Merritt: ‘High Profits, Strong Salaries Refute Longstanding Claims of Financial Hardship From Independent Pharmacy Lobby’

New PCMA Print Advertising Campaign Unveiled

(Washington, DC)—America’s independent pharmacy industry, which has long portrayed itself as “mom and pop” operations struggling against a tide of increasing competition in the retail pharmacy business, is in reality a thriving profession with high profit margins, top-tier salaries, and a legislative agenda that would add hundreds of billions of dollars to the nation’s prescription drug tab, according to a new report released today by the Pharmaceutical Care Management Association (PCMA). PCMA is the national association representing pharmacy benefit managers (PBMs).

” The independent pharmacy lobby continues to seek protection from competition even though they remain very profitable,” said PCMA President Mark Merritt. “With PCMA’s new report, it is more apparent than ever that independent pharmacies are thriving and reaping record profits. Providing the $77 billion dollar independent pharmacy industry with new legislative and regulatory protections would increase prescription drug costs for consumers and employers by hundreds of billions of dollars.”

Independent Pharmacy Lobby’s Agenda Would Harm Consumers

PCMA released the new report, How the Independent Pharmacy Lobby’s Agenda Undermines Competition, Hurts Consumers, and Increases Costs, today at a Washington press briefing. The independent pharmacy industry lobby’s agenda is a veritable special-interest bonanza that would harm consumers and employers by forcing them to pay more for prescription drugs. Specifically, their agenda would:

· Eliminate competition from mail-service pharmacies;
· Dictate contract terms between employers and PBMs;
· Invite fraud by creating special rights for pharmacies to get paid faster than other health care providers;
· Undermine competition by mandating one-size-fits-all contracts between PBMs and pharmacies; and
· Restrict cost-saving tools like step therapy and prior authorization

Independent Pharmacy Industry Thriving with High Profit, Top-Tier Wages

Contrary to their lobby’s claims, the independent pharmacy industry is thriving. In developing the report about the independent pharmacy success story, PCMA analyzed the independent pharmacy industry’s own published data. Among the key findings contained in the new independent pharmacy report:

· Independent Pharmacy Lobby’s Agenda Would Add Billions to Nation’s Drug Spend. The independent pharmacy lobby is pushing special-interest bills nationwide that would restrict competition among retail pharmacies; limit competition from mail-service pharmacies; and create inappropriate relationships and conflicts of interest between retail pharmacies and PBMs.

· Independent Pharmacies are Flourishing. While independent pharmacy owners claim that PBMs are putting them out of business, their data show that sales and profits have soared, especially in rural areas.

· Independent Pharmacy Owners are Among the Nation’s Elite Wage-Earners. Independent pharmacy owners are among the top four percent of US wage earners. Newly minted pharmacists can expect signing bonuses running into thousands of dollars and often enjoy six-figure starting salaries.

· Independent Pharmacies Use Group Purchasing Power. The vast majority of independent pharmacies nationwide belong to independent pharmacy purchasing groups (IPGs), sophisticated organizations that give them tremendous bargaining clout with manufacturers and PBMs. Through IPGs, independent pharmacies secure market-share rebates.

· Independent Pharmacies Earn Highest Profits from Uninsured Consumers. Independent pharmacies earn their highest gross profit margins â?? a staggering 40 percent â?? off of uninsured consumers and seniors without prescription drug coverage.

In addition to this report, PCMA also released a new paper, How Pharmacy Benefit Managers Help Employers Provider Safer, More Affordable Prescription Drugs, that highlights the value that PBMs provide to employers. The paper documents the tools PBMs rely upon to lower drug costs an average of 25 percent and ties together disparate PBM cost-savings data from PricewaterhouseCoopers, the Government Accountability Office, the Congressional Budget Office, the Federal Trade Commission, and other industry and government sources.

To help raise awareness about the independent pharmacy lobby’s agenda, PCMA has also launched a new print advertising campaign. Running inside the Beltway and entitled, “Think Again,” the advertisement asks the question, ‘Think you know the independent pharmacy industry?’ and sets the record straight about the industry’s profitability and wages.

The full report and a copy of the new print advertisement are attached below.
How Pharmacy Benefit Managers Help Employers Provide Safer, More Affordable Prescription Drug Benefits (April 2005)

How the Independent Pharmacy Lobby’s Agenda Undermines Competition, Hurts Consumers, and Increases Costs (April 2005)

Think you know the independent pharmacy industry? Think again (April 2005)

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The Pharmaceutical Care Management Association (PCMA) is the national trade association representing America’s pharmacy benefit managers (PBMs). PCMA member companies provide pharmaceutical care management services to more than 200 million Americans.

Contact Information:
Phil Blando
202-207-3614