Key Summary
- In the Drug Tariff Category M pricelist for January 2026, NHSBSA claims there has been an over delivery of £158 million at the end of June 2025
- The medicine margin adjustment applied to January 2026 is a reduction of £16.8 million per quarter
- Picard said this clawback "quietly slipped out just before Christmas" will hit pharmacies hard
National Pharmacy Association chair Olivier Picard has denounced the NHS's plan to recoup hundreds of millions of pounds from pharmacy owners, stating that this would exacerbate the sector's existing woes.
He was referring to the Drug Tariff Category M pricelist for January 2026, published by the NHS Business Services Authority (NHSBSA) on its website.
The NHSBSA stated, "The latest results from the quarterly Medicines Margin Survey indicate a total cumulative over delivery of £158 million at the end of June 2025.
"As per the Community Pharmacy Contractual Framework (CPCF) settlement 2024/25 and 2025/26, any over-delivery of medicine margin will be recouped over the following 12 months.
"In light of the latest medicine margin survey results, the medicine margin adjustment applied to January 2026 is a reduction of £16.8 million per quarter. This will be applied across Categories M and A (approximately half of the total from Category A and half from Category M)."
Calling this a "bombshell Christmas move", Picard said, “It’s appalling that the NHS is proposing to claw back millions of pounds each month from pharmacy budgets under an opaque formula, quietly slipped out just before Christmas, that will hit pharmacies indiscriminately.
"This comes less than a year after the government stood up in April 2025, claiming it was ‘investing in community pharmacy’ and that this was the first step towards sustainability. What we are seeing now directly contradicts those assurances."
Picard said there is a disconnect between the government's rhetoric and the real-world problems faced by pharmacies, and the current drug tariff and pharmacy contracts remain underfunded and broken.
“Pharmacies are left unable to predict, even week to week, what their funding will be. That level of uncertainty is damaging and can only hold back the reform the Government rightly wants to see.
“That means pharmacies cannot plan, cannot invest, and are forced to dispense NHS medicines, day after day, often at a loss, with little idea of whether they will be reimbursed adequately. No other part of the NHS would be expected to operate like this.
“That’s no way to run a business, and it is absolutely no way to run an essential public health service. It’s time for the Government urgently to commit to genuine contract reform that funds medicines supply sustainably, gives pharmacies confidence to invest and aligns words with actions if ministers are serious about transforming community healthcare.”
Unviable prices: CPE
The Community Pharmacy England (CPE) had earlier expressed concern over the NHSBSA price list and said several products were being reimbursed at "economically unviable prices".
"The NHS focus on low prices over stability of supply continues to drive disruptions in availability, leading to hundreds of products requiring emergency concession status, and putting patients’ access to medicines at risk.
"Further reductions in reimbursement prices will only exacerbate these issues."
The CPE, however, said it was seeking more details from DHSC around the adjustments made to the January drug tariff.
