The Healthcare Distribution Association (HDA) has developed an updated call-to-action for the new Andy Burnham led Government outlining steps it can take to support the effective distribution of medicines in the UK.
The trade body of pharmaceutical wholesalers has said the successive government's decisions on business rates, national minimum wage and national insurance have led to a rise in operating costs for its members.
This has been further aggravated by the recent crisis in Iran and resultant double-digit surge in fuel costs, as it operates more than 3,500 delivery vehicles to every part of the UK.
The HDA said its members already operate on incredibly thin margins within a constrained NHS funding environment and they alone cannot bear these unforeseen and significant increases in operating costs.
It has urged the new government to implement four actions within its first 100 days to improve the viability of this sector.
Super-deduction
Introduction of a capital expenditure super-deduction, to unlock further investment in supply chain resilience by our members. Without sustained assistance, the unforeseen and significant increase in fuel costs and broader cost inflationary environment are likely to threaten the overall resilience of the supply chain in the short and mid-term.
Tax system update
Expansion of vehicle excise duty (VED) relief beyond HGVs to include vehicles operated by medicines wholesalers possessing a WDA(H) licence. HDA analysis predicts an expansion to this relief would cost the Government just £1 million, a very low price for the benefit it will yield.
Additionally, companies responsible for medicines distribution should be treated as a special case during further reforms of business rates and must not conflated with other warehouse-based sectors who do not provide life-saving treatments for high-street pharmacies, patients and the NHS. As such, any introduction of higher business rates on super-warehouses should include a carve-out for WDA(H) holders.
Green grants
Greater incentives and financial support for healthcare distributors to better enable the transition to Net Zero, including prioritised access to EV charging and the introduction of PV infrastructure grants. Any further Government grants should include specific and ringfenced provisions for medicine wholesalers to ensure they are adequately supported during the transition.
NHS debt protection
Mandate NHS hospitals and trusts to pay for medicines in a timely manner as required under the terms of the Better Payment Practice Code (BPPC) which mandates all NHS organisations pay valid, undisputed supplier invoices by the due date or within 30 days of receipt, whichever is later.
Despite this, secondary care debt owed to HDA members reached £43.5 million in January 2026 with some NHS Trusts consistently failing their BPPC obligations. HDA members operate on increasingly thin margins therefore if invoices continue to remain unpaid, the financial viability of supplying and delivering NHS trusts may need to be reconsidered until debts are cleared.
In primary care, Government must provide the same debt underwriting and backing to pharmacies and GPs as is currently applied to NHS trusts to ensure medicine wholesalers are not left out of pocket should these primary care facilities go out of business.
The trade body said these actions are crucial to revitalise the medicines distribution sector and ensure that the UK retains its sustainable healthcare system.
HDA represents all leading companies that provide pharmaceutical wholesaling services across the UK and deliver 95% of medicines for the NHS.
