More pill tills

Netcare is to outsource some of its business to Clicks Group.

For the retailer, which operates close to 400 pharmacies, the deal extends its presence by 88 trading platforms as it assumes control of 37 Medicross pharmacies and 51 retail front shops of the Netcare Hospital division. The hospital group wanted to affiliate its pharmacies and front shops to an experienced retail provider to enhance the overall retail service offering to patients and consumers.

According to Clicks CE David Kneale, the company will be rebranding the Medicross pharmacies and Netcare front shops to Clicks. The capex figure is unknown but all the pharmacies and front shops will be given a Clicks look and feel. This includes IT infrastructure to be able to offer the Clicks ClubCard reward programme. The agreement excludes the dispensing of prescriptions in the Netcare Hospital pharmacies, which remain within Netcare’s hospital operations. Clicks will, however, be running the front-shop health and beauty businesses.

Tie-ups between retailers and hospital groups are not uncommon.

Late last year, Lloyds Pharmacy, the second-biggest pharmacy chain in Britain, was reportedly in talks to take over chemists in NHS hospitals. According to the Telegraph , Lloyds already operates around 40 pharmacies in hospitals that have passed into private hands.

Kneale says the implementation date of the transaction is expected to be October 1, and is subject to various conditions precedent and regulatory approvals, including competition commission approval. Both the Independent Community Pharmacy Association and the union Hospersa have raised concern over the plan.

Netcare CEO Richard Friedland says there will be no job losses and that specific staff members in Medicross and the retail front shops in the hospitals will be transferred to Clicks on terms similar to their current conditions of employment.