Few other pharmacies fill as clear a niche as those operated by Costco Wholesale Corp. “I think the single thing that most sets us apart is low price,” senior vice president of pharmacy Victor Curtis says.


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Costco raises profile of its pharmacies

August 28th, 2012

ISSAQUAH, Wash. – Few other pharmacies fill as clear a niche as those operated by Costco Wholesale Corp. “I think the single thing that most sets us apart is low price,” senior vice president of pharmacy Victor Curtis says.

Victor Curtis

For example, the warehouse club chain’s 436 pharmacies offer the Costco Member Prescription Program, which provides one of the industry’s few money-saving alternatives for patients without prescription drug coverage. Costco members without prescription drug benefits or with poor insurance coverage who enroll in the program pay even less for some prescriptions than what Costco members with insurance pay for the same drug or a therapeutically equivalent alternative.

Executives say the program is just one of several efforts over the past few years to raise the profile of Costco pharmacies.

One area where the company has focused much of its effort has been in providing adult vaccinations.

More than 300 Costco pharmacists — representing about 60% of the retailer’s clubs — have been certified as immunizers in 25 states across the country and provide patients with a wide variety of vaccinations that include two types of hepatitis, HPV, pneumonia, shingles and tetanus.

The company’s pharmacies also offer flu shots that are administered by a third party that executives say can provide the immunizations in a more efficient manner.

Curtis says that, going forward, Costco expects to increase the number of different vaccines it makes available to its patients as it looks to broaden its offering of clinical services.

“We have been focusing more on medication therapy management, disease state management and adherence programs,” he says. “All of these are growing at Costco, and now we are looking at how to provide these services to payers and help reduce their overall spend on health care.”

Like so many other community pharmacy operators, Costco continues to look for ways to give its pharmacists more time to counsel patients and provide services beyond just prescription filling.

For instance, Curtis says, Costco has three central fill facilities that handle 46% of all of the prescriptions it dispenses annually. The centers, in the areas of the country that have the highest concentrations of high-volume pharmacies, are all located west of the Rocky Mountains, he notes.

The next step in the centralization process, Curtis says, will be central processing, a step that will further reduce the need for pharmacists to spend their time behind the counter.

“I think it is really important that we find ways to shift more of the pharmacists’ time towards patient care,” he says. “Greater use of central fill and central processing of prescriptions will help us to do that.”

Providing more than prescription filling is nothing new for Costco. The company was one of the first community pharmacy chains to offer free health screenings for diabetes, cardiovascular disease, osteoporosis and allergies, and it has continued to make these services a centerpiece of its pharmacy operation.

Last year the company added osteoporosis and healthy heart screenings to its list of clinical services when it held one-day screenings in 121 warehouse clubs in 36 states.

Curtis admits that while Costco cannot compete with community pharmacies in other trade classes on a convenience level, it is more than capable of competing on price. The company’s generics program, for instance, offers a 90-day supply of many drugs for $10 or less.

For Costco shoppers, the pharmacy has become a central feature in every warehouse club. All 436 Costco outlets in the United States have a pharmacy department, and the company generates an estimated $1.6 billion a year in prescription sales.

The popularity of the company’s pharmacies has helped it to attract more customers over the past few years. Costco reported earlier this year, for instance, that 2011 saw its members shop the company’s warehouse clubs 4% more often than they did in 2010, and spend about 5% more per trip.

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