Walgreens Drops Out of CVS Caremark Plans, Further Substantiating Claims of NCPA and Others about Impact of Merger

Tuesday, June 8, 2010 Corporate News
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ALEXANDRIA, Va., June 7 Today Walgreens announced its intention to no longer renew existing contracts or enter into new prescription drug benefit contracts with CVS Caremark. The grievances behind this unprecedented action include the unfair design of CVS Caremark's Maintenance Choice program, the lack of notification when one of their patients are transferred to a CVS Caremark retail or mail order pharmacy to fill their prescriptions, and CVS Caremark's unpredictable prescription drug reimbursement rates, Walgreens said. In response, Joe Harmison, PD, an Arlington, Texas pharmacy owner and National Community Pharmacists Association (NCPA) president, issued the following statement:

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"Walgreens' momentous decision is an indictment of all that has gone wrong for patients and the practice of pharmacy since the CVS Caremark merger in 2007. The company's pre-merger promises to be agnostic as to where patients filled their prescriptions have given way to strong-arm tactics to steer patients to CVS Caremark retail or mail order pharmacies. As Walgreens said, CVS Caremark programs like the misnamed 'Maintenance Choice' separate patients from their longtime local pharmacists, forcing some to a distant CVS or to mail order against their will.

"If a large, publicly traded chain with the clout of Walgreens finds the business practices of CVS Caremark untenable, then it's easy to understand how much greater the problems have been for independent community pharmacists and their patients. The concerns expressed by Walgreens echo and further validate the concerns expressed by independent community pharmacists and their patients.

"NCPA has urged a Federal Trade Commission investigation into CVS Caremark since 2008 and we continue to offer evidence of the problems related to the merger. Fortunately, the FTC is looking into allegations of anti-competitive and anti-privacy business practices. More than two dozen state and local governments are also scrutinizing CVS Caremark. Where there is smoke, there is fire. Walgreens' action today has turned that fire into a raging inferno.

"Unfortunately, for most independent pharmacies, simply telling CVS Caremark 'no' isn't a viable business option. The evidence is piling up and hopefully corrective action will be taken that either erects substantial walls between CVS and Caremark or rescinds the merger so that the market can operate equitably without one company abusing the system for its enrichment at the expense of patients and fair competition among pharmacies. Whether for business partners like Walgreens and independent community pharmacies, or patients and prescription drug plan sponsors, the costs of the CVS Caremark merger continue to grow."

The National Community Pharmacists Association (NCPA®) represents America's community pharmacists, including the owners of more than 22,700 independent community pharmacies, pharmacy franchises, and chains. Together they represent an $88 billion health-care marketplace, employ over 65,000 pharmacists, and dispense over 40% of all retail prescriptions. To learn more go to www.ncpanet.org or read NCPA's blog, The Dose, at http://ncpanet.wordpress.com.

SOURCE National Community Pharmacists Association

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