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Pharmacy contractors' self-reported confidence in the sector has taken a dip year-on-year, the latest Lloyds Bank healthcare index shows. 

Lloyds, which surveyed 74 pharmacists in January and February this year as well as hearing from 98 dentists and 95 GPs, found that community pharmacists' overall confidence rating stood at -12, down from minus nine in the last annual report. 

While pharmacy owners' long-term outlook improved slightly, rising from -48 to -44, their self-reported short-term outlook tumbled from 30 to 19. Nonethless, 47 per cent expressed an interest in widening their scope of practice and 43 per cent said they were looking at acquiring more pharmacies.

Fifty-six per cent anticipated profit growth during 2025 while 86 per cent said the sector's financial pressures are likely to grow over the next five years. 

Staffing costs were rated as the biggest cost pressure, with 89 per cent choosing this as a driving factor compared to 69 per cent in 2024. 

Meanwhile, 74 per cent singled out the cost of sourcing medicines as a key challenge and, against a backdrop of employers' national insurance contributions going up this year, 62 per cent said taxation was a main source of pressure - almost double the proportion that reported the same last year. 

Pharmacy First was on the whole welcomed by survey respondents, 59 per cent of whom reported an income boost from the service and 45 per cent of whom had seen higher footfall as a result.

Leyla Hannbeck, chief executive of the Independent Pharmacies Association, commented: “The fall in pharmacists’ short-term outlook reflects that the survey was conducted just before the new one-year pharmacy contract was introduced in April 2025, and pharmacist sentiment is heavily driven by their contract with the NHS.

“I believe that their stronger long-term outlook is being driven by a new generation of pharmacy owners who are acquiring branches that have been sold by large corporations.

“They tend to be more optimistic, adaptable and enthusiastic about the prospect of delivering more services.

“Many pharmacies are offering private services, including weight loss medicines, which have proved to be a success, and that will help their bottom line.”

Lee Reeves, head of healthcare banking services at Lloyds, said that despite the sector's ongoing financial uncertainty "pharmacists are a resilient bunch with an entrepreneurial outlook".

He added: "They have strong growth aspirations and are engaging with the opportunity that Pharmacy First can provide, which gives me great faith in the future of community pharmacy."