The Guild, a major political donor to both sides of politics, fiercely opposes any change to current rules that would disadvantage its members. It is also fighting to abolish the existing optional $1 discount to pensioners' PBS scripts - which Chemist Warehouse applies but most small operators do not - arguing the latter cannot afford it. Loading Replay Replay video Play video Play video Grattan Institute health economist Stephen Duckett backed Chemist Warehouse, saying the government's policy of protecting small operators was harmful to consumers and that supermarkets should also be allowed to operate pharmacies inside stores. "Local pharmacies are a highly protected species which is not in the interest of consumers, especially in metropolitan areas," Dr Duckett said.

Loading "The red tape that surrounds pharmacies, there's no reason for it whatsoever." Dr Duckett said the government could opt for a two-tiered approach, keeping restrictions in small country towns to ensure that regional Australians would not lose their local pharmacy. Chemist Warehouse has identified 60 regional towns where it would open outlets if location laws were relaxed, arguing it could offer prices up to 60 per cent lower than their local pharmacies. In New Zealand, Chemist Warehouse last year began offering pensioners free prescriptions in a bid to get more customers in the doors to buy a raft of other products, a strategy akin to the cheap milk sold by supermarkets.

"We're not allowed to do that in Australia, we've got these handcuffs on us," Mr Tascone said. "We'd like the government to allow pharmacies to discount the co-payment to whatever level they want to." Chemist Warehouse shopper Marie Wiseman says cheaper medicines make a big difference. Credit:Simon Schluter He said Chemist Warehouse would welcome competition from Coles and Woolworths, as well as overseas chains Boots and Walgreens, because "it will be highly competitive, like any other industry, and the customer wins". The government's Harper review of competition laws recommended deregulation of the retail pharmacy industry in 2015, but its advice was not followed.

Chemist Warehouse customer Marie Wiseman, 58, said even small savings were valuable for her family, as her husband took eight different medications. Loading "The price has to be competitive for us. Especially if you're self-funded retirees like we are, every cent helps," she said. But another shopper, David Marlow, said he valued his local pharmacist as a bridge between the doctor and over-the-counter medicine. "I think that expert viewpoint is useful," he said. "I'm not sure you're going to get that knowledge about drugs and their interactions in a supermarket or elsewhere."

Pharmacy Guild president George Tambassis said the regulations that underpinned the sector were beneficial to the public and ensured that pharmacies could operate wherever there was a community need. "Modern community pharmacies in Australia are part of the health system – the things they do for patients across medication management and health advice and screening do not belong in aisle eight of a supermarket, or next to the alcohol or cigarettes that they sell," Mr Tambassis said. Pharmacy Guild national president George Tambassis says community pharmacists must be protected. Credit:Patrick Scala "There is ample evidence of competition among Australia's 5700 community pharmacies. Where prices are not fixed under the PBS, there is strong competition and consumers are able to take advantage of this – and they do." Mr Hunt said in statement that the government was "deeply committed to providing ongoing timely and affordable access to Pharmaceutical Benefits Scheme medicines through community pharmacy".