Rite Aid Chief Issues Call-To-Action

Aug 31, 2004

By George Anderson

Mary Sammons, president and chief executive officer, Rite Aid, told attendees at the 2004 National Association of Chain Drug Stores (NACDS) Pharmacy & Technology Conference in San Diego, CA, “this is a time of dramatic change for community pharmacy” and a period of many challenges.

At the top of Ms. Sammons’ list of challenges is “the extent to which cost pressures threaten to turn the delivery of medicines into a commodity business, diminishing the role and value of neighborhood pharmacists.”

The Rite Aid exec called on all elements of the industry to focus on changing this perspective through education and improved performance.

Ms. Sammons said neighborhood pharmacists could go a long way in improving their image and value to consumers through the use of electronic prescription technology to reduce errors in the dispensing process and free up time for customer consultations.

According to Ms. Sammons, 90 percent of prescriptions filled in the U.S. today are done so through paper prescriptions, over the phone or via fax.

She cited a study by an unnamed group, which estimated “the widespread use of e-prescribing could cut the nation’s health care bill by as much as $29 billion a year.”

Rite Aid’s chief also said investments in other technologies, such as robotics and radio frequency identification (RFID), would be invaluable in improving supply chain performance and freeing pharmacists up from time-consuming tasks to consult with customers.

Store design also plays a role in reemphasizing the role of the pharmacist, said Ms. Sammons. “Many companies, mine included, are developing new store designs that showcase the pharmacy, incorporating consultation rooms, remodeled pharmacy counters and other design enhancements that sends the clear message to customers that pharmacy is the heart of this business.”

“Interestingly, it is at the regional level that we now see some the most progressive and proactive initiatives to promote the value of pharmacy,” she said. “Kerr Drug in North Carolina, to cite one example, has established Health Care Centers in nearly ten percent of its stores — where clinical pharmacy teams offer a menu of health and wellness services that are paid for by the patient or through various contracted employer programs.”

Ms. Sammons said that, while these various professional services carry a price tag, she is confident cost savings realized through more efficient pharmacy operations utilizing technologies such as electronic prescriptions, robotics, RFID, etc. will balance out in consumers’ favor while providing pharmacies with the revenue they need to grow.

Pharmacies are in the best position to offer wellness and drug therapy management services “because patients visit their pharmacies five times more than any other health care setting.”

Moderator’s Comment: Do you agree with Mary Sammons’ view that the major challenge facing the industry is that the emphasis on low drug prices is turning
retail pharmacy into a commodity business? Will the actions proposed by Ms. Sammons reverse the move in that direction? Of the current pharmacy operations, which do you believe
do the best job working with consumers to gain the most benefit from their medication therapy?

Mary Sammon issued the following call-to-action to the attendees at the NACDS convention.

“We must invest in education to better train future pharmacists for the important work of direct patient care and better equip them with the skills and
resources they need. And we must work to create an environment in which the young pharmacists who want to make a difference in patient’s lives can find engaging, fulfilling work
in our stores.”  

“They know which chains really walk the talk, and those of us who make a real commitment to promoting pharmacy care are the ones who will attract the best and the brightest.”

“Research shows that the pharmacy is the primary driver of customer satisfaction and loyalty to a drug store. So it clearly follows that the investment we in the chain drug industry
make in the pharmacy itself is a direct investment in the health of our business.”

“So this is our challenge. And I’m asking each of you to join me in this mission. Take this message back home to your companies.  Be bold in your efforts to advocate on behalf
of pharmacy.  Argue for the resources we need to build the pharmacies of the future.”

“Because our future depends on the success of all of our efforts.”

– George Anderson – Moderator

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1 Comment on "Rite Aid Chief Issues Call-To-Action"

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James Tenser
17 years 8 months ago

Speaking for myself, value-added services are unlikely to persuade me to purchase prescription medicine from any particular place if the price is higher. I think price competitiveness is the ante in this game, while service quality may be the point of differentiation after that.

Give Ms. Sammons credit, however, for emphasizing the professional role of the pharmacist, and for her words favoring tools and processes that make them less like dispensing clerks. Despite this rhetoric, it’s the chain drug stores that altered the pharmacy business in the first place. Now that cheaper online sources have them running scared, the big players are talking like the independents did two decades ago. Ironic, eh?