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What you need to know about Canada’s pharmacist shortage

August 16, 2023

pharmacy for sale in Canada
If you are a pharmacist-owner in Canada – and especially if you are hoping to sell a pharmacy within the next year or two – then you need to pay attention to this.
Right now, there is a critical shortage of pharmacists across the country, and particularly in Alberta. In our work as transaction advisors to pharmacy owners, we are seeing an unprecedented number of deal bottlenecks, deal delays and even dead deals. And it’s all happening for one simple reason: the would-be buyer cannot find a pharmacist to run the dispensary.
The good news is that, as a pharmacist-owner, there are steps you can take to counter the pharmacist shortage, operate your business efficiently and improve your chances of successfully selling it. But you need to act fast – and immediately.

Why is there a pharmacist shortage?

The factors driving the pharmacist crunch are numerous and complex. One is that pharmacy schools are simply not producing enough pharmacists. Even as Canada’s population is growing – between 2011 and 2021, by more than 11 percent – and is now approaching 40 million, class sizes are not increasing in most provinces. The sole exception is British Columbia, which is the only province to adjust class size over the past 10 years. (See chart.)

Pharmacy graduates

As of 2021, nearly a third of all pharmacists in Canada – and nearly half in Ontario – were internationally trained. That gives you an idea of how much domestic “production” of pharmacists is lagging demand.
And even with all those international grads coming into the industry, it’s still not enough. Part of that is down to the COVID-19 pandemic. With longer hours and bigger workloads, many pharmacists suffered burnout. They have left the profession to do something else. The ‘pandemic also resulted in the cancelation of many of the PEBC writing opportunities across the country – right when we needed these pharmacists the most.
On top of that, provincial governments hired a lot of pharmacists – we can’t be sure how many – to assist in the administration of their pandemic response. That again reduced the pool of talent available to retail pharmacies.

Why it’s worse in Alberta

A couple of well-intentioned public policy initiatives have helped make the pharmacist shortage in Alberta look particularly serious.
As far as we know, Alberta is the only province in Canada to have introduced a mandatory “bridging program” for internationally trained pharmacists. The idea is to ensure that pharmacists educated elsewhere better meet Alberta’s standards. But the program is expensive and time-consuming for international pharmacists – which means fewer of them decide to work in Alberta.
At the same time, Alberta is leading the way in the trend towards allowing pharmacists to provide professional services, including prescriptive authority for any Schedule 1 drug. The increased revenue from professional services has in many cases made it more economically feasible to operate a pharmacy that has lower prescription counts by traditional standards. So, not surprisingly, that has translated into more pharmacies in Alberta. In fact, the province has about a hundred more pharmacies than B.C. does, even though B.C. has about 800,000 more people. (I’ll admit, though, that the mountainous geography in BC likely contributes to the disparity)
Call it the law of unintended consequences, but these two forces – one decreasing supply of pharmacists, the other increasing demand – has contributed to a shortage in Alberta that to us looks worse than most provinces.
Looking at this from the perspective of “number of pharmacists per pharmacy,” Alberta is around 3.7 (with Newfoundland, New Brunswick, Ontario, and Manitoba having similar numbers). BC, Quebec, Nova Scotia, and Saskatchewan have more than 4.3 licenced pharmacists per pharmacy (with Quebec at a whopping 5.3; the highest in the country)
The data does not make sense though when you look at these numbers, the wages and shortages do not always correlate. I would have expected the “pharmacist have not” provinces to consistently have the highest wages, which only holds true in Alberta and Manitoba. (See chart.)

Number of pharmacists per pharmacy data

Why it matters to pharmacist-owners

Pharmacies are like any other businesses in that their efficiency and profitability rely heavily on the availability and affordability of qualified, trained and motivated team members. In the short term at least, many owners will find it more difficult and more expensive to hire pharmacists on a permanent or replacement basis when they need them. So far, we are seeing this most clearly in rural locations, but it could spread to urban settings if the shortage continues.
Over the longer term, the pharmacist crunch will make executing succession plans and pharmacy sale transactions much more difficult. More and more would-be buyers are consolidators rather than practitioners, and for them the availability of qualified pharmacists is often a crucial condition for completing a purchase.
As we noted above, we are seeing more cases where such purchasers simply can’t find a pharmacist for the pharmacy they want to buy. And the deals don’t happen.

What you can do about it now

For pharmacist-owners, the pharmacist shortage presents two big challenges.
The first is finding and retaining qualified staff at wages you can afford. The solution is straightforward: start thinking seriously about your team members, your HR practices and your pay levels, and go the extra mile to make sure you are attracting and keeping the best people. Trust us, they are in short supply. So, hold on to the good ones. And if you are facing problems retaining staff, figure out why and fix the issues as best you can.
The second big challenge is to your exit plan – i.e., your strategy for selling your pharmacy and/or leaving its operations to another pharmacist. Because of the pharmacist shortage, that will likely not be as simple as hanging a Help Wanted sign on the door. You will need to work to identify, groom and persuade the next “boss” to stay after you exit.
If you are considering selling your pharmacy within the next year or two, that effort becomes all the more crucial. When you have a successor in place, you are presenting prospective buyers with a much more attractive value proposition.
In today’s market, there are fewer independent buyers who will personally “replace” the owner after the transaction and more multi-store owners/buyers who will require a staff pharmacist/manager. If you have one of those lined up, they will not have to take on the headache of trying to find another you. Hiring a successor will help you realize the highest market price for your pharmacy – and help ensure that the transaction will actually go through.
In short, if you want a smooth succession or are hoping to sell a pharmacy, hire and train your store’s next pharmacist now. The shortage of pharmacists in Canada is real. And it’s a challenge no pharmacist-owner can afford to ignore.
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