Rangewell

A Guide to NHS Ownership Transfers for Pharmacies

By Rose Brown
Content writer
Published: 17 March 2022 | Last update: 12 May 20221 minute read
Rangewell

Buying a pharmacy carries many strict compliance processes you need to perform. The NHS contract transfer is perhaps the most vital, so read Rangewell’s guide to learn how to get it done.

Buying a pharmacy is a complex process - but fortunately, we’ve covered everything you need in our comprehensive guide about buying a pharmacy. However, one of the more nuanced areas in the wider pharmacy buying process is the transfer of ownership with NHS consent. 

Table of Contents

When you acquire a pharmacy under a different name from its existing owner, you must register as the new owner with the NHS to dispense prescriptions. There are only a finite number of listed pharmacies, limiting the number of new businesses established in the UK - which is why most pharmacy owners simply take over existing ones rather than try to build from scratch. 

When you do buy a pharmacy, the transfer of the NHS contract should be your number one priority, as you won’t be able to trade until you have it. The two most common formats for buying a pharmacy are asset purchases or share purchases. In a share purchase, where you buy shares in the owner’s company, you often don’t need NHS consent as technically there’s no overt change in ownership provided the contract is in the company name. However, in an asset purchase, where you buy the business and its assets, you will always need to acquire consent to a change of ownership. 

In all likelihood, however, even those pursuing share purchases will need to notify the NHS because any change to factors like opening hours, services offered, and premises expansions/relocations can warrant a need for consent.

Fortunately, the NHS offers a digital system that handles applications covering all of these issues. Whether you buy through assets or shares, you can use this platform to lodge your application and amend the details that are pertinent to your business and planned changes. 

Don't forget to carry out due diligence when buying a pharmacy, so you can ensure compliance from the outset. 

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When should I submit my NHS contract transfer application?

The NHS application process can take a long time, so if you intend to buy you need to prepare your application as early as possible. Most buyers submit their application as early in the buying stage as they can - especially before contracts begin changing hands so that the consent process can progress as your business dealings progress. 

As a buyer, you should ask for some form of exclusivity commitment from the seller even before contract negotiations start. NHS change of ownership applications are visible in the public domain so this agreement will protect you as you head down the buying route. 

NHS consent can take a long time as the review process usually occurs once a month. There’s a 30-day appeal period granted once a decision is given, so the earlier you can apply, the more chance you have to dispute any issues before you’ve finalised the sale. 

Once NHS consent is granted, the actual changes must be implemented within six months. The sales process should not take that long, but both the buyer and seller should be mindful of that timeline as a deadline and aim to have all contractual issues resolved and handover complete. If the sale breaks down, the seller must ask the buyer to withdraw their application or completion notice - unless they’ve already negotiated some form of agreement to protect them in this situation. 

Use the PCSE system to get started

The NHS offers its own gateway to NHS contract transfers via its PCSE online service. To use it, you’ll need to register by emailing PCSE.Marketentry@nhs.net. Once you send your intent to register, you’ll either receive an automated account email or be asked further questions. 

When you have log-in credentials, you can log in to the system and choose to submit a new application or notification or view the status of your existing application.

Note: we don’t want to stress the same basic information continually, so we’ve omitted instructions such as ‘click save and continue’ between each screen of the application. The system’s basic digital functionality is easy enough to use and can be operated via mouse and keyboard with a standard level of digital knowledge. 

Stage 1 - Understanding your options

To get started, you’ll need to log in with the details sent in your email to this website.  Follow the log-in instructions, where you’ll be given a range of options:

  • Create a new application/notification
  • View submitted applications - both historical and those in progress
  • Download/print applications
  • Track progress of your own application

Note that the submitted application feature allows you to research the competition and see what market activity occurs during your own ownership takeover. 

Creating your application is easy - just click the new application button and then select the legal entity under which you’re applying. The portal is split into tabbed categories, which should all be filled out:

  • Undertakings
  • Payment
  • Final Declaration  

Application type

You’ll need to choose your application type, including selecting which type of organisation is applying. These are: 

  • Body corporate
  • Dispensing GP
  • Sole Trader
  • Partnership 

Creating a corporate entity for your pharmacy ownership gives you additional protection against certain liabilities - so is worth exploring if you’ve only ever worked as an employed pharmacist and now want to step into the business world. 

The important thing to note is that you cannot change this, as the application process will present specific questions based on your legal entity choice. Make sure you’ve chosen the one that suits you, and then proceed. 

The application process will begin with a series of simple questions such as whether you’re covered by a contract under the Local Pharmaceutical Services (LPS) Provisions and a number of other questions. Simply tick yes or no and use the dropdown boxes where required. 

The most crucial question is, “Does the application relate to new/additional premises or a change to current pharmaceutical/contractor services provision”. You’ll also need to select one of the following options (though if you’re buying an existing pharmacy, you won’t need to click new).

  1. New/Additional Premises
  2. Change to current Pharmaceutical services provision
  3. Body corporate - change to Director(s)
  4. Body corporate - Change of Superintendent Pharmacist

When you’re buying an existing pharmacy, you’re almost always going to be selecting change to Director. In some cases, you may instead be registering new premises as part of your larger corporate group or changing your pharmacy’s services. All of these moves require significant planning and finance - especially when buying a pharmacy or constructing new premises. 

Before we guide you through the rest of the registration, remember that finance for buying a pharmacy requires specialist insight and support. You’ll need to leverage lender support which requires insight into the finance market and, potentially, specialist knowledge around construction finance, etc.

Here at Rangewell, we’re experts in the pharmacy sector and can help you buy your first pharmacy or expand your pharmacy business. We’ll act as brokers to help you secure the finance you need to grow your business, all whilst helping you navigate the various pitfalls and considerations that present themselves in pharmacy buyouts. 

Click below to get in touch with our team, or continue reading to learn more about NHS Ownership Transfers.

 

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Stage 2 - Registering as a new director

Before we get into the PCSE system and how to input your data, let’s quickly run through the considerations you need when applying for NHS contract transfers. You may need to submit fitness to practice information to the local area team if you’re a new pharmacist - but more likely in the context of this guide is that you’ll be an existing pharmacist and solely need to confirm your fitness to practice declaration is up to date. 

You’ll need to nominate a superintendent pharmacist. This can be you, the buyer, provided you have the required experience or a nominated employee. Even if the superintendent stays on as an employee and remains in the same role after your purchase, any limited company that does not currently own the registered premises must resubmit a superintendent nomination.  

Organisation Details

Now that you’ve used the digital form to outline all of the intended changes, you’ll get a specific series of relevant questions. You’ll also need to complete some standard information, such as the Current Owner Details. You can use the tool to do a postcode lookup to populate some of the information. 

The organisation details are more in-depth and cover your legal status and company structure. It has tabs to organise things, such as ‘Applicant Representative’, ‘Director’ and ‘Superintendent’. 

However, this screen you get here will depend on your organisation and application type. The tabs listed above will appear for a corporate body application but may differ if you’re applying as a sole trader. All you’ll need to do is navigate to all of the tabs and ensure the relevant fields are filled out to the best of your knowledge. Each tab will automatically save when complete and notify you via a ‘record saved successfully’ display. 

For a typical ownership transfer, that means filling out the new director details and then inputting the superintendent information. If you’re acting as both, you’ll be able to ‘pull’ the same info from the director tab by typing your name into the ‘Select your Superintendent Pharmacist’. 

After this, you’ll be presented with a range of new screens that represent some of the main factors of the buying process. Let’s walk through each of them - though some are not relevant to buying a pharmacy and instead apply more to existing owners looking to expand.

Change of location & hours

You can enter the location of the current premises and then select a proposed premises address. If you do, you’ll need to outline your planned opening hours and the floor plan. When buying a pharmacy and applying for the transfer, you’ll need to stipulate any change of opening hours - but you’ll also need to do this under TUPE conditions as your future employees must be made aware of changes that affect them. Again, see our full guide to buying a pharmacy for details. 

Advanced and enhanced services

You’ll need to provide any of the enhanced or advanced services you intend to provide. There’s a range of checkboxes that you can tick - including whether you’ll be providing them, if you are accredited and if the premises are accredited. Advanced and enhanced services such as care home services, new medicine services etc. are all ways to increase your pharmacy's revenue but will have added stipulations and responsibilities - so make sure you are accurate when applying and include every service you plan to offer under the ownership contract. 

You should include them in your initial business plan when applying for pharmacy finance if you're adding services. If you can tie this into a financial forecast to illustrate that additional services will generate higher revenue, you may be able to better influence your lender’s offer. Click here to find out more about business loans for pharmacists looking to become owners. 

Undertakings

The PCSE platform has an undertakings tab, but essentially all this is for is to confirm key declarations such as agreeing to notify the NHS within seven days if any details in the application change.

Body corporate confirmations

You’ll also have to make some declarations on behalf of the body corporate, including whether the relevant body corporate has been involved in offences and criminal convictions. Just click yes or no after reading through all of the wording. 

Further info: qualifications and declarations

Towards the end of the digital application, you’ll need to input your relevant qualifications and make pharmacist declarations. Crucially, you need ALL pharmacists operating in your business to complete these sections and agree to the declaration terms. 

If you’re a business owner and a director of other businesses, you must also declare details of any other interests at this stage. The final step is to confirm your fitness to practice, which must be done separately for each role in the application (director, pharmacist, superintendent etc). 

After submitting all of these details, you’re ready to apply. You’ll have to complete a final payment stage where you can choose your method of payment, and then your application will begin processing. 

Using the NHS system, you can track your application and its status. The status updates to look out for are: 

  1. Submitted: your application has officially been submitted in the system
  2. Undergoing detailed checks: a PCSE officer is reviewing the application
  3. Returned: the PCSE officer has returned the application to you for amendments or further clarification
  4. Redraft: you’ve amended your application and sent it back
  5. Under consideration: the PCSE officer has sent the application to NHS England for a decision
  6. Application/Notification considered: your application is being considered by NHS England. You’ll receive an email about the decision outside of the PCSE system. 
  7. Approved with conditions: as the wording implies, your application is approved but with certain terms
  8. Refused: refused or rejected
  9. Approved - conditional grant met: approved with certain conditions which are now met
  10. Deferred: your application has been put on hold

Commencement & successful completion

After your application has been approved, you’ll have to submit a notice of commencement to the NHS. Again, you can use PCSE to do this online. 

Once you’ve completed your application, it’s a case of waiting for a decision. However, as we mentioned earlier, you should do this at the start of negotiations so that you can proceed with the buying process alongside your NHS contractual considerations. 

Here at Rangewell, we help pharmacists take their first steps into ownership by acting as specialist brokers for the pharmaceutical sector. Don’t go it alone: use our team as a helping hand that can identify the right lenders to suit your needs. We have experience in pharmacy purchases and sales alike, so we’re also happy to help you with advice and guidance where required. 

If you’re thinking about buying a pharmacy, get in touch today

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