Liverpool-based independent pharmacy chain RB Healthcare refinances and restructures its business and cuts losses as it battles ‘underfunding’ from the NHS. Tony McDonough reports

Liverpool-based independent pharmacy chain RB Healthcare (RBH) says it is confident it will revive its fortunes following a turbulent couple of years.

RBH, which operates 15 community pharmacies in Liverpool city region and across the North West, breached its loan covenants in early 2024. This led to a refinancing of its debts and a restructure of the business.

In the last few weeks the firm has posted its annual accounts for the 12 months to November 30, 2024, on Companies House. They show revenues up slightly to £15.7m and pre-tax losses cut to £577,502 from £654,214 in the previous year.

In August 2021, LBN reported that RBH had secured a £12.5m funding package from Santander which enabled it to acquire 11 pharmacies, taking its then total number of outlets up to 14.

However, the business faced challenges in 2023 when the NHS reduced funding for COVID vaccinations. This compounds the longer term funding problems facing community pharmacies across the UK.

Organisations such as the National Pharmacy Association and the Company Chemists’ Association estimate NHS funding for pharmacies has fallen by 40% since 2015 when adjusted for inflation.

This, they claim, has put significant pressure on the sector with around 1,400 pharmacy closures since 2016. Outlets have had to cut costs by reducing opening hours and stopping free home deliveries of medicines.

In response the Government announced a record funding increase of 19% to almost £3.1bn for the 2025/26 financial year. This was welcomed as a “first step” but it is claimed  rising costs mean the sector is still more than £2bn short per year on what it needs.

RBH is owned by Dr Sumit Kochhar via an entity called Sukapras Limited, and Shalina Bhatia. The accounts reveal total dividends for the year of £378,578.

Writing in the annual report, Dr Kochhar and another director, Rishi Bhatia, said: “During the year, the group focused on the restructure plan, while ensuring the delivery to patients was kept to a high standard, with improvement seen in the underlying performance.

“Following the 2023 year end the directors implemented a strategy to improve the performance of the group that had been impacted by the underfunded NHS pharmacy contract.”

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They added the revised NHS contract offered the directors confidence that they will be able to increase the profitability of the group through organic growth under their business plan. As part of the refinance shareholders had agreed to provide additional cash.

“The improvement reflects the delivery of the group strategy, the uplift in the pharmacy contract and growth in private and NHS services,” they said.

“Although the uplift in funding from April 1, 2025, has been welcomed by the sector the funding still falls short of what is required.”