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Hospital Decided to Divert Drugs

February 17, 2010 – 4:37 pm

I hope you read this news in today’s  PMP News.com Daily Newsletter: “Hospital makes a profit trading NHS drugs in Europe.”  Before you click to read it, though, I just want to share a few quick thoughts.

This story shocked me. We’ve reported instances of tampering and theft by healthcare professionals and others seeming to deserve our trust. But in this case, a business decision was made to ignore drug pricing agreements. As the story reports, “The Royal Surrey County hospital foundation trust had been trading in the pharmaceutical export market by buying up drugs at the cheap NHS price and selling them to a wholesaler for export.” It proceeded to do so “despite warnings from the government that such behaviour was unacceptable.”

The Royal Surrey’s finance director Paul Biddle told the Health Service Journal, the trade magazine which broke the story, that “yes, we did see this as an opportunity to make a margin.”

Such diversion reportedly threatens drug availability and could impact future discount negotiations between pharmaceutical companies and the NHS. Patient safety could certainly be an issue if drugs are in short supply. But what about handling integrity? Or labeling? If products were packaged and labeled for one market, could that packaging and labeling fail to support requirements in the market into which product is diverted?

Mass serialization, of course, could be used to identify and root out such diversion. Pharmaceutical companies could therefore ensure that the pricing agreements they forge with certain entities do not affect supply in other markets. Pharmacies could also be assured of manufacturer-approved handling as well as market-compliant packaging and labeling.

Both assurances could certainly promote patient safety.

Daphne Allen

P.S. Click here if you are interested in receiving PMP News.com Daily Newsletter.

  1. 3 Responses to “Hospital Decided to Divert Drugs”

  2. WHY THE SHOCK? THIS HAS BEEN GOING ON FOR DECADES. ANYTIME A CLASS OF PURCHASER IS GIVEN A SPECIAL PRICE THERE IS AN OPPORTUNITY FOR DIVERSION.
    PLANNED PARENTHOOD UNITS, HOSPITALS, CLINICS ETC HAVE DONE THIS FOREVER. THIS IS ONE REASON DRUG PRICES ARE HIGH. WE UNKNOWINGLY PAY HIGHER PRICES SO CERTAIN FAVORED GROUPS CAN ENJOY A LOWER PRICE. CALL IT A HIDDEN TAX.
    THE EXACT THING OCCURS WITH DIFFERENT PRICES INTERNATIONALLY.

    By JIM MCDANIEL on Feb 24, 2010

  3. There is a rapid growth of Outsourcing these days as manufacturers try to cut cost and maximize profit.;*`

    By Katherine Campbell on Jun 10, 2010

  4. outsourcing is really necessary specially if you want to cut the cost of production.,”‘

    By Eli Ally on Jul 27, 2010

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