Does deregulation of pharmacies mean cheaper prices across the counter? This week's pullout by German giant Gehe from a deal to buy the Unicare chain suggests it will, writes Padraig O'Morain.
So far it's been a rotten spring for the Irish Pharmaceutical Union. As the country shivers in icy rain and freezing winds, its members feel that they have been left well and truly out in the cold by the Government.
Not only did the last day of winter bring sudden deregulation of where pharmacies can open but this week's collapse of the €152.4 million buyout of the Unicare chain by Gehe suggests deregulation is good for consumers - as least as far as prices go.
Only six years ago the then Minister for Health, Michael Noonan, gave the IPU what outsiders would regard as a dream deal. It meant that anyone who wanted to open a pharmacy which handled medical card prescriptions had to get permission from their regional health board.
The health board was obliged to consider whether there was a definite public health need for the pharmacy and whether existing pharmacies - even in other towns - might be affected.
The IPU saw this deal as heading off a nightmare scenario. In that scenario, in the absence of regulation, big chains (like Gehe) take over the pharmacy retail business, cherry-picking their locations and driving independent pharmacists out of business.
Quality of service to the consumer suffers and prices rise.
Regulation, it argued, ensured a more rational spread of pharmacies and kept prices down. Many towns, it argued, subsequently got pharmacies which would not have got them without regulation.
These arguments cut no ice with critics such as the Competition Authority or the Consumers' Association. They pointed to towns like Knock, Co Mayo, denied a pharmacy despite the huge number of pilgrims who throng its streets in the summer. Another example is Prosperous, Co Kildare - ironically a four-year appeal process led to permission being granted for a pharmacy in the village just as deregulation was introduced.
Restrictions on the location of pharmacies protected the inefficient, the Competition Authority argued. The Consumers' Association argued that they amounted to a cartel for pre-1996 pharmacists who could charge higher prices.
Critics also complained that the restrictions drove up the value of existing pharmacies, bringing big windfalls to their owners. The IPU argued this was just part of the general rise in property prices.
Last year the OECD weighed in with criticism of Ireland's regulations of pharmacies and Mary Harney promised to act on the OECD's views.
BUT there were positives, too, from the IPU viewpoint. The Minister for Health and Children, Micheál Martin, defended the regulations in the Dáil. A group was set up to review the regulations and the IPU hoped to hold the line on the group while conceding that some change was needed. As time went on there seemed to be a fighting chance that the review group would not have completed its work before a general election.
The bombshell came on January 31st when the Minister announced that, following advice from the Attorney General, Michael McDowell, he had ended the restrictions.
Pharmacists were outraged. The IPU's president, Limerick pharmacist Marie Hogan, lambasted the Minister for giving us the most unregulated pharmacy sector in Europe.
She and her colleagues were particularly angry that the Minister had made his decision before the review group had completed its work.
The IPU is fighting back with a poster campaign in pharmacies. Using the slogan Prescription for Disaster, it focuses on fears that deregulation will mean local pharmacies being bought and possibly closed by "profit-driven, multinational conglomerates". It quotes Mr Martin's one-time support for the 1996 regulations. "He knows and has acknowledged that it will have minimum impact on prices," it declares. "The same Minister knows that he will deprive, by his actions, some of the most vulnerable in our communities of ready access to an essential health service."
The IPU has also said it will take legal action to challenge the deregulation, that it will not take on new methadone patients and that it will flood the GMS Payments Board (which pays pharmacists under the medical card scheme) with paperwork.
These actions, it seems safe to say, have not led the public to skip a pulse beat. The poster campaign, however, is different. In emphasising the vulnerability of local pharmacists and the danger of higher prices it stands a good chance of striking a chord with customers.
For that reason, the Gehe pullout could not have come at a worse time. Gehe, after all, is one of those "profit-driven, multinational conglomerates" which the IPU says will flourish under deregulation.
It is clear from Gehe's comments that its motivation for pulling out of the deal to buy the Unicare chain is based on the assessment that deregulation means it could not make as much profit as it thought it could make in a regulated market.
What that in turn seems to mean is that deregulation strengthens the position of local pharmacies, will allow more of them to open and will bring lower prices to consumers.
The fight is far from over - the IPU is a highly professional and effective organisation - but the implications of Gehe's move have dealt its cause a body blow.