The mega-merger of two of Australia's biggest pharmaceutical players has been met with mixed reviews by chemists in regional areas.
Discount pharmacy retailer Chemist Warehouse is set to merge with Sigma Healthcare to create an $8.8 billion pharmaceutical giant after being approved by Australia's competition regulator on Thursday.
Sigma Healthcare owns the Amcal, Guardian, PharmaSave and Discount Drug Store pharmacy brands.
The merger will give the new company about 1,000 retail stores and 16 distribution centres in Australia and New Zealand, as well as end-to-end oversight of the pharmaceutical process.
It is this control and oversight, from product creation to retail sales, that has some pharmacists in regional areas particularly concerned.
Gareth Paterson says he is concerned regional pharmacists will not be able to compete on price. (Supplied: Gareth Paterson)
Gareth Paterson, who works as a locum pharmacist and has run chemists in Benalla and Euroa, told ABC Victorian Statewide Mornings the merger could make it impossible for smaller pharmacies to stay afloat.
"I just feel it will give them an unfair business advantage over smaller operators," Mr Paterson said.
The Australian Competition and Consumer Commission (ACCC) said it was confident the deal would not substantially reduce competition in the pharmaceutical sector.
But Mr Paterson said he was not so sure.
"If they can control the supply chain … if they are the wholesaler, they are going to have much more favourable trading terms than the small business operators," he said.
In its April submission to the ACCC over the then-proposed merger, the Pharmacy Guild of Australia said regional and rural pharmacies could face higher costs than their metropolitan counterparts.
The guild noted the corporate watchdog's decision to allow the merger to proceed, stating the ACCC would need to keep a close eye on the new company.
“Reduced competition ultimately leads to higher prices for patients and lower service standards," a spokesperson said
"It’s disappointing the ACCC accepted limited behavioural undertakings and did not explore structural undertakings."
Independent pharmacist Paul Wickham does not work for one of the big-brand chemists, but he has got a soft spot for them.
He takes advantage of their extended trading hours to find a nice slice of work-life balance.
"[It] allows me to have a weekend off and play cricket with my son," Mr Wickham said.
Paul Wickham is supportive of the mega-merger. (Supplied: Paul Wickham)
Mr Wickham, who runs a pharmacy in Mooroopna, said discount pharmacies and independent stores could still co-exist, despite the feared dominance of the new billion-dollar venture.
"I hope there's a robust enough system to allow the merger to take place and still benefit the public and still allow enough competition within the pharmacy industry," Mr Wickham told ABC Victorian Statewide Mornings.
The merger still requires the approval of Chemist Warehouse and Sigma's shareholders and the Federal Court.