The move has disappointed Catlins residents.
As a depot, the pharmacy will open five days a week, with prescriptions dispensed from Balclutha and delivered twice daily.
One of the pharmacy's three owners, Margo Roxburgh, said under the existing arrangement a pharmacist was on-site for three days a week, but this was not viable.
When the pharmacy licence came up for annual review it was decided that a depot licence would be sought.
Owaka Plunket member Sandra Grant said the Catlins community fought to avoid the closure of the pharmacy more than four years ago, through it becoming a subsidiary of Elwyn Bates Pharmacy in Balclutha.
"It's gutting, absolutely gutting. We've got a great pharmacy team and we will miss them hugely. Denise [the pharmacist] knows everyone well, and the service is extra special. It feels like we are at the beginning of a slippery slope."
The pharmacy services the wider Catlins area, including Clinton and Tokanui.
Clinical nurse specialist (rural) Kevin Whitney said many prescriptions from Tokanui were sent to Owaka.
"It's unfortunate but it's a business decision made by the pharmacy owners and we'll just have to work around it. Things should carry on as they always have in the past and we will have to wait and see - it may even improve service."
The change to a depot arrangement was mooted earlier this year when there were concerns the pharmacy could not legally operate as both a pharmacy and a depot, and although the Southern District Health Board had allowed a part-time pharmacy operation, it was not financially sustainable.
Under the five-day service Owaka people would still have access to goods traditionally stocked by pharmacies, including pharmacy-only medicines, but there would be no pharmacist on the premises to prepare or dispense medicines.
Mrs Roxburgh said Owaka was not a place where huge population growth was expected - "we couldn't see things were going to get better".
Redeployment negotiations were under way with the pharmacist who had been providing the Owaka service and it was expected that the other two staff would be retained to work in the depot.
Mrs Roxburgh said it was better to provide something that was sustainable in the long term rather than "run the business into the ground", something which would not have done the community any favours.
Lawrence, Tapanui, Mataura and Lumsden were areas which had successfully made the transition to depots as a way of maintaining access to pharmacy services, she said.
The new business will be called Elwyn Bates Pharmacy Catlins Depot. Hours of operation have yet to be confirmed.
