The announcement last month that Walgreens had agreed to acquire Kerr Drug, the 76-store, Raleigh, N.C.-based drug chain, disrupted chain drug retailing as few previous acquisitions had done.

Kerr Drug, Walgreens, Tony Civello, David Pinto, chain drug industry, consolidation, drug chain, chain drug retailing, Thrift Drug, Eckerd, Banks Kerr, regional drug chains, Chain Drug Consortium

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Inside This Issue - Opinion

Industry won’t be same without Civello

October 14th, 2013
by David Pinto

The announcement last month that Walgreens had agreed to acquire Kerr Drug, the 76-store, Raleigh, N.C.-based drug chain, disrupted chain drug retailing as few previous acquisitions had done.

It wasn’t the size of the deal that caused such a stir. Numerically, this was but a small example of the consolidation the chain drug industry has been experiencing for the past 25 years.

Nor was the deal strategically startling. Kerr is, strictly speaking, a local drug chain of the kind that once defined chain drug retailing in America. It operates in only one state, and its disappearance will go largely unnoticed. Similarly, the benefit to Walgreens, a drug chain of over 8,000 stores, will be a marginal one, increasing the Deerfield, Ill.-based retailer’s advantage in a state that already claims a significant Walgreens presence.

No. The tremors surrounding Kerr’s imminent disappearance have more to do with individual personalities than with the drug chain itself. More specifically, Kerr’s departure from the chain drug landscape will signal as well the departure of Tony Civello, Kerr’s chief executive, one of the truly significant executives chain drug retailing has produced in the last half-century.

Civello has been a chain drug presence for too many years to reckon up. Prior to gaining control of Kerr in 1996, he was a senior executive at Thrift Drug in Pittsburgh. He had joined Thrift out of pharmacy school and worked his way to the very top of that drug chain by doing what he has always done: working hard. By the time Thrift disappeared in 1996, a victim of the acquisitive Eckerd drug chain, Civello had become one of the industry’s most respected figures, an executive with an outsized personality and a clear vision of what chain drug retailing could and should be — and increasingly wasn’t.

Civello worked at Eckerd for a short time, but the fit wasn’t right — and he left to form a group to buy Kerr Drug, one of the chain drug industry’s venerable regional retailers. In the years since, Kerr gained a prominence and respect out of proportion to its size or importance, because Civello and the staff he assembled brought innovation and creativity to a drug chain previously known primarily for the personality of its founder, Banks Kerr.

Along the way, Kerr’s leader became a spokesman for chain drug retailing, ascending to the leadership of the industry’s association and forging an alliance of regional drug chains to buy more efficiently and economically and so compete more effectively with their larger rivals. Today, Chain Drug Consortium, the group Civello formed, is a significant buying organization within the chain drug industry.

No one yet knows what Civello intends to do after the acquisition is completed. Perhaps Civello doesn’t even know. It’s difficult to believe that Walgreens won’t try to retain him in some capacity. Other options will emerge. He intends to remain in North Carolina, where he has retained some business interests formerly associated with Kerr.

But it won’t be the same, either for Civello or for the industry that is losing him. For he has never been a person to force himself, his ideas or his opinions on those who don’t welcome them. And without the megaphone that Kerr Drug has been, the very real possibility exists that he will emerge from the acquisition as just another former chain drug executive, remembered as a personality but largely forgotten as a contributor to the industry’s growth, maturation and emergence as a major retailing enterprise.

Yet the feeling here is that that won’t happen. For Tony Civello has meant too much to too many for too long to simply be allowed to disappear.

As so many before him have insisted, he does not intend to appear at the NACDS Annual Meeting next spring, despite the requests of the association’s senior managers. But the pull of the industry and the strength of his relationships may be too strong to keep him home.

And if the NACDS tug isn’t strong enough, another temptation will surely come along. For the truth is, Tony Civello and chain drug retailing in America are one and the same. He represents this industry as effectively as any individual ever has. He embodies its character, its fairness, its ethics, its emphasis on helping its customers and its employees, the reputation its pharmacists have justly acquired as the patient’s first line of communications and response where health care is the issue.

For those and countless other reasons, Tony Civello is too important to be dismissed as yesterday’s headline or last year’s hero.