In the heart of Sydney, six men in suits meet. Three of the men are from Big Pharma and three are from a large pharmaceutical chain in Australia. The subject of their discussions is the price for which the company will sell their generic medication to the chain.

As the Pharmaceutical Benefits Scheme price paid to the pharmacies is set by the Government, every cent they can obtain the drug for below this price is money in the pockets of the pharmacists. They find it easier to negotiate a “good” price with more pharmacies in their group. This advantage has led to the rapid spread of pharmacy chains across Australia.

But why does this matter? Doctors determine the medications we receive don’t they? That’s where all the attention is focused, with clear codes of conduct, etc. This is true: the doctors choose the medication but they do not choose the BRAND of medication. Even if a doctor writes a prescription for a generic the pharmacist determines which brand the patient receives unless the patient insists on receiving the brand the doctor prescribed.

The pharmacist has another bargaining chip to play in their negotiation over price — the promise to limit the pharmacies in the chain from dispensing other brands, including generics, over a set period. They have found in the past that the line “I don’t have that brand but can get it in for you in three days” works well to direct most patients to the brand of generic they wish to sell.

There is no media or any other scrutiny and no code of conduct for such negotiations. Such is the power of the Pharmacy Guild, most people aren’t even aware this process occurs.

In another part of Sydney, 120 doctors are ushered into a ballroom where a $100 per head dinner takes place. The guest speaker has been chosen and briefed by the host — Big Pharma — but is an expert in his/her field and answers questions from a knowledgeable audience.

Such events occur all over the country. In some regions the only contact the local doctors have with such specialists is via this method. The doctors all leave, having received entertainment valued at less than 0.0005% of their gross income: hardly sufficient to influence their prescribing pattern. The media cover the event and it is reported and scrutinised carefully by the watch dog established to enforce the code that covers such events. Total cost: less than $150,000.

There are 4200 pharmacists in Australia, with over 167 million prescriptions issued on the PBS in 2006-2007. One dollar saved on each script via discounted generics puts close to $40,000 in each of their pockets per year.

Does this arrangement receive scrutiny? Why should the pharmacist choose the specific generic the patient receives? Why does the Federal Government via the national prescribing service (NPS) advertise for people to choose generic medicines when all the financial benefit for doing so flows into the pocket of the pharmacists and not the people?

Does the supply of generic medication, a different size and shaped tablet, each month, cause patient confusion and medication error? With the impending negotiations in relation to the next pharmacy agreement, perhaps this situation can and should be corrected.