Pharmacy News | July 2025

Sanja Milosevic • July 31, 2025

We trust you are enjoying the warm weather as we welcome you to our Summer Newsletter!

 

Pharmacy market and selling activity  

The trend in the pharmacy sales market shows a continued activity with a mix of buyers and sellers, including large multiples and independent owners. We have seen large multiples disposing branches and there’s also a rise in first time buyers and small and mid-sized groups acquiring.

 

Pharmacy contract and increase in funding

The March 2025 funding deal looks promising and much needed boost for community pharmacies and a step in right direction compared to previous years. The Community Pharmacy Contractual Framework (CPCF) budget is to £3.073 billion for the 2025 / 2026 financial year, which will provide an uplift of over 30% compared to previous year. Additionally, an extra £215 million will be directed towards expanding existing Pharmacy First and other services.

(Source: Community Pharmacy England)

 

Outlook for pharmacies

·       Uncertainty in the budget – the upcoming autumn budget is expected to influence future activity in the pharmacy sales market.

·       Integration of technology and AI – technology, including AI and automation is playing a larger role in pharmacy operations and customer experience.

·       Growing role of pharmacies – pharmacies are taking on a larger role which may lead to further changes in the market.

 

Factors influencing the sales market

·       Government policies – government regulations, particularly around funding and potential changes to CGT rules, can impact buying and selling decisions.

·       Economic growth and healthcare spending – increasing healthcare spending and an aging population are driving demand for pharmacy services.

·       Online pharmacy growth – the online pharmacy market is expanding, with companies like Pharmacy2U and others gaining market share.

·       Competition from online pharmacies – online pharmacies are becoming more popular, which may affect the traditional pharmacy model.


Simplifying the sale of pharmacy and our checklist for a successful sale

Selling a pharmacy can be daunting due to regulatory, financial and operational factors, but with the right strategy, we can help you streamline the process and avoid common pitfalls.

 

Here is our recommendation for a smoother sale: -

1.     Prepare early and get organised – collate key documents for the sale such as accounts, FP34s, VAT, returns, lease agreements, staff contract and compliance certificates.

2.     Valuation – use pharmacy specialist agents to assess the value of your pharmacy based on profit multiples, dispensing volume etc (EBITDA workings).

3.     Decide on the sale type – asset sale or company share sale where your accountant will be best to guide you.

4.     Choose the right advisors – Broker helps you market the pharmacy and find a buyer. Please consider appointing a pharmacy specialist accountant and solicitor who have expertise to guide you through the whole sale process to completion.

5.     Marketing the pharmacy – appoint a pharmacy specific broker such as Modiplus who will market your pharmacy in confidence and discreet. All buyers are vetted for funding and sign our confidentiality agreement allowing them to share sales information only with the bank, their accountant and solicitor.

6.     Due diligence – you will be asked to use digital data rooms to share financials, FP34s, supplier contracts etc. Be transparent to disclose everything upfront to avoid delays or warranty claims.

7.     Handle property efficiently – if leased, ensure that there’s at least 10 years left or obtain an extension. If freehold owned, prepare to sale the freehold or grant a new lease to the buyer. Please ensure lease terms meet buyer’s lender requirements.

8.     Navigate NHS and GPhC requirements – For an asset sale, buyer must apply for transfer of NHS contract which usually takes between 2 to 4 months. For a share sale, no NHS approval is needed, however, notify NHS and GPhC of director / superintendent changes within 30 days.

9.     Completion and handover – sign a Sale Purchase Agreement (SPA) or an Asset Purchase Agreement (APA), and hand over to the buyer. 


Other exciting news

As we continue to grow, we are pleased to announce that our associated company Silver Levene was acquired by Xeinadin Group, a top 20 accountancy and business advisory firm in the UK. We highly recommend their pharmacy team of accountants with over 35 years of experience providing specialist accounting, tax and other advisory services to community pharmacies and pharmacists. For more information, please contact the pharmacy partners Mr Vinku Shah or Mr Shivam Modi on 020 7383 3200.

 

Looking further ahead, we will be at The Pharmacy Show at NEC Birmingham on 12 and 13 October 2025. If you are thinking of selling or buying a pharmacy, or looking for specialist pharmacy accountancy and tax advice, our team will be happy to discuss options with you at stand number M20 located next to the business theatre.

 

Last month we participated with our associated company Silver Levene – A Xeinadin Company in the annual 10km London Legal Walk. The charity raised c£1m to support communities’ most vulnerable people and we thank you for your continued donations to support such a good cause.

 

Legal and financial advisors

Please engage a pharmacy specialist legal and financial advisor who will guide you through the process and assist you with any complex issues such as tax, legal contracts, etc. If you would like to sell/buy a pharmacy, need accounting or tax advice through our associated company Silver Levene – A Xeinadin Company, please contact us on 020 7383 3200. We have been providing specialist accounting and tax advisory services to community pharmacy for over 35 years. Your query will be directed to the right person. Silver Levene - A Xeinadin Company offers fixed price packages for accounting and tax services as well as valuations, cashflow and profit forecasts, raising loan finance, due diligence and accountancy work for asset and company sale transactions.

 

Thinking of selling or buying?

If you would like a free valuation or to talk about how you could achieve a fantastic price for your pharmacy, please do contact us on our direct dial number 020 7380 3446 and ask for Sanja. We would welcome the opportunity to have a chat with you.

 

We look forward to hearing from you. 


This article is based on current legislation and practice and is for guidance only. Specific professional advice should be taken before acting on matters mentioned here.

Pharmacy News | February 2025

By Modiplus • February 26, 2025
Welcome to our Winter Newsletter! Pharmacy market trend and buyers’ appetite If you are thinking of selling your pharmacy, there is still a demand for pharmacies across the country as the market remains buoyant. The pharmacy market has seen an increase in the number of pharmacies entering the market and completed sales. This is driven by economic pressures, fiscal policies, lack of funding, and exit of larger multiples from the market, such as Lloyds Pharmacy and Boots, which has led to the rise of independents and consolidations. The appetite remains strong from the first-time buyers, with independent and smaller chains the most active in the pharmacy acquisitions. Valuation calculations We have also seen the valuation of pharmacies improving, and on average we are achieving a goodwill price of 85p to 90p in £1 of turnover for standard hour contracts. Demand for pharmacies with a turnover of more than £750k to £1.5m with healthy profits is particularly attractive for the first-time acquisitions or an existing independent operator looking to expand. Below is a range of estimated valuations, if you are looking to sell: -

Pharmacy News | August 2024

By Modiplus • August 29, 2024
Welcome to our Summer Newsletter and we trust that you are enjoying the late summer weather! This summer has been extraordinary so far, full of sporting events such as football, tennis, cricket and the Olympic games! We have been very busy in the last quarter, whereby we have seen the first-time buyer appetite remain strong. Similarly, we have seen an increase in the number of sales enquiries of smaller pharmacies while others are holding off awaiting the outcome of the new funding and success of Pharmacy First scheme. On average we are achieving goodwill price of between 85p to 90p in £1 of turnover at present. The average profit margin has shown an improvement to 32% despite medicine shortages. Data from Pharmacy First (NHSBSA) The launch of the Pharmacy First has gone off with a positive start, it has been very encouraging to see so many patients benefiting from this scheme, and your exceptional efforts in delivering these services have been commendable. However, we note that monthly payments are still critical, and concur that it is completely unreasonable for pharmacy to be penalised financially for the NHS’ failure to drive public and GP referrals. The NHS Business Services Authority (NHSBSA) has released figures for the Pharmacy First Service covering the period of February to April 2024 as follows: -

Pharmacy News | April 2024

By Modiplus • April 16, 2024
Welcome to the spring edition of our quarterly newsletter Initial reaction to Pharmacy First Recent research conducted by AIMp found that 70.8% of the pharmacy owners do not think there is sufficient funding allocated for the scheme, 20.8% say it is too early to say and just 8.3% responded saying it was adequate. Their #Fight4Pharmacies campaign was also launched on 20 March 2024 outside Parliament which created an extensive amount of interest with the media and politicians. The success of the Pharmacy First scheme will vary and depending on factors such as local implementation, public awareness, pharmacist training etc. To address funding shortfalls, pharmacy owners need to explore other options such as reallocating resources, securing additional funding and enhancing relationships with GPs. Pharmacy contract and funding The old contract has expired, however, there is no news regarding the pharmacy funding negotiations. The negotiations are taking place between Community Pharmacy England (CPE) and the Department of Health and Social Care (DHSC) , supported by NHS England (NHSE) . The reasons for the sale of community pharmacies The sale of community pharmacies can occur for various reasons and under different circumstances as follows: - Retirement - You may choose to sell your business when you reach a retirement age or decide to exit the profession for personal reasons. Selling the pharmacy allows you to liquidate your assets and transition into retirement. Relocation - Changes in your personal circumstances or opportunities in a different location may prompt you to sell and move elsewhere. Relocation could be due to family reasons, lifestyle preferences, or professional opportunities. Financial reasons - Financial challenges or the desire to capitalise on the value of the pharmacy may lead you to consider selling. This could include factors such as declining profitability, changes in reimbursement rates, or the need for additional capital investment. Expansion or consolidation - A multiple may acquire as part of their expansion or consolidation strategies. Selling to a larger entity can provide you with higher value in some cases. Launch of Pharmacy First and providing new services - The running of pharmacies has undergone several changes over the years, particularly with increased automation, digitalisation, and expansion of online services. The model has gone through a complete overhaul. We are seeing lots of our clients for whom we provide accountancy services at Silver Levene who are struggling with Pharmacy First services due to staffing issues which is resulting in decline of their profit margins. Market dynamics - Changes in the healthcare landscape, regulatory environment, or consumer behaviour may influence your decision to sell. Adapting to evolving market conditions or responding to competitive pressures may involve selling the pharmacy to a buyer better positioned to navigate these challenges. Following large corporate disposals, we are now seeing the goodwill value increase compared to last quarter, which makes it an ideal time to exit, if you are looking to sell. With bank interest rates likely to go down from June, affordability becomes easier too. Succession planning - You may sell your pharmacy as part of succession planning efforts, either transferring ownership to family members or grooming internal staff to take over management. Selling the pharmacy ensures a smooth transition of ownership and management responsibilities. The sale of community pharmacy is typically a complex process that involves legal, financial, and regulatory considerations. You as pharmacy owners may work with sales agents, financial advisors, or legal professionals to facilitate the sale and ensure compliance with relevant laws and regulations governing pharmacy ownership and operation. If you are thinking of selling, it is paramount to get your house in order and speak to your accountant well in advance and prior to putting the pharmacy on the market. We can provide accountancy and taxation services through our associated company Silver Levene with a proven track record of over 30 years. Changes in ownership With last year’s corporate disposals, the tide has turned, and more pharmacies are now run by independents compared to corporates. The recent Sigma conference in South Africa highlighted this issue, as shown in the table below courtesy of RWA Pharmacy: