Proposed merger threatens community pharmacies

November 14, 2011
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The sought-after merger of pharmacy benefit management companies Express Scripts Inc. and Medco Health Solutions Inc. casts prescription drug users’ health into jeopardy, violates anti-trust laws, and threatens to reduce the number of independent pharmacies, said Hank Fuhs, chairman of the Michigan Pharmacies Association PAC and a Michigan member of the Preserve Community Pharmacy Access NOW!, a nationwide coalition of consumers, businesses and community-based pharmacists fighting the merger.

The merger between Express Scripts and Medco Health, now under review by the Federal Trade Commission and subject to congressional inquiry, violates a body of anti-trust laws that disallows anti-competitive measures and unfair business practices intended to protect consumers, said Fuhs, who also works part-time as a pharmacist for a Walgreens drug store in Grand Rapids.

PCHA NOW! instead is advocating for Congress to pass the proposed Pharmacy Competition and Consumer Choice Act of 2011 and the Preserving Our Hometown Independent Pharmacies Act to boost patients’ choice of pharmacy.

“These mega mergers are costing small business people and it’s not good public health policy,” said Fuhs. “They’re lying when they say it will save money. They’re looking at the money (it will make for PBMs) and not the people.”

CEOs for Express Scripts and Medco Health, on the other hand, told a House Judiciary Subcommittee earlier this year the merger would make medicines safer, more affordable and more accessible, create a new tool for law enforcement when investigating potentially criminal prescribing or dispensing patterns, close gaps in care, save dollars and lives, and make American businesses more competitive by reducing payroll health-care costs. They also said the merger would help make prescription drugs more affordable to seniors, people with disabilities and working families.

But a heavier reliance on mail order and online ordering business models would mean consumers would not interact with pharmacists, which is important when consumers have questions about their prescriptions, said Fuhs, who’s also secretary of the Michigan Republican Party.

“You’d never have a mail order doctor or a mail order MRI, and you should never be doing that with drugs,” said Fuhs. “Your health is at risk if you do away with the interface with pharmacists at the local market. We can check why you didn’t come in to get your medicine. You might have Alzheimer’s or no way to get in. If you’re middle class and lose your job, where’s your rapport with a pharmacist, where I can ask for resources to get your drugs? If you’re rich, you go to a doctor and pay for it.

“If I don’t see that person face to face, I do them a tremendous disservice,” continued Fuhs. “With that eye-to-eye contact, I can see if someone’s turning yellow, I can see that you’ve got to lose some weight if you’re diabetic and 400 pounds and that’s not good. And you cannot get that on a screen (ordering online).

“They’re very disrespectful of the people when they say you don’t need pharmacists.”

According to the National Association of Chain Drug Stores, the merger between the two PBMs would reduce the options of the “Big Three” if the PBMs were reduced from the current Express Script, Medco Health and DVS Caremark, which control 50 to 60 percent of the national prescription volume, to only two, which would then control more than 40 percent of the national prescription volume. This would require about 135 million Americans (more than one-third of all Americans) to rely on the PBM merger to manage their prescription benefits, posing “significant” anti-competitive threats to numerous U.S. industries and markets, Fuhs said.

Moreover, manufacturers want to include their drugs on a PBM’s formulary, which is a list of medicines that are approved to be prescribed under a particular contract, and in order to do so, they provide discounts and rebates to PBMs, which are not always disclosed or passed on to purchasers of PBM services, such as employers and health plans, according to NACDS.

“Keeping rebates and seeing profits going up 400 percent and wiping out all the competition — that is not good public trust; it’s greed with a capital G and it’s antitrust,” said Fuhs.

Furthermore, according to Fuhs, if the merger is approved, it will mean fewer jobs because the bloodletting will result in a smaller quantity of independent pharmacies, a trend that will only serve to accelerate their dwindling numbers. About 20 years ago, there were 2,000 independent pharmacies operating in Michigan. That number has dropped off to 600 to 700, Fuhs said. In Kent County, there are six independent pharmacies today, when in the middle of the 20th century their numbers averaged 89. The number of independents started to shrink in the 1980s when big box hypermarkets started muscling in for market share of prescription drugs, Fuhs said.

“The bottom line is, it’s not good policy and community pharmacies are getting annihilated,” said Fuhs.

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