THE HEAD OF the Irish Pharmacy Union has warned of major job losses in Irish pharmacies as they struggle to compete with Tesco, which opened its first two pharmacies here this week.

Darragh O’Loughlin said that Irish independent pharmacies already compete on price as much as they can, and that job losses “may be inevitable”.

However the move has been welcomed by the National Consumer Agency which said it will lead to lower prices for the consumer.

Tesco opened its first Irish pharmacies in Naas, Co Kildare and Balbriggan in Dublin this week, and is due to open eight more in-store pharmacies over the next two to three years.

Over 1,600 jobs have already been lost in pharmacies over the past two years due to the recession, the downturn in retail sales, and cuts in state payments to pharmacies, Darragh O’Loughlin told TheJournal.ie.

“In areas where Tesco pharmacies locate, the independent pharmacies located close to them will struggle. We can see this already in the UK, where a significant number of local pharmacies closed when a chain pharmacy moved in.”

The new Tesco pharmacies are expected to significantly undercut other pharmacies by charging a lower-than-average mark-up of 20 per cent on prescription drugs – as recommended by the HSE but ignored by many pharmacists. They will also charge a dispensing fee of €3.50 per item which is €1.50 less than the fee suggested by the HSE.

O’Loughlin argues that independent pharmacies already have very narrow profit margins of just 4 per cent on average and that the issue is about competing on service as well as price.

“Prices can appear expensive because people tend to go on holidays to Spain or city breaks to the UK and buy cheaper drugs there. However Irish prices are around the European average.”

Ann Fitzgerald, the head of the National Consumer Agency, welcomed the move which should lead to lower prices for consumers. She told TheJournal.ie:

The NCA has been been concerned for some time about the lack of transparency in relation to the prices of drugs in Ireland. The Agency has also published an analysis of price comparisons of over the counter pharmacy products and continually advises consumers to shop around, if possible, to achieve best value.