Justin Bryner on LinkedIn: Pharmacy Chains Are in a World of Hurt. Blame Shrinking Drug… (2024)

In eight years, national pharmacy chains have gone from an invasive species to an endangered one.They arrived in the 1980s like a beetle to a hardwood forest, burrowing into virtually every suburban strip mall, rural township, and urban business district in the U.S. By 1990, there were 18,600 chain pharmacies across the country; by 2010, there were more than 22,500.After having some great years, their entire business is now under pressure. You can see it in the October bankruptcy filing ofRite Aid, the third-largest of the U.S. chains; in the share price of CVS, which is down more than 30% over the past two years; in the unrest among chain pharmacists, who have heldsporadic walkouts in some cities.Turning the chains around won’t be easy. Their biggest problem has been the declining reimbursem*nt rates that pharmacy-benefit managers pay them for the prescription drugs they sell, says John Ransom, an analyst who covers Walgreens for Raymond James. Those cost pressures are unlikely to disappear.

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A #pharmacist this week told me that the pharmacy was reimbursed a total of $0.57 for one claim from a big 3 #PBM last week.That was for the ingredient cost AND the dispensing fee, both. Combined.Folks, that's not a sustainable business model.If you want to have #pharmacies available to you in your hometown, we all need to start paying attention to the stranglehold that larger PBMs have taken on pharmacies.You DO have the power do something about it too, like:-If you're in HR, please shop around for PBMs that have sustainable models for pharmacies. They can be affordable and profitable for pharmacies. It's WORTH IT many times to carve out the pharmacy benefits too.-If you're a self-funded plan - shop. Shop around and find the best plan you can for your members, but also keep in mind supporting your local community through the plan. Does the PBM even have your local pharmacies in network?-If you're an employee lucky to have healthcare benefits through your employer - ask HR how they arrived at their current PBM, and what ways or alternatives you can use as a member of your plan to save money AND support local pharmacies. Ask your pharmacist who provides a fair dispensing fee and tell your HR team!-If you're an indie, indie chain, or even chain pharmacy - consider joining the Cost Plus Drugs Affiliate Pharmacy Network and the Team Cuban Card. Commit to transparency and break the current negative stranglehold! We have a fair dispensing fee built into our model as well. Sign up here to learn more: https://lnkd.in/gN6DuEeqMark Cuban Cost Plus Drug Company, PBC

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https://lnkd.in/ecpKYvtqIn light of the recent developments within the pharmacy sector, it's clear that major chains like Walgreens and CVS are facing significant challenges. After decades of expansion, these pharmacies are now scaling back by closing stores in an effort to bolster profits. This strategic pivot reflects deeper issues such as competitive pressures, changes in healthcare reimbursem*nt, and operational challenges that have led to a dramatic shift in their business models. The situation underscores the need for innovation and adaptation in the evolving healthcare landscape. #PharmacySector #HealthcareInnovation #BusinessStrategy #Walgreens #CVS

CVS Pharmacy and Walgreens run one of the largest illegal cartel in the world.They collude with HMOs and Employers Healthcare Plans on illegal kickbacks, rebates, cost share, and hidden schemes to distribute among themselves 40-70% of almost all prescription drug cost in U.S.(Look it up. I kid you Not!)Healthcare cost is near 1/5 of US economy at $5T a year. If it is a country, it is the 3rd largest GDP in the world and $1T ahead of Japan’s economy.All the Republicans get paid by lobbyists to be against ‘free market’ pricing negotiation by government. Even without that, the pharmacies have already manipulated the entire pricing structure with illegal schemes.

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Walgreens, CVS, and Other Pharmacy Chains Are in a World of Hurt. What’s to Blame. Chain retail pharmacies have pivoted from endless expansion to closing stores to boost profits.$CVS $WBAhttps://lnkd.in/ex9hR62T#tradeguard #receivableputoptions #arputs #receivableputs #tradereceivables #accountsreceivables

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Though I haven’t seen any evidence of this “cost plus” PBM model that allegedly CVS & WAG are pushing for…. This article states it would start in 2025. It also claims scarcity in the number of pharmacies would help their negotiations. Maybe that’s why the PBMs (namely CVS CRK) is trying to push so many independents out of business in 2024 with the double-DIR and looming trimester report.I’d ramp up cash compounding, especially weight loss and central fill, now. Once the storm is weathered, perhaps there will be a rainbow of PBM reform. If not, you still have a sustainable cash model.

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Again… not simply a problem for independent pharmacies even healthcare systems with public facing pharmacies have encounter these same issues. This is a particularly acute problem in rural areas where access is sparse at best and prescription volumes are low negative reimbursem*nt margins on even a few prescriptions can mean the death of an outpatient pharmacy even if it’s attached to a hospital. It’s time for the insurers that own the PBMs and dispensing mail order pharmacies stop the gamesmanship. How many years are we going to hear that industry say they drive down costs while their profits soar and pharmacies continue to close drying up more and more access points in rural and underserved communities.

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Over the past decade, PBMs have been cutting the reimbursem*nts pharmacies receive for the medicine they dispense to insured patients into smaller and smaller amounts. In many places, those reimbursem*nts don’t fully cover the acquisition cost of medicine.Pharmacies now routinely dispense medication that they lose money on. This is by design. A pharmacist sent us the 2024 contract for a major PBM and it shows that dispensing brand name medicines is compensated at a rate of “average wholesale price minus 25.5%.”This situation has created a demand for pharmacies to seek vendors who will sell them medicine at a discount, and an opportunity for criminals to enter the legitimate supply chain if they're clever enough to pose as real wholesalers. We asked pharmacists to share their receipts with PSM to show both what they paid for a medicine from their distributor and how the PBM reimbursed them. We found that PSMs are reimbursing pharmacies for less than the cost of medicines, which makes pharmacy buyers trying to keep their businesses afloat perfect targets for criminal counterfeiters trafficking diverted and counterfeit medicine.Learn more in our longer blog post at https://lnkd.in/gJXbp2M7.

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Over the past decade, PBMs have been cutting the reimbursem*nts pharmacies receive for the medicine they dispense to insured patients into smaller and smaller amounts. In many places, those reimbursem*nts don’t fully cover the acquisition cost of medicine. Pharmacies now routinely dispense medication that they lose money on.This is by design. A pharmacist sent us the 2024 contract for a major PBM and it shows that dispensing brand name medicines is compensated at a rate of “average wholesale price minus 25.5%.”This situation has created a demand for pharmacies to seek vendors who will sell them medicine at a discount, and an opportunity for criminals to enter the legitimate supply chain if they're clever enough to pose as real wholesalers. We asked pharmacists to share their receipts with PSM to show both what they paid for a medicine from their distributor and how the PBM reimbursed them.We found that PSMs are reimbursing pharmacies for less than the cost of medicines, which makes pharmacy buyers trying to keep their businesses afloat perfect targets for criminal counterfeiters trafficking diverted and counterfeit medicine.Learn more about this problem.

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"The chains had some great years. They squeezed out independent pharmacies, a third of which closed between 1990 and 2010. Today, their entire business model is under pressure. Turning the chains around won’t be easy. Their biggest problem has been the declining reimbursem*nt rates that pharmacy-benefit managers pay them for the prescription drugs they sell, says John Ransom, an analyst who covers Walgreens for Raymond James. Those cost pressures are unlikely to disappear."I encourage the National Association of Chain Drug Stores (NACDS) to join me in my call to have #pbms barred from owning or having any financial relationship with any pharmacy or dispenser of prescription drugs or devices. There is no clearer example of self dealing anti-trust activity & the #federalgovernment must step in to put a stop to it. PBMs must be stripped out of the pharmacy business & returned to their role as insurance processors if we have any hope of saving an industry! #pharmacists #independentpharmacy Todd S. Eury Antonio Ciaccia National Community Pharmacists Association (NCPA) American Pharmacists Association SaveNJRx Garden State Pharmacy Owners New Jersey Pharmacists Association Newsvine (A Division of MSNBC/NBCNews) WHYY CNN Reuters The Associated Press NEWYORKTIMES.COM https://lnkd.in/e83fTiSF

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