Fall out from $4 prescriptions

[b*rizzle]

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What do you guys think the long-term fall-out of this $4 prescription business will be? (For example: I'm at Target, and we're selling a 30 days' supply of metformin 500 mg -- usually #60 -- for a loss of over $22. Where is this money going to come from? It's got to come from somewhere.)

I mean, from a business perspective, it was a smart move. From a practical perspective, I think it was a disaster. Do you guys think this will last?

 

[MountainPharmD]

Cost for a 30 day supply of metformin 500mg, 1 BID is about $2.20. Every drug on Wal-Mart's $4 price list is dirt cheap. The only fall-out is for the poor Pharmacists who work for Wal-Mart. They are the ones left to deal with all the idiots who come in a want all there RX's for $4.00 each. All I see is problems for them.

As a competitor we already price match Wal-Mart and Sam's Club. Funny thing is all we ever price match is controlled substances. All contolled substances were notably absent from Wal-Mart's list.

 

[genesis09]

Sometimes, with the $4 Wal-Mart deal, the cost for the medication is higher than at Walgreens or Osco, etc. As stated so many times before, the drugs on the list are old, extremely cheap drugs. This is a publicity stunt.

 

[Shmy2008]

Nobody cares about the pharmacy in mass retail stores... and by "care," I mean that the pharmacy isn't seen as a big money maker, regardless of the department's productivity and/or actual profit. The pharmacy is inserted into the mass retail scheme in an effort to nab those customers that wouldn't normally come into the store were it not for the pharmacy. "Oh boy! I have a prescription... now, where am I going to get this filled? I know, I'll go to WalMart, where they have that $4 generic deal that may or may not apply to me... what's that you say? They sell socks for little Jimmy AND garden hoses for me to use for my yardwork? I'm there!"

Everybody's probably been a victim of this clever loss-leader scheme before... why, just this weekend I went to WalMart to get my oil changed. In the TWO HOUR wait, I spent more than $50 at the Evil Empire... on things I could have bought at my employer (that other large mass retailer that doesn't have a tire/lube department) and gotten a discount on. Clever how that loss-leader marketing works...

 

[DrugDealer]

What do you guys think the long-term fall-out of this $4 prescription business will be? (For example: I'm at Target, and we're selling a 30 days' supply of metformin 500 mg -- usually #60 -- for a loss of over $22. Where is this money going to come from? It's got to come from somewhere.)

I'm doing a rotation at Target, and while they do sell 60 metformin 500 mg tabs for $20-something (varies slightly depending on the area and what other pharmacies are around), the actual cost in the computer is less than $4. That is like the only thing I like about the Target computer system--it shows you the actual price Target paid, what they sell it for, and the profit margin. We could only find a handful of drugs where Target's cost for the 30-day supply was greater than $4.

 

[bananaface]

I am just waiting until they bring the program here to WA where it's illegal to advertise the price of your prescription drugs. It's possible that NCPA will pursue a lawsuit here or in another state with a similar law. Their press releases are already agressively antagonistic.

 

[cycloketocaine]

I am just waiting until they bring the program here to WA where it's illegal to advertise the price of your prescription drugs. It's possible that NCPA will pursue a lawsuit here or in another state with a similar law.

That's an interesting point......

 

[museabuse]

Sometimes, with the $4 Wal-Mart deal, the cost for the medication is higher than at Walgreens or Osco, etc. As stated so many times before, the drugs on the list are old, extremely cheap drugs. This is a publicity stunt.

I don't know where you get this info from because from what I know the cheapest cash price osco(CVS) can sell a drug is 10.99 and I believe walgreens is 11.99. THis means if there is a presciption for #1 diazepam then the cost to the patient without insurance is $10.99. It was 7.99 with Osco but now that they are CVS it is 10.99. I think I learned in pharmacy management that this is the minimum price for an RX to reach a breakeven point... ie break even after all the salary, rent, and operating expenses are paid. I am probably wrong... but yeah the 1 diazepam costs the pharmacy .02 cents but thats not what they are going to sell it at.
There was a memo at my store that CVS will not price match anywhere without pharmacy supervisor ok. That makes it easier for me... no more calling sams club or costco.

 

[ndearwater]

You guys need to watch the documentary "Walmart: The High Cost of Low Prices". My eyes are seriously opened. I will NEVER shop at Wal-Mart again!
I don't have money to throw around but I refuse to shop there regardless of their "rollback prices".
The reason their merchandise is cheap is because it's more cost efficient to let a Chinese sweat shop produce it for $0.18/ hour than to pay an American for the same service.
Also, they don't have to pay their employees health insurance. You pay for it. It's called Medicaid.
Okay sorry about the rant.
I agree, the $4 thing, when evaluated closer is not cutting profits. The expensive generics will remain expensive.

 

[SobeGekko]

You guys need to watch the documentary "Walmart: The High Cost of Low Prices". My eyes are seriously opened. I will NEVER shop at Wal-Mart again!

Ditto!! Great Documentary!!

 

[sdn1977]

What do you guys think the long-term fall-out of this $4 prescription business will be? (For example: I'm at Target, and we're selling a 30 days' supply of metformin 500 mg -- usually #60 -- for a loss of over $22. Where is this money going to come from? It's got to come from somewhere.)

I mean, from a business perspective, it was a smart move. From a practical perspective, I think it was a disaster. Do you guys think this will last?

Where is the money coming from??? From the other merchandise Walmart sells.

Will it last??? No.

Walmart, like CVS, Target, Walgreens...all have the prescription depts running at a loss. The poster who said it costs $10 for an rx...well...it costs a whole lot more than that, but that is what the corporation would like to charge to make the depts balance. But...they never balance. That number is based upon the standard AWP + fee less a flat amt which is the negotiated insurance/medicare/medicaid price of an rx. The rx is always at a loss from GMC - our inventory is too high, our salaries are too high & our hours are too long to make it profitable - hence the loss of the smaller retail pharmacies which don't have the huge front end to make up the difference.

However...one part of marketing is getting your name out where people can see it. Walmart is tremendously effective in that. This $4 rx pricing, the Plan B controversy, the no-benefit employee information all have the commonality of putting the Walmart name out there.

People go to Walmart who might never go there just to see what the controversy is. Those who have a marketing background know that if you can get someone thru the front door, you have a chance to make a sale. If the sale is received positively, you have a chance to get them back.

I don't advocate them because they are not advocates of pharmacy, but they are very effective in marketing.....so I guess I must respect that - as I do used car salesmen🙄 .

 

[letjin]

Walmart, like CVS, Target, Walgreens...all have the prescription depts running at a loss.

When I interned at Walgreens this summer, they made a point to say their pharmacy department is the most important to them & more than 50% of the store's profit come from pharmacy. So I don't think at least Walgreen's pharmacy department is running at a loss.

 

[Sosumi]

When I was interviewing with the pharmacy supervisors/recruiters last weekend, I was told by them that the big 3 retail chains (CVS, Rite-Aid, and Walgreens) all rely heavily on their pharmacy department for revenue (around 70%). This is for me a big positive for working for them since you, as the pharmacist, are the big fish and have more authority than the store manager, unlike at the supermarkets -- (the Giant supervisor said they make about 20% from pharmacy) -- and big department stores (Wal-Mart said about 7% and Target about 1 to 2%).

Thus the big retail chains don't sound like they are or can afford to operate at a loss as much as the department stores. If Wal-Mart's $4 generic prescriptions goes nationwide, it might impact the industry heavily. Which is a shame since they have so many other positives for working for them, except for the fact that they're the big Evil Empire.

 

[DrugDealer]

When I was interviewing with the pharmacy supervisors/recruiters last weekend, I was told by them that the big 3 retail chains (CVS, Rite-Aid, and Walgreens) all rely heavily on their pharmacy department for revenue (around 70%).

Depends where you are in the country. That stat is pretty typical for the east coast stores, but the numbers are bascially reversed on the west coast. Things are newer here, there's more land, stores are much bigger, and the front-end drives the store. I was an assistant manager at RiteAid in Orange County, CA before heading to pharmacy school, and my store was the size of some supermarkets. On the weekends, our alcohol sales $ were much higher than our pharmacy sales $. Sure, the pharmacy was important, but we focused more on selling lawn furniture and Xmas trees.

 

[All4MyDaughter]

When I interned at Walgreens this summer, they made a point to say their pharmacy department is the most important to them & more than 50% of the store's profit come from pharmacy. So I don't think at least Walgreen's pharmacy department is running at a loss.

It is by FAR the more profitable part of one of the stores I work at. I've seen the financial statements but can't remember specifics. I'm probably not supposed to discuss them anyway, haha!

The other store I work at is new and only fills 100-120 per day. Don't know how pharmacy revenue compares to self-service revenue in that location.

 

[MountainPharmD]

When I was interviewing with the pharmacy supervisors/recruiters last weekend, I was told by them that the big 3 retail chains (CVS, Rite-Aid, and Walgreens) all rely heavily on their pharmacy department for revenue (around 70%). This is for me a big positive for working for them since you, as the pharmacist, are the big fish and have more authority than the store manager, unlike at the supermarkets -- (the Giant supervisor said they make about 20% from pharmacy) -- and big department stores (Wal-Mart said about 7% and Target about 1 to 2%).

That is completely backwards thinking. The first thing you will learn at a retail chain is the store manager runs the store and you work for him/her. They could care less about you being a pharmacist. They know there are 10suckers out there who just graduated who will fall for the big bonus and starting salary to take your place.

The next thing you will learn is the big 3 retail chains (CVS, Rite-Aid, and Walgreens) have a store manager that gets a big bonus based on total store sales. Some store managers the bonus is over half their salary. So you better believe if the pharmacy accounts for 70% of sales they will be in your **** all the time. Plus the managers and assistants are required to be certified technicians. This makes them twice as dangerous because they think they know what they are doing.

Now take your average grocery store pharmacy which accounts for 10% to 15% of overall store sales. The grocery store manager also gets a bonus based on store sales. Of total store sales the Grocery department = 30-40%, Produce = 20-25%, Meat = 15-20% and General Merchadise = 15-20%. If the store manger is going to mess with someone it isn't the Pharmacy. In fact most managers in a grocery store figure out of sight out of mind when it comes to Pharmacy. We are the liitle space over in the corner that makes lots of money so they leave us alone.

 

[letjin]

The next thing you will learn is the big 3 retail chains (CVS, Rite-Aid, and Walgreens) have a store manager that gets a big bonus based on total store sales. Some store managers the bonus is over half their salary. So you better believe if the pharmacy accounts for 70% of sales they will be in your **** all the time. Plus the managers and assistants are required to be certified technicians. This makes them twice as dangerous because they think they know what they are doing.

The manager thing is somewhat true in Walgreens. The store manager & assistant managers are called Mr. Smith etc and pharmacists are called by their first name (some of them Doctor of Pharmacy). However...in walgreens managers having pharm tech licences only helps - they need to come collect drawers and you need a licence to stepa foot in a pharmacy & they come help out when we are really busy back here.

 

[All4MyDaughter]

That is completely backwards thinking. The first thing you will learn at a retail chain is the store manager runs the store and you work for him/her. They could care less about you being a pharmacist. They know there are 10suckers out there who just graduated who will fall for the big bonus and starting salary to take your place.

The next thing you will learn is the big 3 retail chains (CVS, Rite-Aid, and Walgreens) have a store manager that gets a big bonus based on total store sales. Some store managers the bonus is over half their salary. So you better believe if the pharmacy accounts for 70% of sales they will be in your **** all the time. Plus the managers and assistants are required to be certified technicians. This makes them twice as dangerous because they think they know what they are doing.

Now take your average grocery store pharmacy which accounts for 10% to 15% of overall store sales. The grocery store manager also gets a bonus based on store sales. Of total store sales the Grocery department = 30-40%, Produce = 20-25%, Meat = 15-20% and General Merchadise = 15-20%. If the store manger is going to mess with someone it isn't the Pharmacy. In fact most managers in a grocery store figure out of sight out of mind when it comes to Pharmacy. We are the liitle space over in the corner that makes lots of money so they leave us alone.

My experience at Walgreens has been different. Store management is not too involved in our pharmacy, except when we call them to come back and help with the register (IC3 in the pharmacy!).

I've also worked at two different Krogers where the store managers were ALL up in the pharmacy business.

I think it depends more on the personalities involved.

Walgreens pharmacy managers also have a bonus structure in place based on pharmacy sales.

 

[MountainPharmD]

The manager thing is somewhat true in Walgreens. The store manager & assistant managers are called Mr. Smith etc and pharmacists are called by their first name (some of them Doctor of Pharmacy). However...in walgreens managers having pharm tech licences only helps - they need to come collect drawers and you need a licence to stepa foot in a pharmacy & they come help out when we are really busy back here.

Never met a Walgreens manager that was very happy when they had to go "help out" in the pharmacy. Most managers are only certified because they have to be. This usually means they did the minimum amount of studying required to pass the test. At CVS the techs and managers do not even have to pass the national certification test. CVS has their own certification process.

You do not need a license of any kind to step into the pharmacy or to work in the pharmacy, hence the term ancillary personnel. This is how Walgreens gets away with staffing one Pharmacist and six techs. Three of the "techs" are designated as ancillary personnel. Really what they need is two Pharmacists and three to four techs.... I digress, thats a topic for another thread.........👎

 

[Sosumi]

That is completely backwards thinking. The first thing you will learn at a retail chain is the store manager runs the store and you work for him/her. They could care less about you being a pharmacist. They know there are 10suckers out there who just graduated who will fall for the big bonus and starting salary to take your place.

The next thing you will learn is the big 3 retail chains (CVS, Rite-Aid, and Walgreens) have a store manager that gets a big bonus based on total store sales. Some store managers the bonus is over half their salary. So you better believe if the pharmacy accounts for 70% of sales they will be in your **** all the time. Plus the managers and assistants are required to be certified technicians. This makes them twice as dangerous because they think they know what they are doing.

That has not been the case in my experience with Rite-Aid where I've interned at 7 different stores for them. The store managers rarely check up on the pharmacy unless you're really backed up and need them to give you a clerk. My regular store has a big front end (it used to be a Hecht's), but the store manager and pharmacy manager are very distinct. Even when the regional store supervisor comes, he has very little input into pharmacy operations even if he believes he does. Your boss is really the pharmacy district and regional managers.

Since Rite-Aid has so many stores in the Baltimore area, the pharmacist shortage is so immense that pharmacists appear more valued, and the store managers know it. This is from the pharmacy managers I've spoken with while I worked at their stores.

It's probably different with Walgreens since they're so corporate *shrug*.

 

[sdn1977]

Never met a Walgreens manager that was very happy when they had to go "help out" in the pharmacy. Most managers are only certified because they have to be. This usually means they did the minimum amount of studying required to pass the test. At CVS the techs and managers do not even have to pass the national certification test. CVS has their own certification process.

You do not need a license of any kind to step into the pharmacy or to work in the pharmacy, hence the term ancillary personnel. This is how Walgreens gets away with staffing one Pharmacist and six techs. Three of the "techs" are designated as ancillary personnel. Really what they need is two Pharmacists and three to four techs.... I digress, thats a topic for another thread.........👎

Different here in CA - you have to be a pharmacy staff person to even enter a pharmcy without permission from the pharmacist. No manager can enter the pharmacy EVER without our permission & we just don't give it.

My experience is like Sosumi's - the pharmacy corporate structure is separate & distinct from the store's structure.

However...their bonuses are tied to our profit capability.....

 

[MountainPharmD]

Different here in CA - you have to be a pharmacy staff person to even enter a pharmcy without permission from the pharmacist. No manager can enter the pharmacy EVER without our permission & we just don't give it.

My experience is like Sosumi's - the pharmacy corporate structure is separate & distinct from the store's structure.

However...their bonuses are tied to our profit capability.....

Yes, technically that is correct every where. See how well things go for you if you do not let the manager into the Pharmacy. Not a smart move since the store manager is in charge of your budget, ie. your hours, the schedule, vactions ect.

 

[alwaystired]

Yes, technically that is correct every where. See how well things go for you if you do not let the manager into the Pharmacy. Not a smart move since the store manager is in charge of your budget, ie. your hours, the schedule, vactions ect.

they may have some control, but where you choose to work, the ultimate decision, is up to you. if the manager tries to bully you, why don't you just threaten to leave? In my store in this area, with a small shortage of RPh, the manager is not bossing you around....even in a super mega chain.

 

[sdn1977]

Yes, technically that is correct every where. See how well things go for you if you do not let the manager into the Pharmacy. Not a smart move since the store manager is in charge of your budget, ie. your hours, the schedule, vactions ect.

hmmmm.....no! The store manager has nothing to do with my hours, my budget, my schedule, my vacation - nothing! The pharmacy manager carries that responsibility & answers only to corporate pharmacy.

We are separate & distinct from the store & yes...they are NOT allowed in the pharmacy.

About 4 years ago there was a rash of young arrogant store managers who "bullied" their way into pharmacies & the corporation came down hard & fast on them with memos, discipline & in one instance...the state board was called in. In fact...our state board has been citing pharmacies which are not locked at all times as well as having people in the pharmacy who are not HIPAA certified, which our store manager is not.

So...at least in my corporation....there is a distinct separation between the two areas, not just in access & accountability, but also in age & salary. The pharmacists are generally older & always the highest paid employee in the store.

 

[All4MyDaughter]

Yes, technically that is correct every where. See how well things go for you if you do not let the manager into the Pharmacy. Not a smart move since the store manager is in charge of your budget, ie. your hours, the schedule, vactions ect.

At least with Walgreens and Kroger, staffing patterns, hours, vacations, etc. are handled by the pharmacy district manager (Kroger) or pharmacy coordinator (Walgreens). Not under the control of store management.
Although a good store manager can help you advocate for more hours, etc. if that is needed.

All Walgreens store management personnel are certified pharmacy techs and have HIPAA training, so they are allowed to enter the pharmacy (when the pharmacy is open). I've never seen a manager at my store do anything in the pharmacy but help with the register, process returns and (only once) count for a little while during breaks when we were short staffed.

 

[All4MyDaughter]

they may have some control, but where you choose to work, the ultimate decision, is up to you. if the manager tries to bully you, why don't you just threaten to leave? In my store in this area, with a small shortage of RPh, the manager is not bossing you around....even in a super mega chain.

Same here. Major shortage = pharmacist clout.
It's especially hard to find someone willing to be PIC.
If store management is bothering a pharmacist, well - that won't last long.

 

[SomeGuy]

I had to quote this from the Wall on a Facebook group:

I love walmart. They provide low prices at any cost. They practically put a pickle company out of business and it wont just stop there. Who's next? Of course, I would never work for Walmart as a pharmacist. Crappy store discount and I heard their benefits package is nothing to write home to Mom about. As for there low cost prescription scam...I think the fact that they are lowering the cost of chlorthiazide suspension is a very edgy move on their part. I mean, a fast mover such as chlorthiazide...they are going to put everyone else out of business. Just the other day...I tried ordering chlorthiazide suspension from cardinal...yep, you guessed it OUT OF STOCK!!! Man, always on the cusp of the retail pharmacy business, Sam Walton...you genius!!! (I know its publicly owned and Sam is 6 under but, uh, you know what I am getting at, or do you?) Anyway, Walmart's new Pharmacy slogan is..."if you want low prices, and happened to be in Florida, in Tampa specifically, and only get this small list of obscure drugs that no pharmacist under the age of 50 has heard of...come to walmart."

 

[genesis09]

That's fantastic!

 

[b*rizzle]

Where is the money coming from??? From the other merchandise Walmart sells.

Will it last??? No.

.

I know this. But didn't they get in trouble a while ago for selling toys at a loss too?

 

[djquickfingers]

That is completely backwards thinking. The first thing you will learn at a retail chain is the store manager runs the store and you work for him/her. They could care less about you being a pharmacist. They know there are 10suckers out there who just graduated who will fall for the big bonus and starting salary to take your place.

The next thing you will learn is the big 3 retail chains (CVS, Rite-Aid, and Walgreens) have a store manager that gets a big bonus based on total store sales. Some store managers the bonus is over half their salary. So you better believe if the pharmacy accounts for 70% of sales they will be in your **** all the time. Plus the managers and assistants are required to be certified technicians. This makes them twice as dangerous because they think they know what they are doing.

Now take your average grocery store pharmacy which accounts for 10% to 15% of overall store sales. The grocery store manager also gets a bonus based on store sales. Of total store sales the Grocery department = 30-40%, Produce = 20-25%, Meat = 15-20% and General Merchadise = 15-20%. If the store manger is going to mess with someone it isn't the Pharmacy. In fact most managers in a grocery store figure out of sight out of mind when it comes to Pharmacy. We are the liitle space over in the corner that makes lots of money so they leave us alone.

i couldnt agree more. I work at Wags now and the store manager is in the pharmacy's crack 24/7. We do 600+ scripts a day and clearly make the bulk of the store's money. By no means do the pharmacists have any authority or autonomy. They're hands are literally tied and have to look to the store manager to make ANY decisions. The store manager even makes the schedule. Its the complete opposite of what one might think. That's what sucks about pharmacy based retail, like Wags, CVS, rite-aid...you are at the mercy of the store manager because, like the previous poster said, there are many floaters around that will fill the spots of pharmacists if they get too heady👎

 

[MountainPharmD]

i couldnt agree more. I work at Wags now and the store manager is in the pharmacy's crack 24/7. We do 600+ scripts a day and clearly make the bulk of the store's money. By no means do the pharmacists have any authority or autonomy. They're hands are literally tied and have to look to the store manager to make ANY decisions. The store manager even makes the schedule. Its the complete opposite of what one might think. That's what sucks about pharmacy based retail, like Wags, CVS, rite-aid...you are at the mercy of the store manager because, like the previous poster said, there are many floaters around that will fill the spots of pharmacists if they get too heady👎

I was just going to let this thread die but it keeps coming up. Everyone can come up with their one exception. The wonderful store manger who never bothered the pharmacy. My experience with Wags in two different states as an intern and as a staff Pharmacist agrees completly with djquickfingers post above. I know, from my experiences as well as talking to others, that this is the norm for Wags not the exception.

 

[All4MyDaughter]

I was just going to let this thread die but it keeps coming up. Everyone can come up with their one exception. The wonderful store manger who never bothered the pharmacy. My experience with Wags in two different states as an intern and as a staff Pharmacist agrees completly with djquickfingers post above. I know, from my experiences as well as talking to others, that this is the norm for Wags not the exception.

We aren't going to settle this... your experience is no more or less valid than mine. I currently work at two different Walgreens in two different cities and the store manager is not highly involved in the pharmacy at either store. Does that generalize to ALL Walgreens? Probably not.

I still think it depends on the personalities involved. YMMV.

 

[Caverject]

We aren't going to settle this... your experience is no more or less valid than mine. I currently work at two different Walgreens in two different cities and the store manager is not highly involved in the pharmacy at either store. Does that generalize to ALL Walgreens? Probably not.

I still think it depends on the personalities involved. YMMV.

Well...

I too am a former walgreens person that had a meadling store manager that would love to step in and run the pharmacy. When she felt we wern't "busy" she had no qualms about pulling us out to go block the toy isle. She felt like she had that power because she is a pharmacist too. So...when ever a pharmacist didn't want to fill something, she would have no problem asserting her authority and filling the rx in question. Total bullcrap in my opinion and I know many walgreens are like this.

 

[sdn1977]

Well...

I too am a former walgreens person that had a meadling store manager that would love to step in and run the pharmacy. When she felt we wern't "busy" she had no qualms about pulling us out to go block the toy isle. She felt like she had that power because she is a pharmacist too. So...when ever a pharmacist didn't want to fill something, she would have no problem asserting her authority and filling the rx in question. Total bullcrap in my opinion and I know many walgreens are like this.

Now we get to the issue....store managers, who are pharmacists, who reach out beyond what their realm is......store management rather than pharmacy management.

Its not that I don't think they can't do this - they can - certainly a pharmacist has every capability to become an MBA or store manager. However, I do feel they compromise their priorities....like this...when they do this.

My experience with this was not in retail, but in the hospital environment when my dop became a hospital administrator - low level, but an administrator nonetheless. Her priorities shifted & not to our benefit.