Retailer Expands $4 Drug Program
Wal-Mart Stores Inc. will expand a program offering some generic drugs for $4 a prescription throughout Florida today, and may bring the discounts to other U.S. states before the end of the year, the retailer said Thursday.
A small number of generic drugs will be available at the $4 rate, below the standard pricing of drug plans offered by private insurers in the United States, the most expensive healthcare market in the world. Brand-name drugs, which tend to be more expensive, are not covered by Wal-Mart’s program.
Main rival Target Corp. said it would match Wal-Mart’s move in Florida.
As was the case when the world’s largest retailer first launched the cheap medicines plan Sept. 21 in the Florida retirement haven of Tampa, shares of drugstores were hammered by investors.
Shares of Walgreen Co., the No. 1 U.S. drugstore chain, fell $1.49 to $43.39 on Thursday, and CVS Corp. dropped $1.22 to $30.93.
Wal-Mart’s stock fell $1.14 to $48.41.
Wal-Mart’s Florida statewide rollout was originally planned for January, and plans to take the generic-drug program nationwide had been scheduled for later next year as part of an offensive to improve Wal-Mart’s image as a corporate citizen.
Critics called it a publicity stunt that wouldn’t resolve poor healthcare conditions for the chain’s low-paid workers. They said it applied to a limited range of older generic drugs, some of which are already sold over the counter or at low prices anyway.
“Prescription medicines are not a commodity like T-shirts and DVDs,” said Bruce Roberts, head of the National Community Pharmacists Assn. “We are concerned that patients will be both misled and disappointed by the limited number of medicines in this new program.”
Wal-Mart announced the faster expansion of the program at a news conference in Orlando, Fla., attended by Republican Gov. Jeb Bush.
“This is a disruptive idea that is going to bring benefits to millions in our state,” Bush said. “It is disruptive in the marketplace. The other pharmaceuticals ought to be thinking about doing the same thing.”
Bill Simon, executive vice president of Wal-Mart’s professional services division, said he had challenged his team to figure out how to expand the generic-drug program to other states before year-end and cited Thanksgiving, which falls on Nov. 23, as a possible target date.
The Bentonville, Ark.-based retailer also said it would expand the range of drugs available for $4 per monthly supply to 314 medications from 291. Critics say the 314 number refers in some cases to different dosages of the same medication. Wal-Mart said the list represented as many as 143 different compounds.
