed in accordance with UK GDPR and the DPA - we are proposing, therefore, to create an information gateway within the draft regulations that makes clear that this data sharing between the hub and the spoke (and vice versa) will be seen as compliant with UK GDPR and the DPA, by setting out in legislation the lawful basis relied upon for processing this data. We also consider that this then ensures that whoever is carrying out this data sharing, for the purposes of facilitating hub and spoke, will be assured that they have overcome the barriers as to whether or not that sharing is lawful.

We are of the opinion that there are 4 elements which act as protection for the movement of personal data, including special category health data, within the hub and spoke arrangements. These are:

1. The lawful basis for processing data as provided for in the information gateway. We are relying on articles 6(1)(c) and (e) of UK GDPR. We are also relying on article 9(2)(h) of UK GDPR read alongside section 10 of and schedule 1 to the DPA as the exemption to process special category data.

2. The professional confidentiality requirement - article 9(3) of UK GDPR.

3. The professional standards and duties that apply to all registered pharmacists.

4. The written arrangements in place between the hub and spoke.

On point 1, the lawful basis for processing data - this can be found in articles 6(1)(c) and (e) of UK GDPR , namely that the processing of data must be (a) necessary for compliance with a legal obligation or (b) necessary for the performance of a task carried out in the public interest. The proposals set out that if the data being processed is related to patient health (which is a special category of data), then that processing of data must be necessary for the purposes of preventative medicine, medical diagnosis or for the provision of health care or treatment. This is so as to comply with article 9(2)(h) and section 10 of and schedule 1 to the DPA 2018. This is no different to the sharing of health data between healthcare professionals involved in the direct care of the patient. A failure to comply with data protection law could result in the Information Commissioner’s Office (ICO) taking regulatory action.

On point 2, professional confidentiality requirement - under article 9(3) of UK GDPR, any healthcare professional (and those they are responsible for) processing personal data for healthcare purposes under article 9(2)(h) does so under an obligation of professional confidentiality. We would expect that any data processed under the hub and spoke arrangements is carried out in a professional manner. In addition, as part of the information gateway provision we intend to insert into the HMRs, we are also intending to extend the professional confidentiality requirement under article 9(3) of UK GDPR, so that any person employed by the hub or the spoke who is processing the data for those purposes will also share that same obligation of professional confidentiality as the responsible healthcare professional.

On point 3, professional standards and duties - in addition to data protection legislation, all registered pharmacists are subject to professional standards and duties that are set out by the appropriate regulatory body (GPhC in Great Britain and PSNI in Northern Ireland), and to whom each individual pharmacist is accountable to for meeting those standards and duties. One of those standards relates to patient confidentiality, which would include the management, storage, use and sharing of patient information. It is the responsibility therefore, of the relevant pharmacy regulator to consider whether or not those professional duties and standards have been met by an individual pharmacist and, where necessary, are capable of taking regulatory and enforcement action against those pharmacists who fail to meet them. The GMC will provide the same function for dispensing doctors across the UK.

On point 4, the mandatory written arrangements - we intend to mandate that the hub and the spoke must enter into written arrangements with each other in order to be able to take part in the new hub and spoke proposals. We would expect that where the hub and the spoke do not belong to the same legal entity, those arrangements would form a part of a legally binding contract. As part of the terms of that contract, we would expect there to be limitations on the use of any patient data that has been obtained or processed lawfully by the hub or the spoke, so as not to place the other party involved in a more disadvantaged position than they were prior to entering into those arrangements. In particular, it would be important, and we would expect that, any data is processed in a professional manner - otherwise, there is the possibility that there could be a breach of article 9(3) of UK GDPR.

We feel that the information gateway, combined with the professional confidentiality requirement, the existing professional responsibilities and accountability of a healthcare professional plus the written arrangements or contract between the 2 parties creates 4 elements of protection as regards the processing of patient data including special category data. Under the proposals, this information gateway also provides a sanction in that, should the hub and spoke fail to produce the mandatory written arrangements, or the spoke fails to display the mandatory notice, an assumption will be made for enforcement purposes that any transfer of information between them for the purpose of hub and spoke models will be outside of the information gateway and the underpinning data protection requirements - and therefore, may be subject to regulatory action by the ICO.

In accordance with article 36(4) of UK GDPR we have consulted the ICO on the basis that during the operation of hub and spoke arrangements (which may or may not be part of the same legal entity), there will be a need to transfer patient data between the 2 premises.

The ICO have raised no issues. However, it will be important that as part of the arrangements each premises complies with UK GDPR, personal data is protected and only shared with and used by those who need to see it for the purpose it is supplied. The ICO is responsible for upholding information rights and for taking appropriate action where data protection law has not been complied with.

Comments provided on reimbursement

Comments noted that current reimbursement is based on prescription item numbers, to a large extent, particularly the clawback. It was suggested that there would need to be a review of affected reimbursement calculations, to take into account items being assembled elsewhere and so give clarity on who would be reimbursed by the NHS, the hub or the spoke pharmacy.

Government response on reimbursement

In relation to whether it would be the hub or the spoke that would be reimbursed by the NHS for items dispensed by the hub pharmacy, we consider that this is not a matter that is within the scope of the HMRs. However, in order for the hub and spoke models to dispense NHS prescriptions, the spoke must be on the NHS pharmaceutical list as they are the party who will receive the original order from the patient. We would expect, therefore, that it will be the spoke that is remunerated for the provision of the dispensing service. We would expect that as part of the written arrangements that we intend to mandate between the spoke and the hub, the spoke will pay the hub for the activities that it carried out, including the cost of any medicines that the hub supplied. However, this will be a private arrangement between the hub and the spoke under the terms of those arrangements.

As far as the HMRs are concerned, there is nothing to stop a hub being on the NHS pharmaceutical list in its own right, but it will only be able to submit prescriptions for NHS payment directly sent or received by it. This question of where reimbursement is made in this situation could be considered as part of the NHS pharmaceutical services under hub and spoke models, which each devolved administration will need to consider within their own territory, including any consequential amendments to their NHS pharmaceutical legislative framework.

Comments provided on miscellaneous other matters

Respondents offered the following other comments, suggesting that:

• the government should take on more responsibility for driving patients into community pharmacies, particularly in deprived and marginalised communities, so they can receive interventions which tackle co-morbidities
• it will be important to understand how new technology and inter-company hub and spoke models will affect behaviour - including the need to build trust so that pharmacists are not rechecking bagged prescriptions at the spoke. Ownership of hubs could affect where prescriptions are sent
• there could be incentives to move pharmacies in order to use a particular hub
• OPD is needed to help hub and spoke models maximise their efficiency using automation
• pharmacy technicians should be considered as independent practitioners in their own regard. Hub and spoke may provide leverage for pharmacy technicians to undertake other duties under PGDs, legislation permitting

Government response on these other matters

We agree that behavioural change and trust between parties will be required to manage the new processes efficiently and make the best use of technology involved with hub and spoke. Hubs and spokes will need to consider this when they discuss the governance and accountability that they want to put in place and then formalise that through the written arrangements between them that we intend to mandate under the proposals.

On OPD, amendments were made to the HMRs to enable OPD in Great Britain in September 2023 - these came into force on 11 October 2023 in Scotland but cannot be utilised for NHS prescriptions in England and Wales until further amendments have been made to the PLPS regulations in England and the NHS (Pharmaceutical Services) (Wales) Regulations 2020 in Wales, following discussion with national community pharmacy representative bodies. OPD is expected to complement the hub and spoke policy as it could enable more medicines to be dispensed in their original pack which subsequently would enable a greater use of automation, which hubs are expected to utilise. The more prescriptions that can be dispensed via automation, the more prescriptions that can be prepared by the hub.

In relation to the suggestion that pharmacy technicians should be considered as independent practitioners in their own regard, they are already regulated by GPhC in Great Britain and subject to annual revalidation. The government and devolved administrations have a shared desire to fully realise the potential of all pharmacy professionals and make more efficient use of the skill mix in pharmacy teams. The government has consulted on proposals to enable pharmacy technicians to supply and administer medications via PGDs without the need for an independent prescriber to be present, and on legislative proposals to modernise supervision arrangements, the public consultation for which ended on 29 February 2024. These proposals aim to create a framework in which pharmacists, pharmacy technicians and the wider pharmacy team can thrive, enabling pharmacy technicians to maximise the contribution they make within multi-professional teams, through more effective use of their skills and expertise in pharmaceutical care.

6. Drafting of the amendments to the Medicines Act 1968 and the HMRs

We asked respondents to share any views on the amendments being proposed in the consultation. Sixty-six per cent of respondents (52 individuals and 34 organisations) did not share any view.

Summary of responses

Forty-five respondents shared a view of a wide variety of topics. These comments have all been reflected elsewhere in this response apart from the following comments, specifically about the drafting of the proposed amendments, provided by 9 organisations.

We heard that draft regulation 3 is a key amendment in enabling a pharmacy to assemble medicines for another pharmacy that is not in common ownership - however, it appears that the amendment that removes the words “forming part of the same retail pharmacy business” will not permit a hub pharmacy to assemble medicines and supply them to a dispensing doctor without an assembly licence.

About draft regulations 4, 5 and 6, we heard:

• draft regulations 4, 5 and 6 would amend sections 70, 71 and 72 of the Medicines Act 1968 which contain conditions to satisfy the definition of “lawfully conducting a retail pharmacy business”. These draft regulations refer to orders that are “submitted at the premises”. However, it was not clear if the words “submitted at” mean “submitted to” the spoke by a patient or “submitted by” the spoke to the hub. If the former, it would be simpler to say “if orders for the sale or supply of medicinal products are received at the premises”
• draft regulations 4,5 and 6 would also amend the condition in sections 70, 71 and 72 of the Medicines Act 1968 for a notice to be displayed, giving the name and registration number of the responsible pharmacist. It appears from the draft regulations that the notice does not have to say the prescriptions will be dispensed elsewhere or identify the hub that will dispense a specific script. It appears that the same notice must be used as the one giving the name and registration number of the responsible pharmacist. This may create logistical difficulties for spoke pharmacies that use a standard form of notice, because existing standard notices will all have to be replaced

About draft regulation 9, we heard that this contains a definition of NHS GP surgery that would be inserted into regulation 8 of the HMRs. This definition seems very wide and could catch a registered pharmacy that is located within the surgery premises. Since the premises of dispensing doctors must be included in a dispensing doctor list (see regulation 46 of the National Health Service (Pharmaceutical and Local Pharmaceutical Services) Regulations 2013), we suggest the definition should refer to the premises on a dispensing doctor list other than registered pharmacy premises.

About draft regulation 11: the inclusion of “at or from” in regulation 220 of the HMRs, we heard:

• this will be inconsistent with the requirement in section 129(2) of the National Health Service Act 2006 and regulation 10(1) of the National Health Service (Pharmaceutical and Local Pharmaceutical Services) Regulations 2013, which require listed pharmacies to provide services “from premises”. It would make sense to amend the act and the 2013 regulations so that they are consistent with the HMRs
• this introduces legislative ambiguity as to how, when and by whom a supply is made to a patient
• it was inappropriate to propose this change prior to the outcome of the consultation on supervision because there is no clarity over what supervision amounts to when a home delivery is made, or medicines are collected from a machine that is not on a registered pharmacy premises
• one respondent stated that it would be preferable to consult separately on this revision because the rationale was not clearly set out, the impact on patient safety was not explained and the change may lead to a number of interpretations that might lead to the emergence of different medication supply models that may or may not involve a registered pharmacy premises, outside of the jurisdiction of the pharmacy regulators

About draft regulation 13, sections 222A and 222B, we heard:

• any ‘arrangements’ proposed in the HMRs section 222A(3) and section 222B(b) between the parties should be legally binding, because the interfaces between different systems and operations are at the highest risk and the most needing of control, inspection and procedures
• the ‘arrangements’ should be written down
• existing well-understood terms such as ‘retail pharmacy business’ could be used rather than new terms. It may be helpful to confirm whether deemed supply by a spoke pharmacy is supply and so forth for the purposes of regulation 220 of the HMRs and, therefore, requires pharmacist supervision by the spoke pharmacy, as appropriate
• treating a sale by hub to spoke as retail - this is confusing, because the spoke is then defined as a ‘retailer’. Yet in the proposed regulation 222B, the spoke is the ‘first business’. It would support consistency and clarity if they were defined instead as the ‘spoke’ and the ‘hub’
• the wording around ‘retail sale’ was too complex and would be better accomplished by exempting hub and spoke pharmacies from the need to have a wholesale dealing license
• a sale or supply direct from a hub to a patient is deemed to be a sale or supply from the spoke, but it may also be a sale or supply by the hub. If the hub supplies to a patient, a pharmacist at the spoke cannot be supervising and, indeed, the hub may supply at a time when the responsible pharmacist is absent from the spoke. The draft regulations aim to tackle this in 222B of the HMRs by treating the sale by the hub as being made when the prescription was submitted to the spoke or anything else that forms part of dispensing is done at the spoke. The draft regulations stop short of saying that for the purpose of regulation 220, supervision is deemed to have taken place at the spoke. It would be better if it did. Alternatively, it would be better to require supervision by a pharmacist at a hub that makes supplies to patients to supervise, analogous to the way that regulation 248 of the HMRs deals with supervision when a collection and delivery model is used. Without such a provision, it is not clear how supervision is exercised at a spoke when a delivery is made by a hub to a patient’s home
• the wording of regulation 222A(1) (b)(ii) in the HMRs would read better if it said “sold or supplied to a person who is lawfully conducting a retail pharmacy business at or from that pharmacy” because the term ‘lawfully conducting a retail pharmacy business’ is well-defined in sections 69 to 72 of the Medicines Act 1968
• regulation 222A(2) states “For the purposes of these Regulations and the Medicines Act 1968, the sale or supply mentioned in paragraph (1)(b)(ii) is treated as a retail sale, unless paragraph (3) applies”. Regulation 222A(3) states that paragraph 3 does not apply “if the retailer has not entered into arrangements with…”. However multiple respondents thought it should read the opposite

It was suggested that sections 70 to 72 of the Medicines Act 1968 should specify that a conspicuously displayed notice should identify the name and address of who runs the hub, when hub and spoke models are in place. With the identification of the hub as part of the notice, there will be implications for amending the standard notice that pharmacists use as they will need to be replaced.

More clarity was requested on proposed changes to packaging (regulation 258 and schedule 25 of the HMRs).

It was also suggested that:

• the draft statutory instrument should include a provision that GPhC must produce detailed standards for these hubs and their relationship with the spoke pharmacies, that inspections of these hubs should be on an annual basis and that the hubs must release data into the public domain about their error rates. This could be achieved by adding an amendment to part 4 of the Pharmacy Order 2010 as amended by The Pharmacy (Premises Standards, Information Obligations, etc.) Order 2016
• regulation for dispensing doctors who engage in hub and spoke models needs to be clarified in the relevant regulations, as dispensing doctors are regulated by different regulators across the UK to community pharmacies
• use of the term ‘controlled drug’ should be better explained to define schedules and permitting those not subject to safe custody

Other views shared around the proposed amendments included changing legislation to end the splitting of medicine packs, only allow medicines to be prescribed and supplied in 28-day packs and not making any changes that would allow DSPs to charge for deliveries.

Government response on the drafting of proposed amendments

Having considered the responses received, we intend to make changes to the proposed drafting of the draft statutory instrument. We intend to:

• amend the draft regulations to ensure that a hub can assemble medicines and supply them to a dispensing doctor without the need for a manufacturing licence
• remove the hub and spoke noticing requirement from sections 70 to 72 respectively of the Medicines Act 1968 and to place them in the HMRs within the body of the new hub and spoke regulations 222A and 222B instead. Having considered some of the comments from respondents, this would ensure that a registered pharmacy business that fails to display a hub and spoke notice will still be able to conduct the remainder of their pharmacy business
• amend the definition of “NHS GP surgery” in the HMRs to “NHS dispensing practice” and to clarify that this is a business, a part of which NHS pharmaceutical services are provided by GPs. This is to provide that a dispensing doctor is someone who specifically provides NHS pharmaceutical services
• amend the wording of draft regulations 222A and 222B for clarity and to avoid confusion
• amend the HMRs so that the hub and the spoke can decide between themselves whose contact details should be named on the label of the medicine - one of their names must be agreed to as part of the arrangements but it cannot be both

We have decided not to adopt other suggestions and explain our reasoning below.

In relation to comments relating to “submitted at” the premises - we are of the opinion that it is clear that the pharmacies in question are those at the spoke, where the patient submits the prescription.

In relation to comments relating to “at or from”: the purpose of amending these regulations is to ensure consistency and to clarify the position within the law. In the Medicines Act 1968 (including section 72A), “at or from a pharmacy premises” is used, whereas in the HMRs (including regulation 220) it is “on pharmacy premises”. For the purposes of the Medicines Act 1968, we find that the responsible pharmacist is responsible for the delivery of pharmaceutical services “at or from” the premises that they are responsible for - the amendments to the HMRs bring these references into line with that act. Our view is that it therefore clarifies the position that the responsible pharmacist remains responsible for the whole of the pharmaceutical service, that is until the medicine is in the patient’s hands. From a hub and spoke context this is likely to be especially relevant in model 2 as we expect the main use of model 2 to be when the medicine is being delivered to the patient directly by the hub.

It was also suggested within the comments that section 129(2) of the NHS Act 2006 and the PLPS regulations (for England only) could also be amended to provide consistent language on “at and from”. In relation to these suggested amendments, we do not have the powers under the MMDA to amend the NHS Act 2006 or the PLPS regulations, but this could be considered as part of a separate workstream. For example, amendments may need to be made to the PLPS regulations (in England only) in order to implement the hub and spoke models for the purposes of the provision of NHS pharmaceutical services and this amendment could be considered there as well.

There was a query about why the agreement between the parties may or may not be legally binding. We understand that there could be circumstances, for example, whereby subsidiaries of the same company may take on the mantle of a hub and provide hub and spoke services to a spoke that belongs within the same company. Under these circumstances we consider that it would not be possible for any arrangements between that hub and that spoke to be legally binding. We would expect, however, that for any businesses that utilise hub and spoke and do not belong to the same legal entity, the arrangements they enter into would be in the form of a legally binding contract.

There was a query about how the spoke pharmacist could be responsible for dispensing medication to the patient under model 2. In this model, we intend to create a new ‘parallel retail sale’ that works alongside the existing ‘retail sale’ to provide that the spoke must be a retail pharmacy business. Subsequently, there must be a responsible pharmacist involved at the spoke who will be professionally accountable for any part of the process carried out at the spoke. The pharmacist at the hub would be professionally responsible and accountable for any activities at the hub that they themselves undertook or supervised. A dispensing doctor can also act as a spoke and they too would be professionally responsible and accountable for any activities that they carried out or that were carried out under their supervision.

There was a suggestion in the responses that we could simply give hub and spoke arrangements an exemption from needing a wholesale dealing license to move medication between the 2 businesses. In our opinion, we will not achieve our desired aims to ensure accountability, safety and transparency if we were to do this. We feel that this would be too broad in scope and would not establish our requirement that the hub must be a retail pharmacy business. This is something we intend to achieve by creating a ‘deemed retail sale’ between the spoke and hub in model 1 and a ‘parallel retail sale’ between the spoke and the patient in model 2. This would then mean that any medication assembled by the hub must be carried out under the supervision of a registered pharmacist, with the end-to-end governance and professional accountability that this entails. In terms of model 2, we intend to create a ‘parallel retail sale’ between the spoke and the patient. This again ensures that the spoke must be a retail pharmacy business, being carried on under a responsible pharmacist and with the end-to-end governance and professional accountability that this entails.

In addition, wholesale dealing licenses cover transfer of medication where there is no retail sale or supply corresponding to retail sale - that is, a final retail supply to the patient. It is also not carried out on a named patient basis, which is not what will happen if medicine is transferred between the spoke and the hub (in either direction) under these proposals. In the hub and spoke models, medicines are always moved between the 2 businesses having been dispensed in accordance with a prescription for a specific named patient, as set out above in ‘Supply of medicines from spoke to hub’ (in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency and accountability and access for dispensing doctors to hub and spoke model’). We will ensure that a dispensing doctor will be able to utilise the hub and spoke arrangements in such a way that they can benefit from the new types of retail sales without being considered to be a retail pharmacy business. For further explanation of these new types of retail sale, see Annex A, below.

On controlled drugs, we confirm that schedule 3, 4 and 5 drugs can be included in model 1 hub and spoke arrangements and that schedule 4 and 5 drugs can be included in model 2 hub and spoke arrangements. Schedule 2 drugs may also be able to be included in model 1 hub and spoke arrangements, providing the record keeping requirements in regulation 19 of the Misuse of Drugs Regulations 2001 are met. The department has concerns about whether it would in fact be possible to meet these obligations and is exploring with the Home Office the inclusion of schedule 2 and schedule 3 drugs within model 2 hub and spoke arrangements, as well as clarification on inclusion of schedule 2 drugs in model 1.

On the concern that the hub and spoke models would not be possible under article 40 of the EU Medicines Directive 2011/83 (the Medicines Directive), because there would be a requirement for a wholesale dealing license, we assume that the basis for this concern is in the context of a spoke based in Northern Ireland and a hub based in Great Britain working under model 1 of hub and spoke. We consider that this concern is unfounded as we find that the joint acts of dispensing of the hub and spoke can be treated as final retail supply for the purposes of article 40(2) of the Medicines Directive, and therefore neither a manufacturing license nor a wholesale dealing license are required in these instances.

On the other views shared on making amendments to the legislation (for example, to end the splitting of medicine packs, only allow medicines to be prescribed and supplied in 28-day packs and not making any changes that would allow DSPs to charge for deliveries), these legislative changes were not proposed in the hub and spoke consultation and are not directly relevant to hub and spoke models, so will not be considered for action.

7. Impact assessment and equality considerations

Assumptions, figures and conclusions in the impact assessment

Comments on the conclusions drawn from data

We asked respondents to what extent did they agree or disagree with the assumed uptake and profile of the hub and spoke models. We also asked for the level of agreement or disagreement with other assumptions, figures and conclusions.

There was a high level of disagreement with the assumptions made in the impact assessment about the profile and uptake of hub and spoke models, as well as the assumptions, figures and conclusions reached in the impact assessment.

Concerning the assumed uptake and profile of hub and spoke dispensing, 87 respondents (33 organisations and 54 individuals) provided a view on these assumptions. Of these:

• 31% supported the assumptions on uptake and profile - 13 strongly agreed and 14 agreed
• 69% rejected the assumptions on uptake and profile - 40 strongly disagreed and 20 disagreed with the assumptions

Concerning the assumptions, figures and conclusions in the impact assessment more generally, 79 respondents gave a view on these aspects - of these:

• 19% supported the general assumptions, figures and conclusions in the impact assessment - 3 strongly agreed and 13 agreed with them
• 81% rejected the general assumptions, figures and conclusions in the impact assessment - 41 strongly disagreed and 22 disagreed with them

There was no significant difference between organisations and individuals about the strength of these views.

As shown above, a low proportion of respondents who gave a view agreed or strongly agreed with the details of the impact assessment and the remainder expressed disagreement. However, their disagreement stems from there being 2 distinct positions about why the data used in the draft impact assessment was seen to be incorrect or inadequate. One view was that there would be greater and faster uptake than predicted, because of other benefits not mentioned and because we had not taken into account the latest technological developments which make the model relevant and beneficial to smaller pharmacies.

Comments on this theme included:

• as few as 3 spoke pharmacies could benefit from hub and spoke models
• more than 60% of prescriptions could go through the hub
• viable hubs operating now are processing as little as 45,000 prescriptions a month
• set-up costs for hubs and spokes would be lower
• hub turnaround times can be quicker than 2 days

The other position was that there would be minimal uptake (less than predicted) because of a significant underestimation about a variety of measures that would deter pharmacies from entering into a hub and spoke model. For example:

• missing costs included start-up legal costs, additional management costs, integration with patient medication records (PMRs), validation, operational infrastructure, ongoing maintenance, business continuity, hub transport costs and costs in addition to basic salaries (that is, on-costs, National Insurance and pension contributions)
• the current Community Pharmacy Contractual Framework 2019 to 2024 is not sufficient to allow for the level of investment from the sector needed to cover the up-front set-up costs
• the cost of dispensing a prescription is too low and the cost of automated dispensing is unattributed
• the assumption that all hubs will use automation is incorrect as this is not the case now, so the benefits of automation will not necessarily apply to the proposed models
• the discount factor and training costs have been underestimated
• minimum staffing levels mean that any opportunities to use spare time to generate additional income will be hard to realise, especially as community pharmacy funding is fixed and local NHS commissioning opportunities are variable
• prescription volumes would need to be higher to be viable for a hub and spoke model

More general points about assumptions, figures and conclusions were:

• it is correct to assume that smaller independent pharmacies can become more efficient and free up time for spoke pharmacy teams by utilising hub and spoke models
• the spokes will realise savings by not having to hold as much stock on site, but this could be offset by the stock requirements of the hub
• the modelling needs to be updated to consider the increased costs of business operations due to inflation and increases in rents and rates
• it would have been useful to see an analysis of the percentage of prescriptions that are repeats, since those would be most suitable for hub dispensing
• the impact assessment needs to clarify if set-up costs for existing hubs have been included in the calculations and assumptions
• the non-monetarised benefits stated are unqualified or anecdotal so it is hard to know how reliable their delivery will be - more evidence on them would be helpful

Comments on the applicability of existing hub and spoke benefits and costs to the new models

Our estimates of potential sector-wide costs and benefits were informed by evidence from community pharmacy providers who are already utilising hub and spoke models. We asked respondents to give a view on how strongly we could rely on these costs and benefits being relevant to other business models.

Fifty-three per cent of respondents (42 individuals and 27 organisations) gave no view on this question.

Where comments were provided about how equivalent the different business models were, 2 respondents felt that the costs and benefits being experienced currently could be applied to the new proposed models while 17 respondents felt that these costs and benefits were not equivalent due to significant differences. Six respondents felt that it was too difficult to come to a view without having more information. Of the more detailed comments given, key points were as follows:

• where the hub and spokes are part of the same legal entity, they have over-arching operational control so can enforce operational consistency more rigorously (such as with training and SOPs), to ensure each individual spoke relates in the same way operationally to a given hub. This allows the ‘handover’ of processes between the hub and spoke to be consistent and simplified, minimising the need to check that there are no omissions in the overall process while ensuring safety standards. This smoothness may not be possible to build into a model that spans different legal entities
• each of the multiples has spent a decade or more developing their own system with considerable input of time, people and both capital and operating expense. This level of resource is unlikely to be available to all but the largest of independent chains. So even if the new models can reach this point in the future, it may take years for them to realise the same level of benefits
• the multiples are able to make use of the resources freed by centralised assembly in different ways, including moving resources between stores, which will not always be available to independents so they might have less opportunity to take advantage of any benefits realised
• there will only be one set of IT for current operators. New hubs relating to spokes from different legal entities will need to interface with several PMR systems, which may increase the overall cost or prove too difficult, depending on IT supplier flexibility
• existing vertically integrated companies are likely to purchase more of their medicines through their in-group wholesaler or associated wholesaler respectively (with hubs often co-located inside the wholesalers), rather than smaller pharmacies who ‘shop around’ from several wholesalers. Potentially those wholesalers’ own imbedded hubs may compare deal prices and discount order levels etc so can choose which hub dispenses which prescription
• where hubs have already been built by a company to serve its own pharmacies (and the development and build costs are already spent or sunk), it will still make financial sense for that company to operate the hubs even if their spoke benefits just cover the ongoing operational costs. New hub entrants would need to be confident that they can charge a rate to spokes that will cover not just the ongoing operational costs, but also the development and build costs, plus a margin to incentivise them to take the financial risk. It is not clear if this has been taken into account when producing the impact assessment

Comments on our request for new evidence

We asked respondents to provide any evidence that would help us to develop the cost-benefit analysis on these proposed changes. We also asked respondents whether they had any information on the associated costs and benefits of alternative business models.

84% of respondents (110) replied that they did not have any information to share about alternative business models. Further comments concerned doubt that there were other models and one view that automation using robots in community pharmacies would be a quicker way to realise cost savings. A mail order company stated that their way of working was not an alternative but could contribute to the proposed hub and spoke models.

Seven organisations provided specific detail of their own data and comments reflecting on the quantitative aspects of our assumptions.

Four organisations offered to provide further information to the department based on their experience of service provision relevant to the proposed hub and spoke dispensing models. We were able to make contact with 2 of these respondents to explore their information and held a meeting with each. One respondent provided evidence about their view that less pharmacies would be likely to adopt hub and spoke dispensing across different legal entities than we forecast and the other respondent provided evidence about their view that more pharmacies could benefit from hub and spoke dispensing across different legal entities.

In support of there being less take-up of the hub and spoke models than predicted in the impact assessment, key points from our meeting were:

• trust will be a considerable barrier. It would take a significant leap of faith for one pharmacy business to trust another business to purchase medicines on their behalf and also to share patient data from the prescription
• it is hard to make sufficient margin to cover the additional running costs and bank borrowing costs
• the legal requirement to dispense exactly what is on the prescription limits what the hub can supply, even with OPD coming into force
• clinical checking is still a manual process - staff recruitment difficulties limit the volume that the hub can process
• hubs could process more if they operated 24 hours a day, but no pharmacists would want to work those hours
• dispensing volume is increasing so fast that this absorbs any spare capacity in the spokes, especially with other pharmacies being sold or closing down recently
• in their experience of hub and spoke, turnaround time with a smooth process is around 4 days
• in the particular case discussed, the cost of hub dispensing was working out to be £2.14 per item less than the cost of spoke dispensing
• in the particular case discussed, there was evidence from a period of time that showed there were less errors in the hub (0.005%) than seen in the spoke, although error rates in the spoke were still very low (0.014%)

In support of there being greater take-up of the hub and spoke models than predicted in the impact assessment, key points from our meeting were:

• pharmacy owners who own more than one chain of pharmacies are waiting for the legislative change to bring these different businesses together into one hub and spoke model
• all hub and spoke models known to this respondent use automation
• any pharmacy business that has a total volume of around 144,000 dispensing items a year would benefit from the latest hub and spoke technology
• there is a much larger volume of businesses (of all different sizes) already using hub and spoke dispensing than is acknowledged in the impact assessment
• in one example of an independent pharmacy group using hub and spoke, spoke pharmacies spent 30% less time on dispensing and pharmacists spent 50% more time with patients in store since adopting hub and spoke - the hub dispenses 68,000 items (109,000 packs) per month with 5 staff working full-time
• the businesses using hub and spoke technology who are known to this respondent all operate on a next day model of dispensing
• hub and spoke models enable a calmer and less pressured for staff

Other comments on the impact assessment

We asked respondents to provide any comments on the impact assessment not already provided under any of the previous questions and tell us about any likely impacts that had not been mentioned. In response:

• 37% of respondents (14 individuals and 35 organisations) provided further comments about the impact assessment itself
• 34% of respondents (29 individuals and 26 organisations) provided comments about any other impacts not considered

Key points made about the impact assessment that have not already been referred to in earlier sections above or elsewhere in this document are:

• technology providers may need the legislative changes currently being considered in order to have an incentive to invest in developing the technology needed to make hub and spoke models viable to smaller pharmacies
• the use of branded generics and prescribing habits creates additional complexity on the number of Stock Keeping Units (SKU) that need to be created. This creates no benefit for the patient and impacts drug reimbursement as well as the operational efficiency of the hub
• there is a risk of market distortion and rigidity because PMR providers need to provide an open channel to allow integration with organisations that have developed solutions. PMR providers are already creating affiliations with potential hub partners, the clear impact of this being the prevention of wide adoption of hub and spoke as spokes would be tied into the hub of their PMR provider’s choosing and not that desired by the spoke. This puts PMR providers into a market dominant position where the disruption to a spoke of changing PMR provider means that they are stuck with the affiliate hub and are therefore not in control of the dispensing relationship with the hub and the patient
• the risk profile of developing hubs will be much higher due to the inability (due to competition law constraints) to co-ordinate hub provision versus pharmacy demand. This itself (namely the mismatch of supply and demand) could cause issues with continuity of supply and wider supply chain disruption
• we should pay significant attention to the balance between supporting retail pharmacy, especially in the independent sector, and opening the market to monopolisation by national groups, wholesalers and potential outside influences from non-market specific mail order businesses
• evidence obtained from other European countries may not be applicable in the UK due to the different models of operations and payment systems. Some European markets (for example, the Netherlands) make more use of unit dose dispensing than others. This requires automation but not the kind that is used for the UK’s centralised assembly systems working on whole patient packs

In relation to impacts not covered by the impact assessment, other than missing issues not addressed as costs or benefits (see ‘Assumptions, figures and conclusions in the impact assessment’ in section 7, ‘Impact assessment and equality considerations’), key points were:

• the impact assessment should mention the significant positive impact on accuracy and efficiency that can come through having sufficient high volume of dispensing in a hub to justify the use of automation. Detailed processes and use of the latest technology ensure that all the drug data is recorded from the label barcodes at high speed throughout the dispensing process and then matched accurately to each specific order. The records give transparency to the spoke and overall assurance of drug quality
• the impact assessment is based on the possible impact in England. It needs to be expanded to consider any impact on the devolved administrations given different characteristics of geography, economy and population demographics. In addition, community pharmacy provision, contractual conditions and regulatory processes are different - for an overview of comments that relate specifically to Northern Ireland, see ‘Different impact on people who live in Northern Ireland’, below. Other comments related to Scotland and Wales were:
  • in Scotland, the Scottish Pharmacy Contract states that responsibility for clinical and final checks take place at the spoke, with assembly only taking place at the hub
  • the Welsh Government has a new community pharmacy policy and also policies to support high street regeneration and support of businesses in predominantly Welsh-speaking areas
  • electronic prescriptions are not available in Scotland or Wales and timescales to implement EPS systems are uncertain. This makes it more difficult to implement hub and spoke in these nations and forecast an uptake profile
  • impact on dispensing across borders needs to be considered
  • there is a risk that hubs could ‘cherry pick’ by choosing not to engage with pharmacies based in remote locations to avoid high delivery costs. Although this would affect parts of England, Scotland and Wales would be affected particularly if this happened
  • there is a risk of social and economic cost if jobs in one country are lost to another country
• the impact of hub and spoke on small rural pharmacies does not appear to be fully established within the impact assessment. These pharmacies will be more susceptible to medication delays. If hub and spoke causes destabilisation of pharmacy income, this could have implications for GP practices in rural communities. This could be further impacted in instances where the hub and spoke are in different parts of the UK, including different countries
• retention of the medicine margin is a significant part of the Community Pharmacy Contractual Framework so the impact assessment should consider if this could be affected by hub and spoke models
• activities of disruptors, who challenge boundaries, have not been predicted or modelled
• unless hub and spoke dispensing is introduced alongside the ability for pharmacy technicians to provide clinical services appropriately, (for example, if HM Treasury revise the VAT rules) then some pharmacy technicians could find themselves without employment when the dispensing moves to hub models

Government response on figures, assumptions and conclusions

We acknowledge the evidence from stakeholders that there are at least 2 other possible scenarios which may result from the change in legislation to allow hub and spoke models across different legal entities. These were reflected in the questionnaire responses and also in our follow-up meetings. One is that there will be minimal uptake across community pharmacy, mainly due to the culture of independent business and it being unfamiliar for businesses in partnership to deliver pharmaceutical services, but also because of businesses feeling unsure about the extent of returns on investment, difficulties with staff recruitment and the complexity of the models needed. The other position is that the benefits, in terms of time saved on dispensing and stock control in the spokes, are significant enough for community pharmacies to want to adopt hub and spoke models and overcome the initial barriers. Also, pharmacy owners who are directors of more than one pharmacy business may find it easier to adopt hub and spoke models across all of their branches as they will not have the initial trust barriers to overcome and concerns about liability that may face different owners who want to work co-operatively.

Robust justifications were given for these 2 opposing views. In the first category (expecting minimal uptake) were mainly larger multiples, organisational bodies representing pharmacies, plus wholesalers and other distributors of medicines. The second category (expecting greater uptake) included stakeholders in the business of providing innovative solutions for community dispensing. Although the latter body of opinion was smaller than the former, we do not see that as a reason to discount the perspective of the smaller group as we acknowledge that their insight is due to their different experience from a technological innovation perspective.

Given the 2 opposing positions, and a lack of information needed to extrapolate from this evidence further (for example, we do not know how many pharmacy owners own more than one business), we have decided to retain the core of our original assumptions in the impact assessment, since we regard this as presenting the middle ground between both opposing positions. When we carry out our review of the market on the impact of competition (as referenced above in ‘Comments provided on competition and market entry’ within section 5 ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’), we will explore which position seems to be the one emerging as most likely.

Other comments on the methodology

In relation to other more specific aspects of the assumptions and figures in the impact assessment, we have amended calculations to take into account rurality and to update the financial components, for example, to take into account inflation and wage rises.

Different impact on people who live in Northern Ireland

The Department of Health in Northern Ireland do not consider that our proposals risk impacting different people differently with reference to their protected characteristics or where they live in Northern Ireland. We asked respondents whether they had views on this.

Summary of responses

Eleven per cent of respondents (6 individuals and 8 organisations) commented on this question, as detailed below.

Three respondents requested that a separate impact assessment be developed for Northern Ireland because of its unique geographic, economic and political context, as well as the different nature of its community pharmacy provision.

It was noted that the public in Northern Ireland receive on average 20 items per person every year, which is a higher number per person than any other part of the UK, reflecting the impact of the Troubles and poorer socio-economic factors, especially regarding housing and income.

Respondents commented that that pharmacies in Northern Ireland provide access to healthcare where other services are completely absent, offering a wide range of commissioned services extending beyond the core services of ordinary and multiple dispensing.

At the point of consultation - which took place when the old Northern Ireland Protocol still applied, before the Windsor Framework was agreed - respondents commented on additional complications caused by the old Northern Ireland Protocol. The old protocol, if applied in full (temporary derogations were in place at that time), would have impacted on the stability of the supply chains.

Other comments noted that:

• supply issues are made more complex by extreme weather conditions impacting on sea transport routes
• a large proportion of medicines supplied by pharmacies in Northern Ireland are sourced from Great Britain. Respondents questioned whether hub and spoke models would work across Northern Ireland if the hubs they were supplied by were based in Great Britain
• 30% to 40% of pharmacies in Northern Ireland are too small to be able to benefit from hub and spoke models

Government response on different impact for people who live in Northern Ireland

It has been decided that it is not necessary to carry out a separate impact assessment for Northern Ireland in respect of the proposals put forward in this consultation, as the purpose of these amendments are to enable all community pharmacies and dispensing doctors to access hub and spoke dispensing arrangements, but this will not be mandatory. Once any legislative changes have been made, the Department of Health in Northern Ireland plan to have further discussions with relevant stakeholders before implementation plans for hub and spoke dispensing arrangements will be taken forward in Northern Ireland, along with any amendments to the Pharmaceutical Services Regulations Northern Ireland1997, and will consider a range of impacts, including Equality Impact, Regulatory Impact and Rural Needs Impact, in line with the department’s statutory responsibilities.

On the issue of stability of supply to Northern Ireland, the Windsor Framework has addressed this by delivering a UK-wide licensing regime for medicines. Patients in Northern Ireland will therefore be able to access the same medicines as patients in the rest of the UK, once it is implemented.

Impact on people with protected characteristics and equality

We asked respondents to provide details on how the proposals risk impacting people differently with reference to their (or could impact adversely on any of the) protected characteristics covered by the Public Sector Equality Duty set out in section 149 of the Equality Act 2010 or by section 75 of the Northern Ireland Act 1998.

We also asked respondents to provide any evidence that we should consider in the development of an equality assessment.

Summary of responses

Eighty-four per cent (111) of respondents did not provide a view on how people with protected characteristics would be impacted or said that they were unsure. Of the remainder (20 respondents):

• 50% (10) replied that there would be a different impact on people with protected characteristics
• 50% (10) replied that they did not think that there would be a different impact on people with protected characteristics

More detailed comments emphasised that:

• it is vital for a pharmacist to be able to talk to people from vulnerable groups, such as people with disabilities, elderly people and people with low literacy. Due to these needs, they are more likely to require personal support from the pharmacy team to understand their medication and how to take it. Model 2 would rule out this option
• more deprived areas have higher levels of ill health from chronic conditions, as well as a larger number of people being prescribed controlled drugs, both of which could impact on the amount of clinical time freed up by hub and spoke models and thereby accentuate inequalities
• vulnerable groups would be likely to suffer disproportionately in the event of a problem with a hub
• splitting the dispensing process over 2 sites could potentially disadvantage or confuse some patients, especially if it meant that people received their medication in separate batches rather than at the same time
• the majority of pharmacy technicians are women so they would be particularly impacted by any reductions in employment of technician staff caused by hub and spoke
• freeing up time for pharmacies to provide more face-to-face care for patients could also allow domiciliary visits to patients who are unable to attend a community pharmacy because of health and disability issues

Government response on impact on people with protected characteristics

Under our Public Sector Equality Duty, we have considered if people with protected characteristics may be impacted differently by the changes to hub and spoke policy. The extent of any impact depends on the uptake of new hub and spoke models, which are enabling. In summary, our assessment is that the hub and spoke models do not address any unlawful discrimination but do present community pharmacy with the opportunity to foster good relations with people who have protected characteristics because pharmacy teams are expected to have more time available to give advice and offer clinical services to their customers, including people who have protected characteristics (such as older people and people with disabilities). In addition, the hub and spoke models present community pharmacy with the opportunity to advance equality of opportunity because dispensing doctors who serve rural patients will gain access to pharmacist expertise during the dispensing process, which is not available outside of these models. In addition, we would expect that the hub and spoke models involving dispensing doctors would foster good relationships between the pharmacist and the doctor. 

There could be negative impacts on equality of opportunity and fostering good relations if the hub and spoke models cause delays in dispensing or confusion for patients about their medication, which would affect patients with protected characteristics to a greater extent than the wider population. In addition, if working hours for dispensing staff in spokes are reduced due to greater efficiency delivered by hub and spoke models, it is possible that this would impact staff with protected characteristics (for example, women) to a greater extent because they make up a higher proportion of the dispensing workforce. Given that any impact on patients is likely to be during the initial transition phase only, while people become familiar with the new hub and spoke models, and that there are recognised shortages in the community pharmacy workforce, we do not consider that these potential negative impacts on equality are disproportionate.

8. Legislative background and basis

We propose making these legislative changes using the enabling powers in Part 2 of the Medicines and Medical Devices Act 2021 (MMDA).

Section 45(1) of the MMDA includes a statutory requirement for the appropriate authority (where the regulations are to be made UK-wide, the appropriate authority will be the Secretary of State for Health and Social Care and the Department of Health in Northern Ireland acting jointly) to carry out a public consultation on any regulations made under Part 2 of the MMDA.

Section 2(1) of the MMDA requires that, in making regulations about human medicines, the appropriate authority’s overarching objective is to safeguard public health. When considering whether the proposed regulations would contribute to the objective of safeguarding public health, the appropriate authority must have regard to the following 3 factors:

• the safety of human medicines
• the availability of medicines
• the likelihood of the relevant part of the United Kingdom being seen as a favourable place in which to:
  • carry out research relating to human medicines
  • conduct clinical trials
  • manufacture or supply human medicines

Safety of human medicines

As set out in section 2(4) of the MMDA, where regulations under section 2(1) may have an impact on the safety of human medicines, the appropriate authority may make the regulations only if they consider that the benefits of doing so outweigh the risks.

The majority of the evidence that we received during the public consultation supported our original assessment that patient safety will not be compromised by the introduction of the new hub and spoke models, providing that appropriate arrangements have been put in place and possible risks have been mitigated. It is feasible to expect that patient safety could improve under the new models, for reasons outlined above in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’.

One reason to expect an increase in patient safety under the proposals is that in the spoke, pharmacists and their teams will be freed up from routine dispensing tasks which should give them more time to deal with more complex tasks, patient queries and allow them to spot and deal with issues more quickly and effectively. Secondly, automation in the hub pharmacy will enable pharmacy staff there to focus on specified dispensing activities (as set out in the arrangements between the hub and spoke) so increasing the efficiency and accuracy with which they carry out these tasks. Reduced contact with patients in the hub pharmacy will minimise interruptions to the flow of work, so reducing the potential for errors, although there may still be some level of patient interaction if the hub was operating model 2 and supplying medicine directly to patients. Thirdly, as some respondents outlined, the use of scanned barcodes within the hub and spoke’s dispensing processes will support patient safety as the use of this technology can be expected to reduce the risk of medication errors. For example, systems would be configured to reject medication that does not match the order and so prevent the patient receiving the wrong item. Finally, the fourth reason to expect an increase in patient safety is that anecdotal evidence from consultation respondents supports the view that hub and spoke models can provide a calmer working environment for staff in both the hub and the spoke, due to staff having less disruptions to their daily dispensing actions and feeling under less pressure to complete a multitude of tasks.

Availability of medicines

We believe that it is unlikely that the hub and spoke models in themselves will cause any negative impact on the availability of medicines.

It is unlikely that there will any impact on manufacturers as the hub and spoke models will not affect the manufacturing processes of medicinal products.

Some respondents to the consultation were concerned about a possible impact on the price of medicine but there were no new concerns raised about the general availability of medicine, over and above existing concerns in the market already about shortages, which are due to a wide range of factors. One concern was raised about the possibility of hubs ‘skimming’ the spoke pharmacies for product but we do not consider that this is a risk because any transfer from the spoke to the hub, under the proposals, can only be done in the context of dispensing an individual prescription to a specific patient under the hub and spoke models - therefore this flexibility does not provide a legal basis for pharmacies to sell stock to wholesalers which may be looking to export or hoard medicines.

In relation to impact on medicine supply to patients, some respondents commented that there might be additional delays in dispensing due to the hub and spoke models but other evidence shared by respondents showed that hub and spoke models can provide next day supply when processes are effective and distance is not prohibitive. It is possible that patients may benefit from faster supply of medicines than normal in some instances, due to the possibility of hubs being able to purchase and store more types of stock and in larger quantities on their premises than might be possible currently at a smaller community pharmacy, therefore reducing the experience of delay in supply for patients.

The likelihood of the relevant part of the United Kingdom being seen as a favourable place in which to carry out research relating to human medicine, conduct clinical trials and manufacture or supply human medicines

We have not been provided with evidence to suggest that these changes to enable the new hub and spoke models will impact positively or negatively on the United Kingdom being seen as a favourable place to carry out research, conduct clinical trials or manufacture or supply medicines. The department has committed to continued engagement with stakeholders and will seek feedback on the operation of these regulations through the statutory reporting requirement within the MMDA.

9. Summary of our intentions and next steps

Amendments to the Medicines Act 1968

In light of the overall positive response, the government intends to progress the proposals to enable hub and spoke models across different legal entities as soon as possible by using the enabling powers in Part 2 of the MMDA to make amendments to the Medicines Act 1968 and the HMRs. The proposed amendments to be made to the Medicines Act 1968 are:

• amending section 10 of the act, to remove the restriction that a medicine dispensed at a registered pharmacy must be sold or supplied by that pharmacy or another registered pharmacy forming part of the same legal entity in order to rely on the section 10 exemption for a manufacturing license or marketing authorisation. This would mean that a medicine would be able to be sold or supplied at or from a retail pharmacy business, having been dispensed at a different registered pharmacy that belongs to a different legal entity and yet still be able to rely on the section 10 exemptions
• removing section 131 of the act, which covers the definitions of wholesale dealing, retail sale and related expressions. Therefore, by virtue of section 132 of the act, the definitions of those terms going forward will be of those found in the HMRs, to give clarity in medicines legislation

Amendments to the HMRs

The proposed amendments to be made to the HMRs include:

• the creation of 2 new models of hub and spoke: model 1 (spoke-hub-spoke) and model 2 (spoke-hub-patient). This will be done by creating 2 new regulations in the HMRs - regulations 222A (for model 1) and 222B (for model 2)
• the creation of 2 new types of retail sales to sit alongside a retail sale as it is currently governed. In models 1 and 2, a ‘deemed retail sale’ will be created for the movement of assembled or part-assembled medicines between the hub and the spoke. In model 2, a ‘parallel retail sale’ will be created between the spoke and the patient. For more explanation of these new retail sales, see Annex A, below
• that written arrangements must be in place between the hub and the spoke to give a comprehensive statement detailing their responsibilities, in order to be able to use the hub and spoke models
• that the spoke must conspicuously display a notice on their premises detailing the name and address of any hub pharmacy that they have entered into arrangements with alongside a brief statement of the general effect of those arrangements, in order to be able to use the hub and spoke models. If a pharmacy (including a DSP) and/or a dispensing doctor has an online presence and utilises a hub and spoke model, their website should display the same information conspicuously
• an information gateway (as a new regulation, 222C) for the hub and spoke models - this will make clear that the data sharing between the hub and the spoke for these purposes will be seen as compliant with UK GDPR and the DPA by setting out in legislation the lawful basis relied upon for processing this data. The information gateway will also extend the professional confidentiality requirement under article 9(3) of UK GDPR, so that any person employed by the hub or the spoke who is processing the data for those purposes will also share that same obligation of professional confidentiality as the responsible healthcare professional. The information gateway also provides a sanction in that, should the hub and spoke fail to produce the mandatory written arrangements, or the spoke fails to display the mandatory notice, any transfer of information between them for the purpose of hub and spoke models will be outside of the information gateway and therefore could be subject to regulatory action by the ICO
• that the hub and the spoke will have the autonomy to be able to agree between them whose details will be displayed on the dispensing label of the medicine. This will ensure that patients are clear about the point of contact for any queries about their dispensed medicines. It will be a requirement, as part of the written arrangements, that the hub and spoke must confirm which of them will have their details stated on the dispensing label as a point of contact (but not both). Dispensing doctors will also be subject to this requirement, if they are acting as a spoke
• that dispensing doctors will be able to utilise the hub and spoke models by acting as a spoke under the new regulations, in which case they will be required to conspicuously display a notice on their premises detailing the name and address of any hub pharmacy that they have entered into arrangements with, alongside a brief statement of the general effect of those arrangements
• that references to the sale or supply of medicines “at” or “on pharmacy premises” will be changed to “at or from pharmacy premises”

Territorial adoption

This is a UK-wide response to the consultation and our intention is to enable the new hub and spoke models for the whole of the UK. Therefore, we will be progressing the legislative changes as a UK-wide statutory instrument through the usual processes.

Parliamentary implementation

The government intends to lay the final statutory instrument before Parliament and the Northern Ireland Assembly in the coming months with a view to the proposals coming into force from 1 January 2025. This is, however, subject to the standard processes of obtaining the necessary internal and Parliamentary and Northern Ireland Assembly approvals. The final package may change as a result of those processes, but we hope that it is helpful to show the government’s thinking at this stage to enable the pharmacy sector and dispensing doctors to start exploring about how they might respond to the new flexibilities when they come into force. There will also be a process of engagement with the NHS national pharmaceutical services’ representative bodies to discuss any changes needed to NHS terms of service in each administration, in the light of these flexibilities. It is expected that this engagement will follow its usual pattern in each of the 4 countries.

Amendments to other secondary instruments

A range of other matters raised in the consultation evidence are not within the remit of the HMRs or the Medicines Act 1968 but could be addressed, as considered appropriate, through other secondary legislation.

With regard to the use of hub and spoke arrangements as part of NHS pharmaceutical services, each devolved administration will need to consider this within their own territory and whether there needs to be any consequential amendments to their NHS pharmaceutical legislative framework. For example, in England, discussion is ongoing with Community Pharmacy England to consider if amendments are needed to the PLPS regulations - which provide for the NHS terms of service for both dispensing doctors and NHS pharmacists - as to how community pharmacies and dispensing doctors can utilise hub and spoke arrangements as part of their NHS pharmaceutical services, including concerning any particular conditions linked to market entry, reimbursement, labelling and complaints procedures. Further, each administration may also want to consider if they wish to amend the relevant pharmaceutical regulations to ensure consistency with the updated language in the HMRs and the Medicines Act 1968 on supply “at or from” pharmacy premises.

Monitoring of the policy and review

Following the HMR amendments coming into force, we will engage regularly with the community pharmacy sector on hub and spoke models and, following recommendation from the CMA, will carry out an implementation review on competition once the hub and spoke market is sufficiently established, to explore what impacts are being experienced and consider further levers to address any barriers or undesirable consequences.

The updated impact assessment will be published when the draft statutory instrument is laid in Parliament and the Northern Ireland Assembly.

Annex A: further detail on ‘deemed retail sale’ and ‘parallel retail sale’

Hub and spoke dispensing models enable the routine aspects of dispensing prescriptions to take place on a large scale at a different pharmacy (‘the hub’) to the pharmacy at which the prescription was handed into (‘the spoke’).

For the purposes of clarity, throughout this document when we refer to a ‘hub’, we mean a registered pharmacy premises that has been designated as a hub in an agreement between the hub and the spoke. When we refer to a ‘spoke’, we mean registered pharmacy premises or a dispensing doctor that has been designated as a spoke in an agreement between the hub and the spoke.

Two new proposed regulations, 222A and 222B of the Human Medicines Regulations 2012 (HMRs) have been drafted to introduce the new hub and spoke dispensing models. As part of those models, 2 new types of retail sale are created under specific circumstances, which would operate alongside retail sale as it is currently governed. The proposed new regulation 222A deals with hub and spoke models where an order for medicines is submitted at or to the spoke, before some activities of dispensing (such as the medicines being assembled) take place at the hub. The assembled medicines are then sent back to the spoke before being supplied to the patient (model 1). The proposed new regulation 222B deals with the model where an order for medicines is submitted at or to the spoke, before some activities of dispensing taking place at the hub (such as the medicines being assembled). The hub then supplies the assembled medicines directly to the patient (model 2).

In both model 1 and 2, the movement of assembled or part-assembled medicines from the spoke to the hub and from the hub back to the spoke would be deemed as a retail sale, under the proposals.

In model 2, under the proposals, a ‘parallel retail sale’ has been created for the movement of medicines between the spoke and the patient when the final retail sale is between the hub and the patient.

The intention is that the ‘deemed retail sale’ achieves the following:

• the movement of assembled or part-assembled medicines from the hub back to the spoke in model 1 can take place without the need for the hub to possess a wholesale dealer license
• the movement of any assembled or part-assembled medicines from the spoke to the hub in both models 1 and 2 can take place without the need for the spoke to possess a wholesale dealer licence
• ensures that the hub must be a registered pharmacy (with the exception of where a dispensing doctor acts as a spoke)

The intention is that the ‘parallel retail sale’ ensures that the spoke must be a registered pharmacy (with the exception of where a dispensing doctor acts as a spoke).

1. Movement of assembled or part-assembled medicines from the hub to the spoke without the need for a wholesale dealer license in model 1

For the purposes of the HMRs, the movement of medicines from the spoke to the patient is the final supply of that medicine and would therefore be classed as a retail sale. However, under the HMRs, the movement of assembled or part-assembled medicines from the hub back to the spoke, prior to the final supply to the patient, would be considered wholesale dealing, as opposed to a retail sale and consequently the hub would require a wholesale dealer license to be able to lawfully carry out those transactions.

To ensure that registered pharmacies acting as a hub for the purposes of the hub and spoke dispensing models do not require a wholesale dealer license to enable this movement of medicine, we intend to amend the HMRs so that this specific transaction between the hub and the spoke is considered a ‘deemed retail sale’, as opposed to wholesale dealing.

We take the view that the movement of medicine between the hub and the spoke will always be on a named patient basis, meaning that these medicines are required for a specific patient in accordance with a prescription issued by an appropriate practitioner.

We also consider that the joint acts of both the hub and the spoke should be treated as the final retail sale or supply of the medicinal product.

2. Movement of assembled or part-assembled medicines from the spoke to the hub without the need for a wholesale dealer license in models 1 and 2

We intend to amend the HMRs so that the spoke will be able to send assembled or part-assembled medicinal products to the hub, where that assembly will be completed, without the need for a wholesaler dealer license.

Currently, this movement of medicines would be classed as wholesale dealing and the spoke would require a wholesale dealer license to be able to lawfully carry out this transaction.

We intend to amend the HMRs so that this movement of part-assembled or assembled medicines will also be classified as a ‘deemed retail sale’, hence the spoke will not require a wholesale dealer license to be able to lawfully carry out this transaction.

Again, we consider that the joint acts of both the hub and the spoke should be treated as the final retail sale or supply of the medicinal product.

3. Ensuring that the hub and the spoke are both registered pharmacies (with the exception of dispensing doctors)

Under the HMRs, a ‘retail pharmacy business’ is a business which consists of or includes the retail sale of medicinal products that are not subject to general sale.

Therefore, we consider, that for a business to be able to register as a pharmacy business, a part of that business must include the retail sale of medicinal products that are either classified as pharmacy medicines (‘P’) or prescription only medicines (‘POM’).

Subsequently, by deeming that the movement of medicinal products between the hub and the spoke in model 1 is a ‘retail sale’, we are ensuring that the hub must be a retail pharmacy business.

Also, in model 2, by deeming that the retail sale of medicinal products between the hub and the patient is also a ‘parallel retail sale’ between the spoke and the patient, we are ensuring that the spoke must be a retail pharmacy business.

We intend to amend the HMRs so that a dispensing doctor will be able to utilise the hub and spoke arrangements in a way that they too can benefit from the ‘deemed retail sales’ but without being considered a retail pharmacy business.

4. Ensuring end to end regulatory oversight for the hub and spoke dispensing models

As a consequence of deeming the specified transactions in models 1 and 2 to be a retail or a parallel retail sale, we are of the view that we are ensuring that the hub and the spoke must both always be a retail pharmacy business (with the exception of a dispensing doctor who may act as a spoke). As a consequence of this, there will be end-to-end regulatory oversight of the hub and spoke models, as registered pharmacies are regulated by the General Pharmaceutical Council (GPhC) in Great Britain. In Northern Ireland, the Medicines Regulatory Group (which is part of the Department of Health) have powers to inspect pharmacies against published standards. PSNI have the ability to take regulatory action to address individual conduct issues for registered pharmacists raised in relation to fitness to practice.

Regulatory provisions vary across the devolved administrations where a dispensing doctor acts as a spoke - for detail of how end-to-end regulatory oversight will work in these circumstances, see ‘Access for dispensing doctors to hub and spoke’ in section 5, ‘Changes to the HMRs to ensure patient safety, governance, transparency, accountability and access for dispensing doctors’.

5. Professional responsibility and accountability

A consequence of deeming the specified transactions in models 1 and 2 to be a retail or a parallel retail sale is that the hub and the spoke must both be a retail pharmacy business (with the exception of dispensing doctors, who may also act as a spoke), as discussed above. In order for a retail pharmacy business to be operating lawfully there must be a responsible pharmacist at those premises who is responsible for the safe and effective running of that business. This means that there must be a responsible pharmacist at both the hub and the spoke. Pharmacists are governed and regulated by GPhC in Great Britain and PSNI in Northern Ireland and are individually accountable for meeting the required standards set by those regulatory bodies. The pharmacist at the spoke and the pharmacist at the hub would be professionally responsible and accountable for their own actions and for the actions of the staff that they supervise. This would include being responsible for any activities that they have either taken part in or have supervised in relation to the assembly of a medicinal product. The same is true of a dispensing doctor, who would be regulated by the GMC. In addition, as a healthcare professional, the pharmacist or dispensing doctor would be expected to use due diligence where reasonable, to correct an obvious mistake, even if, for example, it was an error in an activity that they were not responsible for.

The following diagrams seek to demonstrate how these new types of retail sales will apply when the proposed hub and spoke models are in place between spokes and hubs that belong to different legal entities.

Figure 1: model 1 - where the hub prepares or assembles part or all of the prescription before moving it back to the spoke, for the spoke to supply the complete prescription to the patient

Text explanation for Figure 1

Figure 1 is a process diagram which starts with the patient either bringing their prescription to, or having their prescription sent to, the spoke (which can be either a retail pharmacy business or a dispensing doctor). Depending on the written arrangements between the parties, certain dispensing activities may be carried out at the spoke, for example, the clinical check of the prescription. Once those activities have been completed, the spoke sends the necessary patient or prescription data to the hub by secure digital means. The hub, in accordance with the written arrangements, then assembles part of or all (as the case may be) of the prescription, before moving those assembled medicines back to the spoke.

The new draft regulations propose that this movement of medicines between the hub and the spoke is a retail sale and not wholesale dealing. If the hub has only part-assembled the prescription, the spoke has an opportunity to complete the assembly of all items listed on the prescription at this point. Once all checks and assembly are complete, the spoke supplies medicines to the patient. This act of final supply is a retail sale between the spoke and the patient. The NHS pays the spoke the fee for dispensing the medicines and reimburses the spoke the total cost for the medicines supplied as set out in the Drug Tariff.

Figure 2: model 1 - where the spoke moves prepared or assembled medicine to the hub and the hub prepares or assembles the complete prescription, then moves it back to the spoke, for the spoke to supply the complete prescription to the patient

Text explanation for Figure 2

Figure 2 is a process diagram which starts with the patient either bringing their prescription to, or having their prescription sent to, the spoke (which can be either a retail pharmacy business or a dispensing doctor). Depending on the written arrangements between the parties, certain activities may be carried out at the spoke, for example, the clinical check of the prescription. Once those activities have been completed, the spoke sends the necessary patient or prescription data to the hub by secure digital means. The hub, in accordance with the written arrangements, then assembles the prescription.

The fundamental difference here to the process outlined in Figure 1 is that, should the need arise, the spoke can assemble some medicines ordered on the prescription and send those assembled medicines to the hub, where the hub can complete the order with other items listed on the prescription.

The new draft regulations propose that this movement of assembled medicines from the spoke to the hub in these specific instances is a retail sale and not wholesale dealing. The completed order is moved from the hub back to the spoke, the new regulations proposing that this movement of medicines from the hub to the spoke is part of a retail sale and not wholesale dealing. The completed prescription is then supplied by the spoke to the patient. This act of final supply is a retail sale from the spoke to the patient. The NHS pays the spoke the fee for dispensing the medicines and reimburses the spoke the total cost of the medicines supplied as set out in the Drug Tariff.

Figure 3: model 2 - where the hub prepares or assembles all of the prescription and also supplies it to the patient

Text explanation for Figure 3

Figure 3 is a process diagram which starts with the patient either bringing their prescription to, or having their prescription delivered to, the spoke (which can be either a retail pharmacy business or a dispensing doctor). Depending on the written arrangements between the parties, certain activities may be carried out at the spoke, for example, the clinical check of the prescription. Once those activities have been completed, the spoke sends the necessary patient or prescription data to the hub by secure digital means. The hub, in accordance with the written arrangements, then assembles the order.

The hub then supplies the completed order directly to the patient. This act of final supply is a retail sale between the hub and the patient. At the same time, the regulations propose that a ‘parallel retail sale’ is created between the spoke and the patient. The NHS pays the spoke the fee for dispensing the medicines and reimburses the spoke the total cost of the medicines supplied as set out in the Drug Tariff.

Figure 4: model 2 - where the spoke moves assembled or part-assembled medicine to the hub and the hub undertakes dispensing activity before supplying it to the patient, so completing the dispensing of the prescription

Text explanation for Figure 4

Figure 4 is a process diagram which starts with the patient either bringing their prescription to, or having their prescription delivered to, the spoke (which can be either a retail pharmacy business or a dispensing doctor). Depending on the written arrangements between the parties, certain activities may be carried out at the spoke, for example, the clinical check of the prescription. Once those activities have been completed, the spoke sends the necessary patient or prescription data to the hub by secure digital means. The hub, in accordance with the written arrangements, then assembles the order.

The fundamental difference here to the process in Figure 3 is that, should the need arise, the spoke can assemble part of the order and send that part of the order to the hub, where the hub can complete it. The new draft regulations propose that this movement of assembled medicines from the spoke to the hub in these specific instances is a retail sale and not wholesale dealing.

The hub then supplies the completed order according to the prescription directly to the patient. This act of final supply is a retail sale between the hub and the patient. At the same time, the draft regulations propose that a ‘parallel retail sale’ is created between the spoke and the patient. The NHS pays the spoke the fee for dispensing the medicines and reimburses the total cost of the medicines supplied as set out in the Drug Tariff.

Annex B: details about the respondents to the consultation

Online survey

In total there were 131 responses, of which:

• 71 were responses from individuals
• 60 were respones from organisations

Information about the 71 individuals who participated

Table 1: age

What is your age?	Respondents
16 to 24	1
25 to 34	8
35 to 44	21
45 to 54	20
55 to 64	11
65 to 74	7
Prefer not to say	3
Total	71

Table 2: disability

Do you consider yourself to be disabled?	Respondents
No	68
Yes	2
Blank	1
Total	71

Table 3: long-term health conditions

Do you have a long-term condition?	Respondents
No	56
Yes	15
Total	71

Table 4: location in the UK

Where do you live in the UK?	Respondents
England	59
Northern Ireland	6
Scotland	1
Wales	5
Total	71

Table 5: area of England

Which area of England do you live in?	Respondents
East Midlands	4
East of England	5
London	10
North East England	3
North West England	11
Prefer not to say	2
South East England	6
South West England	10
West Midlands	4
Yorkshire and the Humber	4
Total	59

Characteristics of organisations

Table 6: categories and size of pharmacy businesses represented as at June 2022

Category of business	Number of stores in chain	Number of pharmacy businesses by category who responded	England only	Scotland only	Wales only	Northern Ireland only	UK-wide
Independents	1	9	8	0	0	1	0
Small chain	2 to 5	3	3	0	0	0	0
Larger chain	6 to 20	4	4	0	0	0	0
Small multiple	21 to 100	1	0	0	0	1	0
Medium multiple	101 to 500	2	2	0	0	0	0
Large multiple	501-plus	3	0	0	0	0	3
Total		22	17	0	0	2	3

Note: it is possible that some respondents who submitted their evidence as an individual may also be independent pharmacy business owners. If so, they are not included in this table as we did not ask individuals to specify the nature of their interest or role.

In addition to retail pharmacies, organisations that participated included DSPs, distribution specialists, hub providers, an integrated healthcare provider, local pharmaceutical committees, membership organisations, national representative bodies, pharmaceutical wholesalers, professional advisory bodies, a professional leadership body, regulators, trade associations and a trade union.

Stakeholder workshops

We invited 101 stakeholders to attend the stakeholder workshop in December 2022. They included representatives from:

• government across England and the devolved administrations
• hub providers, integrated healthcare providers, companies providing management and technology solutions
• membership organisations
• NHS providers and national representative bodies
• pharmaceutical wholesalers
• regulators
• trade associations
• trade unions
• pharmacies, including small multiples, medium multiples, large multiples and DSPs

Annex C: respondent views on contents of the written arrangements between hub and spoke

Some respondents shared the following information as good practice for businesses thinking about developing their own agreement.

One respondent advised that for their current hub and spoke models (within the same legal entity), their arrangement is that:

• the data entry and submission to the hub is the responsibility of the responsible pharmacist at the spoke
• the assembly of the prescription based on the data sent through from the spoke is the responsibility of the responsible pharmacist at the hub
• organisation for the transport of completed orders back to the spoke is the responsibility of the responsible pharmacist at the hub
• the handout of the assembled medication to the patient is the responsibility of the responsible pharmacist at the spoke

A range of respondents suggested that the following topics should be covered in the written arrangements.

Responsibilities, including:

• responsibilities at each stage of the dispensing process
• clinical and accuracy accountabilities
• liabilities identifying the key risks to patients at each stage of the dispensing process
• delivery
• details of inspection regimes for hubs and spokes

Data on patient safety, including:

• number of patients per pharmacist
• patient contact
• how any interventions will be carried out, recorded and managed
• supervision
• arrangements to control quality of unlicensed medicine
• controlled drugs
• failure to supply
• femperature management standards

Data on workforce training.

Data sharing, including:

• UK GDPR breaches and the sharing of data
• transparency of error rates