Published 12 September 2026 · By Jatin Dua, Broker of Record, RE/MAX Quantum Realty
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Get My Free Estimate →The Certificate of Accreditation does not come with the pharmacy. The Ontario College of Pharmacists puts it in one sentence: “Acquiring an existing pharmacy in Ontario is equivalent to opening a new pharmacy and requires issuance of a new Certificate of Accreditation.” You do not inherit the vendor’s certificate. You get a new certificate and a new accreditation number. That fact reorders the whole transaction. A complete application has to be in before construction and at least 45 days before the proposed opening date, issuance depends on a satisfactory assessment of the premises, and all new openings must occur on a weekday. Your closing date is not just a negotiation with the vendor. It is a function of the College’s calendar.
A pharmacy purchase is legally a new pharmacy
Every pharmacy in Ontario has to be accredited by the Ontario College of Pharmacists. Most buyers know that. Fewer know what happens to the accreditation when the business changes hands.
Nothing. It does not travel. The College’s own application material says a Certificate of Accreditation “shall be issued in the specific name of the owner of the pharmacy,” and therefore “Purchasing an existing pharmacy is therefore equivalent to opening a new pharmacy and will result in the issuance of a new Certificate of Accreditation and accreditation number.” The same treatment applies to a relocation and to an amalgamation.
Read that as a buyer. You are not stepping into a running licence. You are applying, from scratch, for permission to operate a pharmacy at that address, in your name. The College is not rubber-stamping a change of name on an existing file. It is opening a new one.
Pharmacy is the outlier among the clinical professions here. A physiotherapy clinic has no premises accreditation at all; the College of Physiotherapists licenses the corporation, not the room. Pharmacy accredits the space and the owner together, and on a purchase the owner is changing.
It is almost never the licence. It is the calendar
The consequence that costs money is timing, not eligibility. The question is when, and whether the date you wrote into the agreement of purchase and sale bears any relationship to it.
The College’s published sequence for opening a pharmacy is specific. A complete application must be submitted “prior to construction and at least 45 days prior to the proposed opening date.” Issuance of the certificate “is subject to the approval of the application, and a satisfactory assessment of the pharmacy” by a community operations advisor. And then a line that catches people: “All new openings must occur on a weekday,” because Ontario Drug Benefits is closed on weekends and a pharmacy that cannot bill cannot meaningfully open.
Forty-five days is a floor, not an estimate, and it runs from a complete application. The assessment has to be booked, attended and passed. And the opening cannot be a Saturday, which quietly removes a third of the calendar.
I read the lease and the permitted use before the offer goes out for exactly this reason. Sequencing this backwards is the expensive mistake: buyers commit to a closing date, start paying rent and debt service, and then discover the certificate is the last domino and it has not fallen yet.
The application comes before the construction, not after
The phrase “prior to construction” is doing a lot of work and it is easy to skim. If you are buying an existing pharmacy and changing nothing, fine. If you are rebuilding the dispensary, adding a compounding room or moving the consultation area, the College expects the application filed before the trades start.
That is a real constraint on a renovation-and-reopen play. Your design has to be settled early, not resolved on site. And the premises requirements — accredited area, dispensary size, sinks, refrigeration, the safe, acoustical privacy, compounding ventilation — become lease negotiation items rather than fit-out afterthoughts. A pharmacy is the clearest case I know of for putting a lease review condition in the offer.
Two more dates: a follow-up callback assessment six to twelve months after opening, and annual renewal on or before 10 May. Accreditation is not a one-time gate.
Who is allowed to own it: a majority, not the whole thing
Here is where pharmacy is genuinely different, and where the difference creates deal room. The Drug and Pharmacies Regulation Act sets the test. Section 142(1): “no corporation shall own or operate a pharmacy unless the majority of the directors of the corporation are pharmacists.” Section 142(2): “no corporation shall own or operate a pharmacy unless a majority of each class of shares of the corporation is owned by and registered in the name of pharmacists or in the name of health profession corporations each of which holds a valid certificate of authorization issued by the College.”
That is a majority test, not a hundred per cent test. The statute itself contemplates that a minority of the shares in each class, and a minority of the board, sit with someone who is not a pharmacist. Compare the other clinical professions.
| Profession | Ownership test | Source |
|---|---|---|
| Pharmacy (corporation owning or operating a pharmacy) | Majority of directors must be pharmacists; a majority of each class of shares must be held by and registered in the name of pharmacists or health profession corporations holding a valid certificate of authorization | Drug and Pharmacies Regulation Act s. 142(1), (2) |
| Dentistry (health profession corporation) | Voting shares held by College members; non-voting shares limited to a member, specified family of a voting dentist shareholder, or held in trust for minor children of a voting dentist shareholder | O. Reg. 665/05, as described by the RCDSO |
| Physiotherapy (professional corporation) | All owners must be physiotherapists; non-physiotherapists cannot own one | College of Physiotherapists of Ontario |
| General rule for professional corporations | “All of the issued and outstanding shares of the corporation shall be legally and beneficially owned, directly or indirectly, by one or more members of the same profession” | Business Corporations Act s. 3.2 |
Why does the difference matter? Because a pharmacist who cannot fund the purchase alone has a lawful structure available inside the statute, where a physiotherapist in the same position does not. A minority non-pharmacist investor in a pharmacy corporation is not a workaround. It is what the section says.
What I will not do is tell you how to build that cap table. The test bites on every class of shares, the directors test runs alongside it, and getting either wrong means the corporation is operating a pharmacy it is not permitted to own. That is for a lawyer who does health profession corporate work, with the share register in front of them, before the offer is firm.
One gap worth naming: the College’s published material describes corporate ownership under s. 142 and does not address whether an individual pharmacist as sole proprietor, or a partnership, may hold a certificate. I have found no College statement resolving it either way, so I say neither. Ask the College and get the answer in writing.
The Designated Manager is not a formality
A pharmacist Designated Manager is mandatory under the DPRA. Each corporation also appoints a pharmacist Director Liaison, and each pharmacist director files a Declaration of Good Character. Applicants are assessed on whether their conduct “affords reasonable grounds for the belief that the pharmacy will be operated with decency, honesty and integrity and in accordance with the law.”
For a buyer this is an operational condition dressed up as paperwork. If the vendor is the Designated Manager and leaves on closing, you need your own in place. If your intended Designated Manager is a current employee, they come with the business but not with a guarantee. No Designated Manager, no pharmacy, whatever the agreement says.
Thirty days to report a corporate amendment
Once you own it, corporate amendments must be reported to the College within 30 days. New director, share transfer, name change, amalgamation. That clock is not the same as anyone else’s — the RCDSO’s shareholder-change window for dentists is ten days. These numbers are not interchangeable, and generic advice borrows them across professions constantly. Use the one that belongs to your regulator.
Asset or shares, and what each one does to the certificate
In most Ontario business purchases the asset-versus-share question turns on tax and liability. In pharmacy it also turns on the certificate.
The College’s position is framed around the owner: a certificate “shall be issued in the specific name of the owner of the pharmacy,” and purchasing an existing pharmacy results in a new certificate and a new accreditation number. Where the identity of the owning corporation genuinely does not change, that raises a question the College’s published material does not squarely answer. A share deal is not a trick that makes accreditation disappear. Put the structure to the College in writing before you rely on an answer.
| What you are buying | Does it come with the business? |
|---|---|
| Certificate of Accreditation | No. A purchase is treated as equivalent to opening a new pharmacy; a new certificate issues |
| Accreditation number | No. A new number issues |
| Premises approval | No. Subject to a satisfactory assessment by a College community operations advisor |
| The lease | Only by assignment, and only with landlord consent where the lease requires it |
| Employees’ service (asset sale) | Yes. Deemed continuous under Employment Standards Act, 2000 s. 9 |
| Goodwill | Yes, and it is not subject to HST where the business-sale conditions are met |
The short version
A pharmacy purchase is a new pharmacy. New certificate, new accreditation number, full application before construction and at least 45 days before opening, a satisfactory premises assessment, and a weekday opening. The ownership rule is a majority test — majority pharmacist directors and a majority of each class of shares in pharmacist or health profession corporation hands — which is looser than the all-shares rules in dentistry and physiotherapy and leaves statutory room for a minority non-pharmacist shareholder. A Designated Manager is mandatory. Corporate changes are reported within 30 days. And nobody credible publishes what a pharmacy sells for.
HST: goodwill, the section 167 election, and the trap
Ontario HST is 13%. Two things matter on a business sale.
First, goodwill. Under s. 167.1 of the federal Excise Tax Act, where the recipient is acquiring “all or substantially all of the property that can reasonably be regarded as being necessary for the recipient to be capable of carrying on the business,” the part of the consideration reasonably attributed to goodwill “shall not be included in calculating the tax payable in respect of the supply.” CRA confirms that holds whether or not the election is filed, provided the conditions are met.
Second, the election. Section 167 lets vendor and purchaser jointly elect so tax does not apply to the supply of the business. “All or substantially all” is generally 90% or more of the fair market value of the necessary property. If the supplier is a registrant, the recipient must also be one. The election is made jointly on Form GST44, filed by the date the recipient would have had to file a return for the first reporting period in which tax would have become payable.
And the trap: three carve-outs survive the election. Tax still applies to a taxable supply of a service by the supplier, to a supply of property by way of lease or licence, and to a taxable sale of real property where the recipient is not a registrant. Buy the pharmacy and the building through an unregistered entity and HST on the real property is payable notwithstanding the election. I have set out HST clauses in an Ontario agreement of purchase and sale separately. Have your accountant confirm the registration status of the actual buying entity, not the one you meant to use.
The staff come with the business whether you plan for them or not
On an asset sale, s. 9(1) of the Employment Standards Act, 2000 is unforgiving in its simplicity: “If an employer sells a business or a part of a business and the purchaser employs an employee of the seller, the employment of the employee shall be deemed not to have been terminated or severed for the purposes of this Act and his or her employment with the seller shall be deemed to have been employment with the purchaser for the purpose of any subsequent calculation of the employee’s length or period of employment.”
“Sells” includes “leases, transfers or disposes of in any other manner.” The s. 9(2) exception is narrow: it applies only where the purchaser hires the employee more than 13 weeks after the earlier of the employee’s last day with the seller and the day of the sale.
So the twenty-year technician you keep on is a twenty-year employee of yours from day one for ESA purposes. Notice of termination under s. 57 runs to at least eight weeks at eight years or more of service. Severance under s. 64 is engaged at five years or more of service where the employer’s payroll is $2.5 million or more, or on the 50-employee discontinuance branch, and is capped at 26 weeks’ regular wages. Price that in. It is one of the few pharmacy liabilities you can quantify in advance.
What a pharmacy is worth
I will be straight with you: no credible Canadian primary source publishes pharmacy sale values or multiples. Not the College, not Statistics Canada, and not the federal industry statistics, which publish revenue and profitability benchmarks rather than sale prices.
Anyone quoting you a multiple for an Ontario pharmacy is quoting their own book. That can be useful market intelligence and I would listen to it, but it is not a published benchmark and it should not do the work of an earnings review, a script-count analysis and a lender’s underwriting. Ask whoever quotes a number where it came from. The answer tells you how much weight to give it.
How I would sequence it
Confirm the zoning and permitted use for the address first, because a pharmacy is a specific use and the map is not the answer. Read the lease, especially the assignment clause and the term remaining. Get the ownership structure cleared by counsel against the s. 142 majority tests. Settle the Designated Manager. File the accreditation application early enough that 45 days, the assessment and a weekday opening all fit inside your closing window. Have your accountant deal with the election and the buying entity’s registration. Quantify the ESA exposure on the staff you keep. Then pick a closing date.
A real estate lawyer handles the conveyance and the lease assignment. A health-law lawyer handles the corporation and the College. My job is the premises, the lease and the sequence — and telling you when the date you want is not a date that exists.
FAQ
Can I just take over the vendor’s Certificate of Accreditation?
No. The Ontario College of Pharmacists states that acquiring an existing pharmacy “is equivalent to opening a new pharmacy and requires issuance of a new Certificate of Accreditation.” The certificate is issued in the specific name of the owner, and a purchase results in a new certificate and a new accreditation number. The same treatment applies to a relocation and an amalgamation. Plan on applying as a new pharmacy, because that is how the College will process you.
How long before opening do I have to apply?
The College requires a complete application “prior to construction and at least 45 days prior to the proposed opening date.” Forty-five days is a minimum measured from a complete application, and issuance is still subject to approval of the application and a satisfactory assessment of the pharmacy by a community operations advisor. Treat it as a floor rather than a forecast, and note that all new openings must occur on a weekday.
Why does the opening have to be on a weekday?
Because Ontario Drug Benefits is closed on weekends, and the College’s published guidance is that all new openings must occur on a weekday. In practice this removes weekend closings from the table as opening dates and tightens an already narrow window. It is a small rule with an outsized effect on scheduling, particularly when your lease commencement, your loan advance and your accreditation assessment all have to land in the same week.
Do I have to be a pharmacist to own a pharmacy in Ontario?
The corporate test is a majority test. Under the Drug and Pharmacies Regulation Act, no corporation may own or operate a pharmacy unless a majority of its directors are pharmacists, and a majority of each class of its shares is owned by and registered in the name of pharmacists or health profession corporations holding a valid certificate of authorization. So the statute contemplates a minority non-pharmacist shareholder — unlike the all-shares rules in physiotherapy. Have counsel structure it.
How is that different from buying a dental or physiotherapy practice?
Both of those are tighter on ownership and looser on premises. Physiotherapy professional corporations must be wholly owned by physiotherapists, and there is no College clinic licence or premises accreditation at all. Dental health profession corporations restrict voting shares to College members, with non-voting shares limited to a member or specified family of a voting dentist shareholder. Pharmacy allows a minority outside shareholder but accredits the physical premises, which no other one of the three does.
What happens to the staff if I buy the assets rather than the shares?
Their service follows them to you. Section 9(1) of the Employment Standards Act, 2000 deems employment not to have been terminated and deems service with the seller to be service with the purchaser for any later calculation of length of employment. The only escape is s. 9(2), which applies where you hire more than 13 weeks after the earlier of the employee’s last day with the seller and the day of the sale. Price notice and severance accordingly.
Is HST payable on the goodwill?
Not where the business-sale conditions are met. Section 167.1 of the Excise Tax Act excludes from tax the part of the consideration reasonably attributed to goodwill where the recipient is acquiring all or substantially all of the property necessary to carry on the business, and CRA confirms this applies whether or not the s. 167 election is filed. The election itself is made jointly on Form GST44. Real property where the buyer is not a registrant is a separate problem — that carve-out survives the election.
What is an Ontario pharmacy actually worth?
There is no published Canadian figure. No government source, no College source and no national statistical agency publishes pharmacy sale prices or multiples for Ontario. Industry statistics publish revenue and profitability averages, which are not sale values. If a broker or a vendor quotes you a multiple, ask where it came from — it is their own transaction experience, which can be genuinely informative, but it is not a benchmark you can verify and it should not replace an earnings review and lender underwriting.
Sources
- Ontario College of Pharmacists — Purchase of a Pharmacy
- Ontario College of Pharmacists — Application for Certificate of Accreditation as a Pharmacy
- Ontario College of Pharmacists — Opening a Community Pharmacy
- Ontario College of Pharmacists — Corporate Amendments
- Ontario e-Laws — Employment Standards Act, 2000
- Justice Canada — Excise Tax Act, section 167
- Canada Revenue Agency — GST/HST Memorandum 14-4, Sale of a Business or Part of a Business
- Ontario e-Laws — Business Corporations Act
BUYING A PHARMACY IN THE GTA? LET’S TALK ABOUT THE CALENDAR FIRST
I work on the premises and the lease side of pharmacy purchases in Toronto and across the GTA — the assignment clause, the permitted use, the fit-out constraints the College will assess, and how to sequence a closing date against a 45-day application and a weekday opening. I am not your health-law lawyer and I do not structure share registers. I will tell you, early, where your timeline breaks.
Book a 15-minute call or call or text 833-330-1925.
If you already have a signed agreement with a closing date and no accreditation application filed, call sooner rather than later. That is the conversation I would rather have early than explain late.
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Jatin Dua is Broker of Record and co-founder of RE/MAX Quantum Realty, Brokerage, Unit 101, 799 The Queensway, Etobicoke. Four-plus years in the GTA and more than $100M in sales volume. He works on commercial and business purchases across Toronto and the west GTA.
This is general professional commentary from a Broker of Record on commercial and business acquisitions in Ontario. It is not legal, tax or accounting advice, and it does not create any professional relationship. Whether a licence transfers, how a purchase should be structured, what tax applies and what a regulator will require on your particular file are questions for your lawyer, your accountant and the regulator itself. Rules, fees and published requirements change — verify anything you intend to rely on against the primary source on the day you rely on it.