Sunday, April 06, 2008

Coles's pharmacy role in doubt after court ruling

From the Sydney (Australia) Morning News:
Wesfarmers-owned Coles's back-door entry into the $9 billion pharmacy sector appears under threat after a court ruled that its purchase of a Sydney-based cut-price pharmacy chain may have breached laws restricting ownership to qualified pharmacists.

The threat comes after the NSW Supreme Court judge Peter Young ruled yesterday that because Pharmacy Direct, a mostly online chemist that Coles bought two years ago, is not owned by a pharmacist, it has breached the pharmacy act.

Justice Young is yet to make his final orders, but when the case resumes later this month he could force Wesfarmers to transfer or sell Pharmacy Direct to a pharmacist or pharmacist-owned corporation.

The retailer, which Coles bought for $56 million, is one of only 30 pharmacies in NSW that operates under a corporate licence. It claimed it had been acting lawfully since Coles bought the business in 2006 from the founder and pharmacist Peter Brown. However, Coles was widely criticised by the industry as having used a loophole to encroach on the territory held by mostly independently owned chemists. ...more

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