High-street medicines 'still cost too much'

Shoppers could be paying £420m a year too much

Over-the-counter drug prices are remaining too high because supermarkets are being prevented from opening extra pharmacies, it has been claimed.

The Office of Fair Trading is investigating complaints that restrictions placed on where pharmacies operate are stifling competition, thus keeping prices too high.

One of the UK's biggest supermarket chains, Asda, is calling on the OFT to overhaul the licensing system for new chemists.

It says patients are paying £420m a year to much for medicines, because of restrictions being placed on supermarkets opening new in-store pharmacies.

Asda says the licensing system is outdated and anti-competitive, and a "closed shop" that fails to work in customers' best interests.

Many rejections

The supermarket says out of 15 applications it has submitted to open new pharmacies in the last two years, just two have been approved.

Other supermarket chains have also had similar rejections - even though customers say they want more pharmacies in stores.

Independent chemists, however, say the present system, though restrictive, does work in the best interest of patients.

Over-the-counter medicines are worth an estimated £1.5bn a year in the UK.

Last year, prices of many such products were slashed in the supermarkets after the OFT persuaded the High Court to lift a ruling that fixed their retail cost.

The ruling was condemned by the Community Pharmacy Action Group (CPAG), which said the move could lead to the closure of 12,000 local pharmacies.