The Pharmacy Council has functions under Schedule 5F of the Health Practitioner Regulation National Law (National Law) which includes approving the registration of financial interests (ownership) of pharmacy businesses operating in NSW. Part of this function involves the review of agreements and arrangements between pharmacy owners or financial interest holders with third parties to ensure compliance with Schedule 5F of the National Law, especially with regard to conferral of financial interests to third parties.
What is financial interest in a pharmacy business?
Financial interest is defined widely in the National Law and can include direct or indirect monetary or financial interest which could exist by way of an individual holding the role of a director in a body corporate. Conferral of financial interest may occur in a number of other ways outside of the “examples” in the definition in clause 2 of Schedule 5F and are often unintended. A conferral of financial interest could result from clauses in agreements or arrangements that benefit a third party with reference to the turnover or profit of the pharmacy business, for instance a lease which contains a turnover or percentage rent clause.
Who can hold a financial interest in a pharmacy business and what are my obligations if I hold a financial interest?
As you are aware, under clause 5 of Schedule 5F of the National Law, ownership of pharmacy businesses in NSW is only limited to pharmacists, partnerships of pharmacists and pharmacists’ body corporates, with some very limited exceptions (Friendly Societies with Ministerial approval). Pharmacy business is more than just the dispensing of prescriptions and includes other parts of that business that the pharmacist chooses to include within its scope including the sale of non-pharmaceutical products. Individuals or entities who hold a financial interest when they are not permitted to do so under the National Law, can be prosecuted under the National Law.
All financial interests in a pharmacy business must be registered with the Council. An individual or entity may be entitled to hold a financial interest but a failure to register the financial interest with Council is an offence that is prosecutable under the National Law.
How are agreements and arrangements assessed?
Each application for registration of a financial interest will be assessed to determine compliance with the National Law.
If documentation lodged with Council indicates that there are any contraventions of the National Law, for instance a conferral of a financial interest to a third party (intended or otherwise), amendments will be sought to the documents to ensure compliance or the application may be refused. This information should be brought to your legal representative’s attention as non-compliance may cause a delay in progressing your application.
Request for further information
Please be aware that Council can also require persons to supply such information and/or documents if it decides it is relevant to any financial interest(s) held by the person in a pharmacy (Schedule 5F, clause 16 of the Law). Failure to supply the information/documents or knowingly furnishing false information/documents is an offence under the National Law.