Welcome to Part 1 on how to set up a pharmacy without falling into the common legal pitfalls. Let’s say you have your own pharmacy and the business has grown substantially in recent years, thanks to your dedication to excellent customer service and the provision of the best quality advice and medication.
Fortuitously, the town has also grown and you see an emerging need for a new pharmacy to service the expanding outer suburbs – residents of these suburbs really have to make a trek if they want to reach the nearest supermarket or your pharmacy.
When you set up a pharmacy, or consider relocating or re-sizing a pharmacy, it is very different to changing a regular business. Pharmacies and pharmaceutical services in Australia are heavily regulated to ensure that the service and healthcare of Australians is maintained at a high level. Whenever you wish to change your pharmacy, you need to comply with the rules to avoid penalties or having your approval to operate a pharmacy cancelled.
Are you an approved pharmacist?
Approved pharmacists are permitted to expand or contract, relocate or establish a new pharmacy, providing she or he meets certain requirements. To become an approved pharmacist, an application must be made under section 90 of the National Health Act 1953 (Cth). Once you are an approved pharmacist, you are permitted to distribute pharmaceutical benefits (these are drugs or medicinal preparations for which benefits will be paid by the Commonwealth).
The Australian Community Pharmacy Authority (ACPA) recommends pharmacy approval applications and applications to expand or contract, or relocate or establish new pharmacies. ACPA meets monthly and can either recommend or not recommend an application be submitted for consideration.
The Pharmacy Location Rules
The Pharmacy Location Rules are going to be your best friend when you apply to change the size of your pharmacy, or to relocate or establish a new pharmacy. The Pharmacy Location Rules are a crucial part of the Sixth Community Pharmacy Agreement. This Agreement is a contract between the Commonwealth of Australia and the Pharmacy Guild of Australia. The Sixth Agreement came into force on 1 July 2015 and will last until 30 June 2020, when a new Agreement will be formed.
The Pharmacy Location Rules and You – General Requirements
When you submit an application to ACPA to change the size of your pharmacy, or relocate or establish a new pharmacy, there are a number of general requirements that you need to comply with to ensure your application is given the best chance of success.
You must satisfy ACPA that:
- on the day the application was made, the proposed premises could be used for the operation of a pharmacy under local government and state or territory laws relating to land development and will be accessible to members of the public at large;
- within six months after the day on which ACPA makes a recommendation in relation to the application, that the applicant will be able to begin operating a pharmacy at the proposed premises;
- the proposed premises are not directly accessible by the public from within a supermarket.
You must use an Applying for Approval to Supply Pharmaceutical benefits at a Particular Premises form (PB009) to make an application to either:
- change the size of your pharmacy;
- relocate an existing pharmacy (without a change in ownership); or
- establish a new pharmacy.
Expanding or Down-sizing your Pharmacy Business (Rule 121)
In two months, the store next door to your pharmacy will be available to lease. Your pharmacy is doing well and you need space to expand. Before you take the leap and the lease, make sure you understand the additional obligations you must meet before expanding.
An application for expansion or contraction must be an application for an expansion or contraction of pharmacy premises, in which the proposed premises will occupy any of the space occupied by the existing premises.
Relocating an Approved Pharmacy Business
Relocating within the same facility (rule 122): if you are relocating your pharmacy business within the same facility (such as a shopping mall) you need to demonstrate that both the existing premises and the proposed premises are in the same facility.
Relocation within the same town – 10km (rule 123): to relocate within the same town, the proposed premises must be in the same town as the existing premises and the proposed premises are at least 10km by shortest lawful access route, from the nearest approved pharmacy, other than the existing premises.
Short distance relocation – 1km (rule 124): your proposed premises must be no more than 1km by straight line, from the existing premises. In addition, the existing premises must not be in a facility or the existing premises are in a facility and the proposed premises are at least 500m in a straight line, from all approved premises not located in the facility.
If you need help drafting any of your applications or legal documents when you set up a pharmacy of your own, LegalVision’s business lawyers can help. Get in touch today at 1300 544 755 to get a fixed-fee quote!