Thousands of High Street pharmacies in England could face closure after ministers confirmed plans to alter the funding system and make cuts.
The Department of Health said it wanted to reduce the £2.8bn a year pharmacy bill by more than £200m over the next two years.
It has been suggested cuts on this scale could lead to up to 3,000 of the 11,700 pharmacies being closed.
Currently, the average pharmacy receives £220,000 a year from the NHS.
This accounts for between 80% and 90% of their income and includes a flat rate of £25,000, which nearly all pharmacies receive.
The changes being announced scrap that and put much more emphasis on performance-related funding, with ministers understood to see the current system as outdated and inefficient.
Figures previously provided by the Department of Health – it has been looking into the issue for some months – suggested the number of pharmacies had increased by a fifth in the past 12 years.
And it has said about 40% of community pharmacies are found in clusters – with three or more within 10 minutes’ walk of each other.
The pharmacy industry has been lobbying ministers in recent months, warning the move could put more pressure on GPs and accident and emergency departments, as pharmacists provide advice and support to patients.
But Health Minister David Mowat said the government had decided to press on despite these protests, as the current system was not the best use of “valuable” NHS resources.
“Far from jeopardising services, our modernisation package will help improve them,” he added.
He said special funds would be set up to support pharmacies in isolated areas and to help set up more in GP surgeries and hospitals, which would be “more convenient” for patients.
Ministers believe these two measures will help offset the closure of High Street pharmacies – it expects another 1,500 GP surgeries will have in-house pharmacists by 2020. These are much cheaper to run.
But Sandra Gidley, of the Royal Pharmaceutical Society, said she was “deeply disappointed”.
“We fear for patients, the public and pharmacists who may be significantly affected by changes in opening hours and staffing levels in community pharmacy, as well as the knock on impact on already pressured GP and A&E NHS care.”
And Shadow Health Secretary Barbara Keeley said the move would be “damaging” and lead to increased demand on the health service as well as pharmacies.
“The government’s plans are not only deeply unpopular, they are short-sighted and they will hit areas with the greatest health inequalities hardest,” she added.