Insights

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West Virginia retailers are seeking to oust meth makers statewide

CVS/pharmacy replaced single-ingredient pseudoephedrine products with the tamper-resistant PSE product, Zephrex-D, in all of its West Virginia stores, as well as stores in nearby states that are located within 15 miles of West Virginia's border, including Kentucky, Maryland, Ohio, Pennsylvania and Virginia.

 

With the move, West Virginia has become a de facto test market for the diversion-defiant PSE formulation, because along with CVS/pharmacy, Rite Aid and Fruth and soon Walgreens will all be selling similar formulations. The move sends a stern message to West Virginian methamphetamine makers to the tune of Tom Petty's "Don't come around here no more."

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America's bend toward healthier living sparks two big nutrition M&A deals

There were two big deals in the nutrition space this week: Kroger bought one of the most successful VMS e-commerce sites in Vitacost.com, and Hormel bought a dominant nutritional/supplement brand in Muscle Milk. 
 
With Vitacost.com, Kroger will offer customers the convenience to order online and ship to their door with an expanded assortment online. Vitacost.com fields about 45,000 SKUs, and there's a roughly 10,000 SKU overlap when Kroger's mix is factored in.

 

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Walmart taps proven operators to boost its health-and-wellness presence

Just two months after Labeed Diab was named head of health and wellness at Walmart, Mark Phillips was elevated to the role of VP pharmaceutical merchandising. Phillips assumes command of more than 4,175 retail pharmacy operations that generates $16.8 billion in pharmacy revenue, according to DSN's PoweRx 50. In his new role, Phillips will lead the pharmaceutical merchandising team and report to Diab. Phillips, who most recently served as the senior director of merchandising in small formats, is a long-time buyer for Walmart and may be an indication of Walmart's steadfast commitment to growing pharmacy, health and wellness, especially across Walmart's smaller formats.

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Rite Aid fielding four aces with its latest health and wellness hand

There has been a lot of good news generating out of Rite Aid headquarters in Camp Hill, Pa., in the past week. Not the least of which was the 2.7% lift in first-quarter sales and the 3.1% gain in same-store sales for the period. Rite Aid delivered its seventh consecutive quarter of profitability, noted John Standley, Rite Aid chairman and CEO, during a conference call with analysts last week. And Motley Fool’s consumer goods analyst Sean O’Reilly raved about Rite Aid's Health Alliance program, what he described as the company's "ace up its sleeve." O'Reilly noted that the Health Alliance program is designed to drive traffic into Rite Aid's stores through doctor recommendations in the markets where Health Alliance is active. But there's a deeper dive here, because Rite Aid is driving the right customers into its stores — customers with poly-chronic or chronic conditions that represent more frequent trips and bigger market baskets. What's more, Rite Aid's Health Alliance program aims to make those acquired patients more sticky by coordinating a comprehensive care program that will help those patients reach their health goals.

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Sam's Club new credit card offering will boost membership value

Sam’s Club recently announced a credit card cash back program that gives members the opportunity to earn up to $5,000 annually. Marking one of the biggest changes in membership in more than a decade, the club operator in one fell swoop boosted its appeal to loyal Sam's Club members and close the gap between Sam's Club and its chief rival, Costco. The news comes off of a first-quarter performance that Sam's Club president and CEO Rosalind Brewer characterized as “one of our more difficult quarters.” While the club operator was negatively impacted by weather and a reduction in public assistance, Costco emerged under the same conditions with a positive same-store sales comp figure.