PHARMACY

Health Mart, more than 2,000 strong, building franchise’s drawing power

BY Jim Frederick

Health Mart
President: Tim Canning
Corp. Offices: San Francisco
Number of Members/Stores: 2,000
Web page: www.healthmart.com

In late 2008, retail pharmacy’s fastest-growing franchise for independent owner-operators blew past a significant milestone with the addition of its 2,000th drug store member.

Owned and operated by McKesson Corp., Health Mart has staged an impressive, coast-to-coast rollout since its relaunch in June 2006, growing more than 500% and emerging as a nationally recognized pharmacy brand. The concept is appealing both to customers drawn to the personal care provided by its independent pharmacist owners and to the owners themselves.

Customers are giving the concept high ranks for personalized service, rating Health Mart No. 1 in overall pharmacy customer satisfaction in the 2008 WilsonRx Pharmacy Satisfaction Survey from Boehringer Ingelheim Pharmaceuticals. And hard-pressed independent drug store owners who buy into the concept are looking to membership in a franchise network backed by McKesson’s deep pockets, merchandising expertise and business resources. In a time of economic peril, particularly, they’re looking to the concept as a way to bolster their business amid blistering competition from chain pharmacy retailers.

Health Mart president Tim Canning said McKesson projects continued growth for the franchise, but he indicated the focus has shifted to boosting store services and capabilities for the existing store network.

“We want to make sure we’re adding the right stores to our Health Mart base,” Canning said. The strategy, he added, is “to present a cohesive network of pharmacies that comply with the Health Mart vision, and that will engage with their patients.

“Our growth continues: we’re over 2,000 stores now, and we’re one of the major national pharmacies,” he told Drug Store News. “Now we’re starting to focus on helping our stores, as their business is challenged, and trying to empower them to be successful across three fundamental business principles.”

Those principles, said Canning, are simply stated: “To help them attract new customers, maximize existing customers already in the store and enhance their business efficiency.”

Along those lines, said Health Mart’s president, McKesson’s Reimbursement Advantage program, an automated reimbursement optimization system, can help level the playing field with big chain retailers and help keep independent pharmacies in the game. “In this environment, those types of things are more critically important to an independent business operator,” he said. “We have almost 800 Health Mart stores on it right now, and it’s the industry’s most comprehensive reimbursement optimization package.”

The system can increase a pharmacy’s net profit by an average of $1,250 a month, Canning asserted.

McKesson also provides such financial services as automated claims resubmission and pricing and profitability analytics, as well as customer care services and other tools.

Health Mart also is expanding its Diabetes Life Center, an in-store merchandising concept exclusive to Health Mart stores. The merchandising and marketing concept ties together a broad array of products and gives them a high profile, clearly identified home within the drug store.

The Diabetes Life Center is open to any Health Mart franchisee for a one-time fee of $300. In return for that fee, stores can draw on a variety of tools to market more effectively to diabetics.

The Diabetes Life Center resources include professional merchandising support, such as planograms and promotions; marketing support, with a consumer Web site and an online marketing toolkit; department signage; access to a broad selection of glucose-testing supplies and OTC products; a quarterly newsletter for patients called Take Control: Diabetes; brochures and literature from suppliers; and other aids.

“Being able to serve the diabetic patient is so important to community pharmacy,” Canning said. “This is a way of attracting new diabetic customers in your area, letting them know the Health Mart pharmacy is a place to go to for care.”

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PHARMACY

Rhode Island develops prescription savings program for residents

BY Alaric DeArment

PROVIDENCE, R.I. Residents of Rhode Island can save an average 30% on prescription drugs using a card issued to them free of charge.

The card, RIRx, is similar to prescription drug cards issued in several states already through a non-profit program administered by United Networks of America. The cards are accepted at more than 54,000 national and regional pharmacies, according to the program’s Web site, www.FreeDrugCard.us.

The Greater Providence Chamber of Commerce will seek to create awareness and distribute the cards.

“The cost of healthcare is a top concern for Rhode Island’s residents,” chamber president Laurie White stated. “With unemployment on the rise, due to the stalling economy, many individuals and families are finding themselves without health insurance.”

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Anti-crime measures in Congress win strong endorsement from NACDS

BY Jim Frederick

WASHINGTON Congress is moving on two fronts to combat organized crime against pharmacies and other retailers, generating strong praise from chain pharmacy leaders.

The National Association of Chain Drug Stores Friday issued a letter to Reps. Brad Ellsworth, D-Ind., and Jim Jordan, R-Ohio, in support of their introduction of H.R. 1173, the Organized Retail Crime Act of 2009. The bill would define organized retail crime and expand fraud statutes to include the illegal use of gift cards, Universal Product Code labels, or radio identification transponders.

The Ellsworth-Jordan bill also recommends that the United States Sentencing Commission review and amend the sentencing guidelines for convicted organized retail crime offenders.

H.R. 1173 has gained bi-partisan backing from co-sponsors including Reps. Arthur Davis, an Alabama Democrat, and Republicans James Sensenbrenner Jr. of Wisconsin, John Kline of Minnesota and Mike Rogers of Michigan.

“This strong bipartisan legislation will help to stem the growing problem of organized retail crime, by providing much needed clarity within the U.S. criminal code to prosecute such criminal behavior as a federal felony, including facilitation of such illegal activities,” NACDS president and CEO Steve Anderson told lawmakers in his letter Friday. “As you know, organized retail crime is responsible for over $30 billion in losses annually, resulting in increased costs for merchants, higher prices for consumers, and lost tax revenue for state and local governments. In addition to increased costs faced by retailers to cover losses and investment in additional security measures, consumers are placed at risk when package tampering occurs on consumer health care products, such as infant formula and OTC medications.”

NACDS, Anderson pointed out, “has long advocated for federal legislation that treats theft committed by organized, professional crime rings as a federal felony, especially since much of the stolen product is transported across state lines.”

Besides arming federal law enforcement officials with “the authority to pursue and prosecute individuals who engage in such criminal activities,” Anderson noted, the Ellsworth-Jordan bill “also targets criminals’ use of online marketplaces to sell the fruits of organized retail crime to unsuspecting consumers and establishes specific and narrow obligations for operators of online marketplaces.”

The chain pharmacy organization also endorsed H.R. 1166, the E-Fencing Enforcement Act of 2009. In a letter sent Friday to Rep. Bobby Scott, D-Va., who is chairman of the House Subcommittee on Crime, Terrorism and Homeland Security, Anderson thanked Scott for introducing the measure.

“Your legislation will help to stem the growing problem of the use of online marketplaces by criminals to redistribute stolen merchandise, including those obtained through organized retail crime,” Anderson told the lawmaker.

H.R. 1166 would prosecute the electronic fencing of stolen products, and empower retailers to seek relief against high-volume sellers who engage in the e-fencing of stolen merchandise.

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