Credit Suisse: Rising gas prices may rev drug engine
NEW YORK — Drug stores may be best positioned to navigate any headwinds whipped up by rising fuel costs and may even benefit from them, a Credit Suisse analysis published Friday found.
“We expect the industry to fully pass through front-end inflation and see no material impact from higher gas prices,” wrote Credit Suisse research analyst Ed Kelly. “Consequently, we remain positive on the drug stores and view the group as one of the most attractive sectors in retail today. [The channel] provides insulation from inflationary headwinds, possesses a unique industry catalyst in the 2012 generic wave, [CVS Caremark and Walgreens] have company-specific drivers of upside, and valuations are still reasonable.”
As a channel, drug stores have been most successful in passing through product cost inflation, especially considering the weak relationship between price and volume at drug stores vs. supermarkets or overall retail, Kelly wrote. “In other words, drug stores historically have passed through inflation without a meaningful decline in volume. We attribute this success to the fact that the industry competes on convenience more than price, has a natural flow of pharmacy traffic and has a low average ticket.”
Kelly noted that Walgreens’ front-end comps have either been stable or actually accelerated during each of the last five spikes in gas prices, including the 2008 summer peak above $4 per gallon.
Credit Suisse is projecting a conservative 2.5% front-end same-store sales growth across both CVS and Walgreens, though comparable-store sales growth of between 3% and 5% front-end comps wouldn’t be out of the question, Kelly added.
Takeda’s Edarbi enters market
DEERFIELD, Ill. — Takeda Pharmaceutical has launched a new treatment for high blood pressure, the company said Friday.
Takeda announced the launch of Edarbi (azilsartan medoxomil), which the Food and Drug Administration approved on Feb. 25 as a once-daily pill for hypertension.
“Hypertension is a serious condition but typically does not have any symptoms, and many aren’t aware of the long-term impact hypertension has on cardiovascular health,” Takeda Pharmaceuticals North America executive medical director of medical and scientific affairs Paulos Berhanu said. “We are pleased to make available Edarbi, an important new treatment option for patients with hypertension and the healthcare professionals who treat them.”
NCPA: Pharmacists can help combat Rx drug abuse
ALEXANDRIA, Va. — Local pharmacists work with patients and law enforcement to combat the abuse of controlled substances and other prescription drugs, but changes to federal policy are needed to allow pharmacists to play a greater role, the National Community Pharmacists Association suggested Thursday in comments submitted to Congress.
“NCPA is committed to working with members of Congress and state and local law enforcement officials to combat the inappropriate use and diversion of prescription drugs, and is committed to working toward sensible solutions,” the association stated in comments to a U.S. House Energy and Commerce Subcommittee holding a hearing entitled “Warning: The Growing Danger of Prescription Drug Diversion.”
In the comments, available in their entirety here, NCPA made the following points:
Community pharmacists support national and local efforts to prevent the abuse of both prescription and nonprescription drugs, at the same time recognizing that Congress should not diminish access to effective pain treatments for people who need them;
Community pharmacists provide vital patient counseling to help ensure that these medications are not misused, abused or diverted; and
Consumers want ongoing, convenient and clear drug disposal options, and find local pharmacies to be the most convenient location to return unused or expired medicines.
The NCPA suggested that the Drug Enforcement Administration should consider community pharmacies — already licensed by the DEA and the state — as appropriate locations to receive unused controlled substances from patients. To date, more than 1,200 community pharmacies voluntarily are participating in NCPA’s Dispose My Meds disposal program and collected more than 25,000 lbs. of unused or expired medications in the past year alone; however, no one can accept controlled substances.