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Wal-Mart's $4-drug plan goes statewide

The company also expands the list of medicines available in the program. Target matches the offer.

By Times Staff and Wire Reports
Published October 6, 2006

List of drugs

Bolstered by a wildly successful pilot program in the Tampa Bay area that reduced the cost of select generic prescription drugs to $4 for a 30-day supply, Wal-Mart on Thursday said it will expand the program to include all of its Florida pharmacies starting today.

Within hours of the announcement, Target fired back, saying it will match Wal-Mart’s new prices in all of its Florida pharmacies, also beginning today.

Wal-Mart unveiled the Tampa Bay program two weeks ago, and company executives said at the time they would look to expand the program statewide in January, and nationwide after that.

But Wal-Mart executives said Thursday that customer demand and requests from Florida officials prompted them to act sooner and to expand the number of drugs included in the scaled-down pricing plan.

Wal-Mart officials said that within 10 days of the Sept. 21 launch of the program in the Tampa Bay area, the retail giant filled 36,000 new prescriptions at its 65 west-central Florida Wal-Mart, Neighborhood Market and Sam’s Club stores. Company officials hope to expand the program beyond Florida to as many states as possible in the weeks ahead.

Other major drug retailers, including Walgreens and CVS, have so far declined to follow the nation’s top two discounters, saying convenience and location will continue to bring customers into their stores.

Gov. Jeb Bush, who had challenged Wal-Mart to roll out the program across the state, praised the company at a news conference Thursday.

“This is a disruptive idea that is going to bring benefits to millions across our state,’’ Bush said.

Wal-Mart also announced Thursday the list of discounted drugs has been expanded from 291 to 314 medications.
Consumers could save an average of 20 percent, and up to 90 percent, on some prescriptions under the Wal-Mart and Target programs. The drugs covered are used to treat conditions ranging from high-blood pressure to allergies.

Critics say the number of prescription drugs Wal-Mart discounts is misleading and only amounts to about 125 different drugs because the company counted the same drug in different dosages to come up with its total.

A trade association of independent pharmacies that compete with Wal-Mart said the program offers just a fraction of the roughly 8,700 generic drugs approved by the U.S. Food and Drug Administration.

“It’s a loss-leader type program that is solely aimed at getting people in the door at Wal-Mart. Most people going to get their prescriptions filled will be disappointed,” said Charlie Sewell, executive vice president of government affairs at the National Community Pharmacists Association, which says it represents about 24,000 non-chain pharmacies.

But discontent was not on the minds of some customers waiting Thursday to get their prescriptions filled.

“This is the best thing possible to happen to customers,’’ said Rene Leon, 70, who was getting his anticholesterol medication at a Wal-Mart on S Dale Mabry Highway in Tampa.

The sale of affordable prescription drugs also is sparking the desired side effect of driving other business within the discount stores.

While Marta Ramirez of St. Petersburg was waiting for her prescription at the Wal-Mart on U.S. 19 in Pinellas Park, she did some grocery shopping and got her hair done.

But what got her in the door was the prices.

“Everybody comes here,’’ she said, “to save a few dollars.’’

While the program is expected to be attractive to the uninsured, insurance will be accepted.

Those with insurance may even find themselves paying cash because Wal-Mart’s prices are lower than their co-payments.

The medications include drugs to treat such conditions as high blood pressure, diabetes, infections, allergies and sleep disorders.

The prescription drug program is the latest health initiative by Wal-Mart since late last year as the nation’s largest private employer seeks to deflect union-backed criticism of its worker benefits and influence the national debate on health care.

“If there’s one thing we’ve learned in the past two weeks, it’s that Wal-Mart can play a unique role in responding to the needs of our customers who have struggled for too long with the high costs of prescription medications,” said Bill Simon, executive vice president of Wal-Mart’s professional services division. “This introduces competition to an area where there has not been enough of it.”

Simon said the source of the company’s prescription drugs would not change. Some are domestically produced, and some are imported from abroad. He did not name specifically where the drugs come from.

“We don’t do anything different than anyone else does,” Simon said.

Wal-Mart shares fell $1.24, or 2.5 percent, to $48.31 in afternoon trading on the New York Stock Exchange.

Times staff writers Tom Zucco, Kris Hundley and James Thorner,  contributed to this report.

[Last modified October 6, 2006, 06:44:12]