Under section 90 of the National Health Act 1953 (Cth) (‘the Act’), the Secretary of the Department of Health has the power to approve or reject a registered pharmacist’s application to supply pharmaceutical benefits at particular premises. This means that the Secretary can decide who can and who cannot operate a pharmacy.

The pharmacy location rules (‘the Rules’) set out the location-specific criteria that registered pharmacists must meet to obtain the Secretary’s approval. The Rules came into effect on the 18 October 2011 and are detailed in the Pharmacy Location Rules Applicants Handbook Version 1.2, November 2015 (‘the Handbook’). State and territory legislation continue to apply, and as such, the Rules do not provide an exhaustive list of the pre-requisite criteria that must be satisfied.

The Secretary can only approve an application if the Australian Community Pharmacy Authority (‘the Authority’) approves it first. The Authority was established under the Act to consider applications for the establishment and relocation of pharmacies. The Authority is charged with making recommendations to the Secretary as to whether an application should be approved or rejected.

1. Applying for Approval

Only a registered pharmacist can own and operate a pharmacy.

To become a registered pharmacist, you must lodge an application with the Pharmacy Board of Australia. A registered pharmacist has the right to apply to the Authority to become PBS approved. The primary benefit of obtaining PBS approval is that the pharmacist can supply pharmaceuticals under the PBS scheme and thereby become eligible to receive payments from the Federal Government. A pharmacist who fails to obtain approval from the Authority may not qualify for such payments. Although, if a pharmacist does not intend to supply pharmaceutical benefits or obtain government payments, they don’t need to seek approval. In fact, it is possible to operate an unapproved Pharmacy as a registered pharmacist (without PBS approval).

Applications for the approval and relocation of a PBS pharmacy must be made using the approved application form, namely “Applying for Approval to Supply Pharmaceutical Benefits at a Particular Premises” (form PB009).

Per the Rules, applicants must submit certain accompanying documentation, evidence and summaries along with the prescribed form. The form and the supporting evidence when collated comprise an assessable and complete “application”. The complete application must be lodged with the Department of Human Services via email at nsw.pbs.approval.clerk@humanservices.gov.au.

2. Nominate a Rule

The Handbook contains some categories for the establishment and relocation of a new pharmacy. At the outset, an applicant must nominate a category. It is not the Authority’s nor the Secretary’s role to ensure that an applicant nominates the correct category. In deciding which category to seek approval under, you should take a common sense approach. That is, choose the category most descriptive of the intended course of action.

When seeking to establish a new PBS pharmacy, the relevant categories are as follows:

  • Rule 130: New pharmacy (1.5 km);
  • Rule 131: New pharmacy (at least 10 km);
  • Rule 132: New additional pharmacy (at least 10 km);
  • Rule 133: New pharmacy in a facility (small shopping centre);
  • Rule 134: New pharmacy in a facility (large shopping centre);
  • Rule 135: New pharmacy in a facility (large private hospital); and
  • Rule 136: New pharmacy in a facility (large medical centre).

When seeking to relocate an existing PBS pharmacy, the relevant categories are as follows:

  • Rule 122: Relocation within a facility (small shopping centre, large shopping centre, large private hospital or large medical centre);
  • Rule 123: Relocation within the same town (10 km); and
  • Rule 124: short distance relocation.

Evidently, a key consideration in nominating a category is the facility (if any) that a pharmacy will be located in, and its distance from other PBS approved pharmacies.

3. Quality of Accompanying Evidence

The accompanying documentation must be clear, concise and illustrate to the Authority that your application meets the location criteria set out under the Rules. Towards this end, it may be best to draft a cover letter setting out what information you are supplying and how it meets the prescribed criteria. Ultimately, it is up to the pharmacists to satisfy themselves of the quality and completeness of the information supplied to the Authority.

4. Supplying Further Information

It is important to supply the Authority with all necessary accompanying documentation at the outset. Additional documentation submitted after the date of the application will not be accepted. In circumstances where the pharmacists want the authority to consider further information, a new ‘complete application’ will need to be lodged.

5. Review of a Decision

Should the Authority reject the application, a pharmacist has several rights of recourse and may apply for a review of the decision to the Minister of Health, the Administrative Appeals Tribunal, or the Federal Court of Australia (as the case may be).

6. Applying to Operate an Unapproved Pharmacy

As previously mentioned, an unapproved pharmacy is one that is not authorised to receive government payments for the supply of medicines under the PBS scheme. It is, however, possible for a registered pharmacist to operate an unapproved pharmacy subject to the following policies, procedures and provisions:

  • Pharmacy Council of New South Wales (‘the Council’);
  • Health Practitioner Regulation National Law (NSW) 2009 (‘the Law’); and
  • Health Practitioner Regulation (New South Wales) Regulation 2010 (NSW) (‘the Regulations’).

Under Schedule 5F, section 3 of the National Law, a person must not carry on a pharmacy business unless the premises are the subject of current approval of the Council and all interest holders register their interest in the pharmacy business.

You must make an application to the Executive Officer of the Council to obtain the Council’s approval. The fee decided by the Council must accompany the application, and it must be in the approved form (namely the “Pharmacy Council of New South Wales Application for New Pharmacy” form). The prescribed fee is currently $855.65. The Council cannot approve premises unless the premises meets the standards prescribed by the Regulations.

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If you would like to know more about the Rules or the process for establishing an unapproved pharmacy, get in touch with our commercial lawyers on 1300 544 755.

Vanja Simic

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