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Ensuring the Future: 4 Policies to Reset the Healthcare Distribution Sector

The Healthcare Distribution Association (HDA UK), the representative body for wholesale distributors of medicinal products who supply 95% of all NHS medicines, has developed an updated call-to-action for the new Andy Burnham led Government outlining steps it can take to support the efficient and effective distribution of medicines to patients in the UK.  

As a key component of the UK’s critical national infrastructure delivering 2.1 billion packs of medicines to hospitals, pharmacies and GP practices across the UK, the HDA believes medicine wholesalers should be recognised as such, particularly in the event of unforeseen operational or economic events. The resilience of this comprehensive service is under threat and any interruptions risk undermining timely patient access to medicines and jeopardising patient safety.  

 As a sector operating more than 3500 delivery vehicles to every part of the UK, successive government policy decisions on business rates, national minimum wage and national insurance have forced our members’ costs to serve to climb significantly. The recent crisis in Iran and resultant double-digit surge in fuel costs has added to this upward cost pressure and created an unsustainable burden for HDA members. At current trends, our members estimate fuel costs alone have risen over £10 million per annum due to the crisis. Pharmaceutical wholesalers already operate on incredibly thin margins within a constrained NHS funding environment and these unforeseen and significant increases in operating costs are ones that our members cannot afford to bear alone. 

 The financial viability of the sector is now at risk and the HDA calls on the new Andy Burnham led Government to implement the below four actions within its first 100 days to solidify the viability of this sector and prevent potential service alterations. 

The First 100 Days for Action

The HDA urges the new Government to implement measures under four categories within the first 100 days to alleviate some of the most pressing issues facing the medicines distribution sector. The industry faces significant headwinds including growing financial pressure in community pharmacy, workforce costs, rising fleet and property expenses, and investment in transition to net zero.  

1. Super-deduction 

Introduction of a capital expenditure super-deduction, to unlock further investment in supply chain resilience by our members. Without sustained assistance, the unforeseen and significant increase in fuel costs and broader cost inflationary environment are likely to threaten the overall resilience of the supply chain in the short and mid-term, with potential knock on consequences for patients and the public. 

2. Update to tax system  

Expansion of vehicle excise duty (VED) relief beyond HGVs to include vehicles operated by medicines wholesalers possessing a WDA(H) licence. HDA analysis predicts an expansion to this relief would cost the Government just £1 million, a very low price for the benefit it will yield. 

 Additionally, companies responsible for medicines distribution should be treated as a special case during further reforms of business rates and must not conflated with other warehouse-based sectors who do not provide life-saving treatments for high-street pharmacies, patients and the NHS. As such, any introduction of higher business rates on super-warehouses should include a carve-out for WDA(H) holders.  

3. Green grants 

Greater incentives and financial support for healthcare distributors to better enable the transition to Net Zero, including prioritised access to EV charging and the introduction of PV infrastructure grants.  

Any further Government grants should include specific and ringfenced provisions for medicine wholesalers to ensure they are adequately supported during the transition.  

4. NHS Debt Protection

Mandate NHS hospitals and trusts to pay for medicines in a timely manner as required under the terms of the Better Payment Practice Code (BPPC) which mandates all NHS organisations pay valid, undisputed supplier invoices by the due date or within 30 days of receipt, whichever is later. Despite this, secondary care debt owed to HDA members reached £43.5 million in January 2026 with some NHS Trusts consistently failing their BPPC obligations. HDA members operate on increasingly thin margins therefore if invoices continue to remain unpaid, the financial viability of supplying and delivering NHS trusts may need to be reconsidered until debts are cleared.  

 In primary care, Government must provide the same debt underwriting and backing to pharmacies and GPs as is currently applied to NHS trusts to ensure medicine wholesalers are not left out of pocket should these primary care facilities go out of business.  

These immediate and sustained actions are crucial to revitalising the medicines distribution sector and ensuring that the UK retains its resilient, efficient, and sustainable healthcare system.  

Note to Editors: 

The Healthcare Distribution Association (HDA) represents businesses who supply medicines, medical devices and healthcare services to patients, pharmacies, hospitals, dispensing doctors, and the pharmaceutical industry.  

HDA members operate across the four nations of the United Kingdom, enabling a safe, efficient and high-quality supply chain for the healthcare sector, delivering 95% of the NHS’s medicines. 

As the trade body representing all leading companies that provide pharmaceutical wholesaling services across the UK, the HDA has always supported proportionate regulation to ensure the resilience of the UK’s healthcare supply sector while promoting innovation and adaptability. 

Further Questions 

If you have further questions about the HDA’s ‘Ensuring the Future: 10 Policies to Reset the Healthcare Distribution Sector’ please contact our CEO Alex Williams, at awilliams@hdauk.co.uk. 

 Media Contact 

For all media inquiries, please contact acassoulat@hdauk.co.uk