No, it's probably not a bug.
Your Sim probably didn't have the right skills to get accepted for the Distinguished Degree Physics programs when you applied for university. The ordinary degrees are always available, so Sims who don't qualify for a distinguished programs can still get the degree by going to the other university.
The main skills you need to get into the Physics program at Foxbury are Handiness, Robotics, and Rocket Science. These are probably the skills you're learning from your courses at Britechester, which means you will have a good chance of getting into Foxbury next term if you submit another application. I recommend applying about 2 days before the end of your term, so there will be time for your application to be processed. You can check the application on your phone 24 hours after you submit it, in case you don't get the letter in time. You can transfer to the Physics program at Foxbury, once you get accepted there, without losing any credits.