Most of the documents a buyer will ask for already exist somewhere in the pharmacy: the accountant’s office, the filing cabinet behind the dispensary, the landlord’s email from four years ago, the College portal. The work of preparing to sell is mostly the work of gathering them before anyone asks, so that the sale runs on your file rather than the buyer’s questions.
This is the list, grouped by when each item is needed. The download at the end is the same list as a checklist.
Stage one: before the valuation
These set the price. Gather them before you talk to anyone, including us.
Financial statements, three fiscal years and the current year to date. Accountant prepared statements (compilation or review) are what buyers and lenders expect; internal statements are a stopgap.
Corporate tax returns and notices of assessment for the same years. Buyers match them to the statements.
The normalization schedule. A reconciliation from net income to normalized EBITDA, line by line: owner compensation above a market manager salary, personal expenses run through the business, family wages for work not done, genuine one time costs, and any deduction a new owner would face that you do not. Each line needs the amount, the year and a reference to the invoice or ledger entry that supports it. Our EBITDA normalization guide explains which adjustments are accepted. This is the one document most sellers have not prepared, and the one that most affects the price.
Monthly revenue by category for 36 months: dispensary, professional services, front shop, and any long term care, clinic or compounding line. A buyer reads the trend before anything else.
Rebate and professional allowance income by source for three years, where it applies in your province. Buyers and lenders treat it differently from fee income.
Sales tax filings for the last twelve months and bank statements for the same period, which lenders use to verify the revenue.
Stage two: before marketing
These go into the Confidential Information Memorandum and the data room, and they answer the questions a qualified buyer asks after signing the NDA.
Prescription data, aggregated and de identified. Counts by month for 36 months, new and refill; third party payer mix and the share of the largest payer; the top ten prescribers by share of prescriptions, measured from the dispensing system rather than estimated; days supply mix and compliance packaging volume; long term care, clinic or institutional volume by contract. Nothing that identifies a patient leaves the pharmacy before closing.
The lease, with every amendment, renewal and side letter, and the landlord’s contact details. Buyers and lenders read the assignment clause, the change of control clause, the renewal options, the demised area, the permitted use and the current rent with the latest reconciliation. A lease with fewer than five years including renewals is the most common reason a deal is repriced; our timeline guide explains why it is worth renewing before marketing. Our guide to fixing the lease before you list sets out what to pull and what to fix first.
Staff list: role, start date, hours, wage or salary, benefits, and any written contract. Buyers need it to price the business and to plan the transition; employment law in your province decides what transfers.
Hours of operation, and any planned change.
Dispensing and point of sale software, licences and support contracts, and whether they transfer.
Wholesaler agreement, including rebate terms, any minimum purchase commitment and what happens on a sale.
Banner or franchise agreement, and its transfer, consent and termination provisions. Some banner agreements give the banner notice rights or a say in the buyer.
Equipment list with age and whether each item is owned or leased.
Insurance policies and claims history.
Stage three: due diligence
Once a letter of intent is signed, the buyer’s lawyer, accountant and lender work through the file. Have these ready so the period runs to its deadline.
Pharmacy licence or certificate of accreditation, and the most recent College inspection or assessment report with any follow up.
Controlled substance records: reconciliations, destruction records, and any reported loss or theft in the last three years. The federal Controlled Substances Regulations set a two year minimum for records; buyers ask for three.
Privacy policy and any privacy complaint or breach in the last three years.
Complaints, investigations or discipline involving the pharmacy or its pharmacists in the last five years.
Provincial drug plan provider agreements and audit history.
Long term care, clinic, group home or other service agreements, with their assignment provisions.
Supplier and service contracts above a threshold the parties agree.
Litigation, claims or demands, threatened or current.
For a share sale: the minute book, share register, shareholder agreements, and all contracts and liabilities of the corporation, because the buyer takes them on. Our guide to asset sale versus share sale explains why the share route needs the fuller file.
Stage four: closing
The inventory count, by an independent service or jointly, with the agreed exclusions for expired, short dated and damaged stock.
College filings for the change of ownership: in BC the change of direct owner application, at least 30 days before closing; in Ontario the purchase application, at least 45 days before opening under the new owner, with a new Certificate of Accreditation issued; in Alberta the licensee and proprietor changes. The purchase agreement sets who files what.
Landlord’s consent to the lease assignment or the change of control, signed.
Provider number changes with the provincial drug plan and third party payers, so claims are paid to the right owner from day one.
Wholesaler and banner account transfers, bank account changes, payroll transfer, software licence transfers, keys, alarm codes and signage.
The transition plan for the vendor’s period after closing: hours, duties, introductions to prescribers and institutional clients, and the message to patients and staff, which both sides agree.
Three habits that make the list easier
Keep a running file. A folder, physical or digital, with the current lease, the current staff list, the licence, the last inspection report and the latest statements. Updated once a year, it is most of stage two.
Let your accountant build the normalization schedule now, not when a buyer is waiting. The add backs are easier to document in the year they happen.
Measure the prescriber and payer shares from the system, not from memory. Buyers and lenders will, and a seller who already has the figures controls how they are presented.
The checklist
The download is the full list above as a checklist, with a column for where each document is kept and whether it is ready.
Download the pharmacy sale document checklist (Word)
If you want the file reviewed before it goes to a buyer, that is stage one of a managed sale, and the preparation is the part of the process that most changes the price.