Wielding care and service, indie pharmacy holds firm amid economic, profit hurdles
NEW YORK For two decades or more, independent pharmacy owners have been slammed by managed care, steady prescription reimbursement cuts, chain competition and regulatory hurdles. But in the Darwinian struggle of an unforgiving pharmacy market, the strongest are holding firm.
As the 2009 NCPA Digest makes clear, there’s still a big niche in a crowded retail market for independent community pharmacists who remember their customers’ names and personal histories, cultivate relationships with their patients, and go above and beyond with home delivery, in-the-aisle patient counseling or other extra services. The best independents have traded on those services to forge deep and lasting connections with generations of patients, and their roots within thousands of communities across the United States go deep enough to withstand challenges that have staggered some other retail channels.
The Digest findings are somewhat remarkable. In 2008, while the economy froze and a collapse in consumer confidence swept through the retail landscape like a tsunami, the independent segment of retail pharmacy managed a 7.6% average gain in sales, to an average annual total of $3.9 million. The total count of independent drug stores, as measured by the National Community Pharmacists Association, also held steady, at 22,728.
Even more noteworthy: the prospect of owning their own pharmacy continues to draw new proponents among new pharmacy graduates and practicing professionals. More than 1,200 new owner-operated drug stores entered the market last year, NCPA reported.
Where independents lag behind the powerful, deep-pockets pharmacy chains, of course, is in their ability to make high-ticket investments in cutting-edge pharmacy automation, advertising and other expensive retailing and technology tools. But even here, owner-operated drug stores are closing the gap, thanks in part to their participation in pharmacy marketing and franchise programs offered by the largest drug wholesale companies.
McKesson Corp. SVP Tim Canning, who is president of McKesson’s Health Mart franchise pharmacy division, said the support provided by the wholesale and health services giant feeds into the strengths independent pharmacists already wield as community-based patient care specialists.
“By providing our franchisees with access to advanced technology and best-in-class clinical and retail support, Health Mart pharmacists have the time and resources they need to develop relationships with their patients and counsel them on their individual healthcare needs,” Canning asserted recently.
One need look no farther than the latest consumer poll numbers from J.D. Power and Associates to see how well patients respond to that kind of personal attention. Independent pharmacy advocates had to like the results, since consumers surveyed by J.D. Power rated Health Mart and Medicine Shoppe — both of which are owner-operated drug store franchises — tops in overall customer satisfaction. Chain drug store pharmacies, by comparison, scored measurably lower.
All the same, glass-half-empty types could find plenty to fret about in the newest Digest findings. The biggest concern: that indies will lack the negotiating clout and financial reserves to stay ahead of the relentless downward pressure on dispensing margins as PBMs and other third-party payers press their advantage as the dominant source of payments to retail pharmacy.
Closely coupled with that threat is the inescapable fact that the government now accounts for more than half of all prescription reimbursements through Medicare Part D, Medicaid and the Tricare military health program. Further reductions in pharmacy payments by Medicaid or other programs could push many mom-and-pop drug stores over the edge.
FDA approves Diuril generic
SCHAUMBURG, Ill. The Food and Drug Administration has approved the first generic version of an injected drug for hypertension.
APP Pharmaceuticals announced the approval of chlorothiazide sodium, which it plans to launch in fourth quarter 2009.
The drug is a generic version of Lundbeck Pharmaceuticals’ Diuril, a diuretic used for treating hypertension and fluid retention in patients with congestive heart failure, cirrhosis of the liver, kidney disorders and edema.
Diuril had sales of $51 million in 2008, according to IMS Health data.
CVS launches interactive Web and mobile features online
WOONSOCKET, R.I. CVS Caremark is providing customers with more tools to help them manage prescriptions, access health information and save money through new interactive Web and mobile features at CVS.com.
The new CVS.com Mobile (m.cvs.com) provides customers with an on-the-go pharmacy resource to refill, transfer and manage prescriptions. They can also find store locations and take advantage of such features as Savings Central and Virtual Gift Card.
“The new CVS.com Mobile site is a helpful resource for customers who rely on real-time access to their medication history, drug information or simply need help with driving directions or a phone number to a nearby CVS/pharmacy or MinuteClinic,” stated Helena Foulkes, CMO of CVS Caremark. “Additionally, Savings Central provides users with a one-stop online destination for information on health care savings, deals and discounts. These new features, along with the addition of Virtual Gift Cards, are examples of how we are continuing to enhance the customer experience, both in-store and online.”
By visiting CVS.com Mobile, patients can access the Drug Information Center, which allows rapid access to details about medication management, including instructions for use, dosing information, side effects and relevant safety warnings.
Meanwhile, the new Savings Central combines information about healthcare savings with other deals and discounts in one location. By clicking on the “Savings Central” tab, budget-conscious customers can find ways to save money through coupons and special promotions. There are tabbed pages detailing information on such topics as pharmacy savings, circulars, in-store coupons, and online sales and specials.