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Considerations with generic comparisons

The generic market is a complex one, over the past 12 months we have seen
shortages, increasing in pricing and a record number of concessions. It is
important to understand what you are looking at when making purchasing
decisions, as a wrong decision could cost the dispensary £100’s. I have
summarised below some key things to watch out for, based on PSUK members
that have made a change and then come back to APM as it was more profitable.

1 - High % discounts - It is very easy to offer a high % discount if your
offering it off a very high list price! When looking at generics you need to
understand what the % is off DT - this is where you make your profit. It is
impossible for a competitor to do a full price comparison without knowing your
full generic purchases by volume, line by line. Your basket of generics that cost
you £10k with 25% discount from PSUK will still be cheaper than a basket that
cost you £14k with 30% elsewhere. Generics are not like brands; each wholesalers
start price will differ. Therefore, if someone asks to see your APM rebate report to
do a comparison, offer them your generic purchase summary instead to see how
much it would’ve cost as a basket through them for that month. You can then
compare it against your APM rebate.

2 - Availability - One of the strengths of APM is availability of the rank 1
product KEYS. If you are not familiar with KEYS, you will no doubt have seen
KEYS in the product description on our portal. KEYS is not a brand of generics, It
is effectively the ring-fenced stock I mentioned in my opening statement that
PSUK have secured for dispensing practices and selected Golden Tote members
– no independent pharmacies have access to your protected stock which
prevents any raiding of products that go short in the market. We supply the rank
1 KEYS product 93% of the time - then it moves to a very competitive rank 2.
Other wholesaler chaining can often chain through to expensive branded generics
- and quite often we see significant differences on those purchases chaining
through vs APM. We often find customer using alternative wholesalers are often
trying to order through PSUK as we have availability for longer.
It is also worth mentioning that if a wholesalers availability isn’t great - you will
end up having to purchase from a 2nd line wholesaler who won’t give you their
best pricing.
So, when looking at comparisons with other wholesalers, check what their availability
was for that month across their rank 1 product.

3 - Minimum spends & thresholds - More often than not, wholesalers who
offer spot buy opportunities also have a minimum order criteria. Failure to hit
this will result in either a carriage charge or trade price being charged. Both of
which negate any penny savings you may have made, It’s also worth resisting the
temptation to bulk the order up with fast moving lines - as this can also cost the
dispensary dearly due to pricing.

Hopefully, you will have found some of the above useful in some shape or form
and I hope you have a prosperous 2024.

If you do have any further questions, then feel free to reach out to your PSUK
account manager or send me an email at rfenwick@psuk.co.uk

or call us on 01904 558 350 Generic Purchasing | PS Magazine 7 7

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