Leela Barham casts her eye over a new economic impact study from Frontier Economics, funded by consumer healthcare association PAGB, on over-the-counter (OTC) products

Frontier makes it clear that its report aims to influence decision makers. It concludes: “Policymakers should recognise the importance that self-care and OTCs play in the UK today and acknowledge the sizeable benefits that greater OTC usage could bring.” 

It’s all part of the PAGB’s wish list, which includes having a national strategy for self-care. PAGB is also asking for ‘recommendation prescriptions’ to support GPs in referring people with self-treatable conditions to pharmacies for advice and treatment. Pharmacists would have the ability to ‘write’ to people’s medical records to record advice and treatments provided and be able to refer people with more complex or serious conditions to other healthcare professionals, fast tracked if necessary. 

Community pharmacy should be interested in the report. It could inform expectations for the future, at a time when new revenue would be very welcome.

Big economic impact 

Frontier says every £1 spent on OTCs – which amounts to some £3.3 billion a year – creates £8.40 in economic and social benefit. That includes contributions to the economy via wages and exports, savings from workplace absence avoided and from prescriptions and appointments not needed in the NHS. Employers reap the biggest benefits from people buying OTCs, followed by the NHS and then the UK economy.

More OTC use in the future could bring even bigger benefits; Frontier suggests that it could avoid £1.7bn worth of costs in the NHS. A further £1.4bn of avoidable NHS costs could come from switching prescription only medicines (POMs) to OTCs.

Big assumptions

Frontier had to make assumptions in order to do its number crunching. That’s par for the course for this type of analysis, but it’s always worth being clear about what those assumptions are. 

For example, Frontier’s analysis of the economic impact on the UK from OTCs comes from data from 20 PAGB members. PAGB has 49 members listed on its website. The 20 account for just over half of all OTC sales, and Frontier scales their figures up to estimate the full OTC market. It’s a big assumption to make that the other OTC sales have the same economic impact– relying on similarity in inputs, wages paid, etc.

Beware unpublished data

Frontier has drawn upon data supplied to it by the PAGB. The keen reader (but how many really read these reports from back to front?) will have spotted lots of footnotes referencing a Pureprofile survey based on 5,000 respondents. This is “data ahead of publication and commissioned by PAGB”. With nothing more to go on, it’s hard to know if this is credible, or not. It’s the driver for most of Frontier’s numbers. 

There is research (dated now, but it shows it can be done and can be published) that shows that buyers of OTCs are different to non-buyers. Could this still be relevant today and a factor at play in the PAGB commissioned and unpublished survey data? And in what direction could this affect the Frontier numbers for economic impact?

Some of the numbers seem optimistic. For example, Frontier suggests that 50 million OTC users would seek NHS treatment if OTCs were not available, in the form of GP appointments and A&E attendances. Given how difficult it is to secure a GP appointment, could this actually have translated into GP appointments? Frontier says prescription costs would be higher too; yet because it’s derived demand – the prescriber is not the consumer – maybe that would not have happened at the same scale either.

Beware generalisation 

Frontier has had to draw on a range of data to help with number crunching. This includes old data (the oldest study cited is from 2001) as well as data from the US. It might be pragmatic, but it’s hard to think that such old data or data from such a different approach to healthcare is generalisable to the UK today.

Healthy scepticism

The numbers Frontier presents should be treated with caution (the same can be said for any study that largely relies on multipliers) – but not just for the reasons that Frontier presents. Those who are willing and able presumably already do use OTCs. For those that don’t, there could be good reasons – leaving aside the switch of POM to OTC.

Realism needed

There are a lot of holes in the Frontier work, but that’s almost inevitable in trying to do these economic impact studies. (I have done them myself and I am no stranger to being on the receiving end of criticism of them.)

Community pharmacy contractors are increasingly having to be keen businesspeople, so hopefully they can see the holes and won’t be over-optimistic about the business opportunity OTCs present in the future. Policymakers should be sceptical too – that is, if they read the detail.

Leela Barham is a health economist