Legislations on pharmacy

The OFT has said that the current licence system restricts consumer choice and inflates prices of over-the-counter medicines, resulting in Britons paying 30 million pounds more for drugs than they would in a deregulated maret. The DTI is expected to go some way towards opening up the market, however, by allowing health authorities to offer more pharmacy licences to create competition and bring down the cost of medicines, which could allow the supermarket chains to open some new in-store outlets. Industry analysts have said the Boots, whose shops are mostly in high street locations, would be most vulnerable to supermarket competition. Britain rejects calls for a full deregulation of its retail pharmacy industry, a government source told Reuters, in a blow to supermarkets such as Tesco plc and Asda. The OFT proposed to open up its 8.6billion pound market for prescription and over-the-counter medicines and remove restrictions which protect the market share of companies such as Boots and Alliance UniChem. This plan would allow big supermarket chains, which have been lobbying the government for easier access to the market for years, to take a bigger share of Britainбпs medicine market.

On the side of pharmaceutical retailing, the competition is expected to be intensive. Current licence system restricts consumer choice and inflates prices of OTC medicines, resulting in Britons paying 30 million pounds more for drugs than they would in a deregulated market. The DTI is expected to go some way towards opening up the market by allowing health authorities to offer more pharmacy licences to create competition and bring down the cost of medicines, which could allow the big supermarket chains to open some new in-store outlets, hence take a bigger share of Britainбпs medicine market.. If this proposal is accepted, Boots plc, whose shops are mostly in high street locations, would be most vulnerable to supermarket competition. (boots has been protected by the current licence system for years and this advantage is expected to disappeared in a long run) . Evidence shows that when markets are deregulated the strongest player before deregulation usually remains the strongest player. Supermarkets have just 3.9% of pharmacy outlets

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