The Medicines Act 1981 defines a pharmacist as a health practitioner who is registered with the Pharmacy Council of New Zealand as a practitioner of the profession of pharmacy.
This is the most common form of pharmacy ownership. The majority of the share capital must be owned by an individual pharmacist or pharmacists. This pharmacist or these pharmacists must have effective control of the company at all times. For example, this may be reflected by the classes of shares held (if applicable), the ability to appoint directors to the board and the ability to control the board of directors to the board..
As companies and trusts cannot be defined as a pharmacist (even if they are wholly owned by pharmacists) they are not able to hold the majority of the shares of a company. Company structures where a part of the majority pharmacist shareholding is held by a company or trust, are not compliant and will not be granted a licence.
The Licensing Authority may require further information from the applicant to ensure that effective control is vested with the pharmacist(s). Company documents including company constitutions, shareholders agreements and details of the distribution of classes of shares (usually voting or non-voting rights) among the shareholders may be requested.
Restriction on ownership
Any company or individual may have the majority shareholding in up to five pharmacies. A company, or person, that operates or holds a majority interest in five pharmacies may purchase and own a sixth pharmacy for a period of three months while selling one of the original five.
Minority ownership and prescriber interest
Authorised prescribers as defined in the Act, may only have an interest in a pharmacy with the consent of the Licensing Authority. An interest includes, but is not limited to, any prescribers:
- who are a shareholder of a holding company beneficiaries
- are trustees or beneficiaries of a trust holding an interest in the company
- in some circumstances where the prescriber is the lessor to the pharmacy
- holding any commercial agreement involving key money and/or profit sharing.
If you have any concerns whether a particular circumstance qualifies as prescriber interest, please contact Medicines Control.
Depending on the facts and circumstances the consent for prescriber interest might only be given with conditions attached to the licence.
The Act also makes it an offence for any pharmacist or person associated with a pharmacy to give, offer, or agree to give, any money or other consideration as a commission on prescriptions to any authorised prescriber.
Other ownership structures
If you have any questions or concerns about ownership structures other than company ownership, please contact Medicines Control.
Legislation and legal advice
It is recommended that pharmacists consult the relevant legislation, and take legal advice before establishing or amending the ownership structure of their pharmacy.