`

The Dose

Welcome to The Dose, which tackles the business and economics inside the turbulent world of health care and life sciences in Indiana. Your host is John Russell. To contact me call 317-472-5383.

Drugstores: a few big players rule the roost

February 12, 2016

Ah, the corner drugstore, the staple of every neighborhood, where you can stop in for a cheeseburger and a chocolate shake and maybe discuss your latest ailments with the pharmacist, if he’s not busy filling prescriptions for Mrs. Blaine, whose family has diphtheria.

Oh sorry, I’m channeling George Bailey in Bedford Falls. Those kind of drugstores seem to have nearly disappeared from America, except on your TV on Christmas Eve.

These days, of course, it’s the big pharmacy chains like Walgreens and CVS, along with the supermarkets and big box stores, that run the show.

And increasingly, it’s also mail order and specialty businesses operated by pharmacy benefits managers and payers, including Express Scripts, UnitedHealth, Humana and Cigna.

A new report from the Drug Channels Institute shows just how much financial muscle the major players have. The report ranks the nation’s largest pharmacies by total U.S. prescription-dispensing revenue for 2015.

Of the $364.1 billion in prescriptions filled last year, the top 15 players accounted for 74.3 percent.

The big three retail pharmacy chains accounted for 34 percent of the total:

•    Walgreens:    14.9 percent     ($54.4 billion)
•    CVS Health:    13.8 percent     ($50.4 billion)
•    Rite Aid:    5.3 percent    ($19.3 billion)

Two big mail-order pharmacies accounted for 20 percent of the total:

•    Express Scripts:         11 percent     ($40.1 billion)
•    CVS (mail):        9 percent    ($32.8 billion)

So where is the corner independent drug store on this pie chart? Well, the part of the report we were allowed to see for free doesn’t include the small players. (The full report costs $595 and up.)

To learn more about the size of community pharmacies, we visited the National Community Pharmacists Association website. There, we learned that independent pharmacies rang up $74.9 billion in prescription sales last year. That would represent about 20 percent of the nation’s total prescription revenue.

And speaking of pharmacists, seems like a handshake is in order, whether they work at a big or small outlet. Why? Because Americans think they’re pretty ethical folks.

According to a recent Gallup poll, pharmacists ranked No. 2 for honesty and ethics, behind only nurses. Medical doctors ranked third.

And yes, we know you’re dying to hear what professions are at the bottom of the list. Would you be surprised to know it’s advertisers, car salesmen, members of Congress, telemarketers and lobbyists. Of course you wouldn’t.

Here’s the whole list, in case you’re dying to see where bankers, journalists and funeral directors stack up.
 

ADVERTISEMENT
Comments powered by Disqus