UK: Market Entry 2012

Last Updated: 29 November 2011
Article by David Reissner

The Department of Health has at long last published draft regulations that are intended to govern the grant or refusal of applications for NHS pharmacy contracts from an unspecified date in 2012. The expression "control of entry" will be replaced by "market entry", and there will also be rules for market exit.

The draft Regulations are extremely complicated, although the Department has also published guidance.

Here is our simplified guide to the key features:

Legal advice and representation

The application process will be much more complex, justifying the decision to allow legal representation at PCT hearings – so good news for lawyers!

Routine or exempt

  • There will be routine applications and exempt applications
  • There will be no more exemptions for 100-hour pharmacies or pharmacies at onestop primary care centres or large retail parks.
  • 100-hour pharmacies will have to continue to provide services for 100 hours a week and PCTs will not be permitted to change this.

In the PNA or not? Present or future?

  • Routine applications will have to spell out whether they are intended to - meet a present or future need or fill a gap in services referred to in the local Pharmaceutical Needs Assessment
  • or secure improvements or better access to services listed in the PNA
  • or secure improvements or better access to services that were not foreseen when the PNA was drawn up
  • Applications that would meet an identified present or future need will not necessarily be granted, because the PCT must have regard to various other factors such as:
  • Whether to consider or invite other applications
  • Changes since the PNA was published
  • In the case of future needs, the PCT may make a grant conditional on the occurrence of a future event

If not in the PNA ...

  • Applications made on the basis that they would provide improvements or better access to services that were not foreseen in a PNA will also have to confer a significant benefits on people in the area.
  • But if an application is intended to provide improvements or better access to services not mentioned in the PNA, there are further factors the PCT must take into account, such as
  • Whether granting the application would cause significant detriment to proper planning of pharmaceutical provision (in which case the application must be refused)
  • Whether there would be significant detriment to existing arrangements (in which case, the application must be refused)
  • The desirability of reasonable choice
  • The desirability of innovative approaches regarding the delivery of services.

English language and European pharmacists

  • All applications by pharmacists who have qualified in Switzerland or elsewhere in the EEA must be refused unless the applicant satisfies the PCT that he or she has a "level of knowledge of English ...necessary for the provision of services".
  • It seems ironic that the language requirement is proposed just as the Department of Health finally changed the Medicines Act to lift the ban on European-qualified pharmacists acting as responsible pharmacists in pharmacies that have been registered for fewer than 3 years.


A routine application that does not meet a current or future need identified in the PNA or secure improvements or better access to services the benefits of which were not foreseen in the PNA, the application must be refused.

Preliminary consent and conditional grant

  • There is no longer a right to apply for preliminary consent, but, an applicant may apply for a conditional grant if s/he was only able to provide in the application a best estimate of where the proposed premises would be (not the address). If granted, the applicant must notify the PCT of the address within 6 months of the date on which the decision was sent or, within 6 months of an appeal decision.
  • The 6-month period cannot be extended, and a grant will lapse if the condition is not satisfied.
  • The PCT must notify the applicant within 14 days whether it is satisfied that the notification is valid


The concept of minor relocation will disappear, as will arguments over neighbourhood definitions. Relocations will be a form of exempt application and will be granted if:

  • Patients accustomed to accessing the existing pharmacy, the new location would not be significantly less accessible and
  • There would not be a significant change to existing arrangements for the provision of services; and
  • Granting would not cause significant detriment to proper planning in respect of the provision of pharmaceutical services in the area; and
  • The same services (including enhanced and advanced) will be provided; and
  • There will be no interruption in services

Distance selling exemption

Internet/mail order pharmacies will remain be exempt from the market entry test, but in addition to the existing rules:

  • applications must be refused unless there is uninterrupted provision during opening hours (so the responsible pharmacist may have to be present the whole time)
  • applications must be refused unless the PCT is satisfied there will be "safe and effective provision of essential services without face to face contact between any person receiving the services and the applicant or the applicant's staff".

Change of ownership

Changes of ownership should be simpler in some respects and there will be new arrangements for a purchaser who wants to relocate after completing a purchase.

Refusal – adjacent premises

  • Like the current rules, an application must be refused if the premises are the same or adjacent to premises where services are being provided and it is reasonable to treat the proposed services as part of the same service as the existing services (on the basis that the existing premises and proposed premises "should be treated as the same site").
  • If premises are adjacent to or "in close proximity to" an existing pharmacy, the applicant must include with the application an explanation why the application should not be refused.

Processing applications

  • PCTs will have express power to ask for information or documents.
  • Applicants can ask for a review of the request and can ask for more time to comply.
  • If the applicant does not comply, the application is to be treated as withdrawn
  • Because of the restricted rights of appeal for objectors (see below), legal advice should be sought before making written representations to the PCT

PCT oral hearings

In view of the complexity of the Regulations, they will sensibly permit legal representation at PCT hearings for the first time.


Applicants will have an unfettered right of appeal against the refusal of applications, but objectors will only have a right of appeal against a grant if the decides objectors satisfy a complex criteria. Legal advice will be essential.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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David Reissner
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