Boards were paying for the drugs in the first instance, and then paying again to dispose of them.
"It's a crazy system," the Otago and Southland District Health Boards' community and public health advisory committee member said yesterday.
Prescriptions being issued for medicines such as aspirin and paracetamol which people often used to buy at the supermarket was a major reason for increases in medicines dispensed, he said.
Mr Barron told the committee meeting yesterday this was the result of a change in access criteria for patients.
Patients could end up with 700 paracetamol tablets.
Solutions were likely to be found locally rather than nationally to the situation, he said.
His comments arose during discussion of a recent letter sent to Otago and Southland GPs appealing to them to exercise prescribing restraint where possible to help reduce the two district health boards' spending in this area.
Board and committee chairman Errol Millar said the letter was not saying GPs were not doing their jobs, just asking them to be aware when they wrote prescriptions.
The average spending on prescriptions in Otago and Southland was above the national rate.
Committee member, Balclutha GP Dr Branko Sijnja, said it could be useful for general practitioners to be given some "broad brush" information about areas where prescribing could be improved.
When doctors were seeing a patient who was picking up medication regularly, but not improving, then they needed to ask if patients were taking the medication.
* It now appeared that only two pharmacies in Otago and Southland would not have their contracts with the district health boards signed by the end of this month, senior planning and funding manger Glenn Symon told the meeting.
Both pharmacies had not engaged with the board over the new contract.
If pharmacies have not signed by April they will not be paid by the board for drugs dispensed or the dispensing fee.
Pharmacies outside the contract would have to decide what to charge for the medicines and dispensing them.
Committee members asked how people would know if their pharmacy was one of the two concerned.
General manager of planning and funding David Chrisp said he was optimistic that all pharmacies would be signed up and staff were working hard to achieve that.