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Eckerd will offer 30 percent discounts to holders of Together Rx. The discount is twice as big as the card's sponsors expected.
By MARK ALBRIGHT, Times Staff Writer
© St. Petersburg Times, published November 15, 2002
LARGO -- Eckerd Corp. has agreed to offer 30 percent discounts on most generic drugs to holders of Together Rx, a prescription drug discount card for seniors of limited means that's sponsored by nine of the nation's biggest brand-name pharmaceutical companies.
The discount is twice as big as the card's sponsors expected. They hope other chains will follow the lead of Eckerd, the nation's fourth biggest drugstore operator.
"We think it's the right thing to do," said Joan Gallagher, spokeswoman for the Largo chain, which will offer the lowered prices starting Sunday on more than 1,000 generic equivalent drugs. "This is a big underserved population that might not take a medicine if they cannot afford to fill their prescription."
The Together Rx card is a pharmaceutical company attempt to head off a discount card pushed by the Bush administration, not to mention the prospect of federal restrictions on drug prices.
About 380,000 seniors nationally already carry the Together Rx card. It's free and available to anyone 55 or older who lives on less than $28,000 for a single person, or $38,000 for a couple. Cardholders cannot have any other prescription drug health plan. The 8-million to 11-million people eligible can sign up at most pharmacy counters.
Generic drugs produce higher profit margins than brand names for drugstores, and Eckerd was willing to shave those margins in hopes of drawing more traffic.
To the drugstore and pharmaceutical industries, the discount cards are a stop-gap measure while they lobby Congress to enact Medicare prescription drug benefits but on terms they prefer.
Improving Together Rx benefits to generics should enhance the card's value.
"This is going to help expand our benefits to more people," said Peggy Heller, spokeswoman for Together Rx.
Until now the Together Rx card has been good for discounts of up to 40 percent on 150 branded prescription drugs. But many of the discounts are not good for the latest brand. Discounts, for instance, are available for Prosilec, a medication for acid reflux disease of the stomach, but not Nexium, the newer and heavily marketed brand AstraZeneca created to replace it.
"With the average branded prescription priced at $72 and the average generic at $17, the addition of generics to the discount card is very significant," said Kathleen Jaeger, president and chief executive of the Generic Pharmaceutical Association, a trade group in Alexandria, Va.
About 47 percent of all prescriptions dispensed in 2001 were generic equivalents. But the soaring costs of marketing and developing new brands has been shrinking the percentage of prescription dollars spent on generics. Generics got 7.5 percent of all U.S. spending on prescription drugs in 2000, down from 12 percent in 1995.
The generics trade group estimates that consumers or health plans save $1-billion for every 1 percent increase in spending on generics.
-- Mark Albright can be reached at albright@sptimes.com or (727) 893-8252.