DENVER — The chain pharmacy industry is going through a period of dramatic transformation, according to Steve Anderson, president and chief executive officer of the National Association of Chain Drug Stores. During the business program at the NACDS Total Store Expo here last month, Anderson highlighted the emerging trade war stemming from President Trump’s tariffs as one of the major factors contributing to this turbulent time. The developing trade war, Anderson said, “has already involved tariffs on billions of dollars of goods, and has targeted hundreds of billions of dollars more.”
He called on the industry representatives in the audience as well as decision makers in Washington to do what they can to avert this trade war, which he said “could jeopardize much of what you are doing to transform your business and this great industry.”
Anderson added that the potential negative consequences from the tariffs and trade war are already on the minds of NACDS members and their customers. “Diverse products, packaging and equipment already are being affected. There are increased freight costs, too,” he said. “This matters to the entire supply chain. It affects the products on store shelves, it affects the process of getting those products to the shelves, and it even affects the shelves themselves, given rising steel costs.”
To substantiate his view on the tariffs and pending trade war, Anderson released the results of a survey of Denver residents, commissioned by NACDS and conducted by Morning Consult, in which 65% of those surveyed responded that they are concerned about retaliatory tariffs imposed on the U.S. by other countries. Additionally, 76% fear increased prices — especially on health care products, while 62% said they are concerned about job losses across industries. Specific to Colorado, 49% believe the tariffs will hurt the state’s retail industry. Of those taking part in the survey, 62% said they preferred more free-trade agreements, with only 18% in voicing support of tariffs as a matter of trade policy.
“From here at the NACDS Total Store Expo, we are telling this story to Washington decision makers through a concerted communications campaign this week,” Anderson said, adding that Morning Consult is blasting the organization’s information through its publications and sending NACDS data to the power brokers in the nation’s capital. “We are sharing this with the Denver and Washington, D.C., media,” he added.
To emphasize NACDS’ ability to get things done, Anderson pointed out that retailers and suppliers worked together last year to successfully fight the border adjustment tax. “That proposal, which threatened consumers, workers and businesses, was defeated,” Anderson noted. “It is time to take up the fight on the trade war again. We are sending that message loud and clear. And there could not be a better venue for making the case than right here.”
Mark Panzer, chairman of the NACDS board and senior vice president of pharmacy, health and wellness at Albertsons Cos., also spoke during the business program and touched on some of the values that matter most to NACDS members. “In short, it’s about business community and intelligence, it’s about effective government advocacy, and it’s about powerful and practical information on policy,” Panzer said.
Speaking to business community and intelligence, Panzer based his remarks on his personal experience of benefiting from various work relationships and from collaboration with business partners. He told the audience that companies can enhance those benefits by achieving “the vision that the NACDS Total Store Expo can foster conversations for the entire store — pharmacy and the front-end, health and wellness, technology, distribution and logistics.”
Government advocacy is also an important component of the NACDS mission, and Panzer drew on his own experience there as well.
“I learned something in the early days of my career that reinforces the importance of advocacy,” he said. “What I learned, and what is reinforced for me every day, is just how important pharmacy is to people or patients, and to the communities they serve.”
Anderson also touched on the role NACDS plays in advocacy, noting the NACDS RxImpact Day grassroots advocacy program. “In March of this year, advocates from all 50 states visited in person every single congressional office on Capitol Hill, all 100 members of the U.S. Senate, and all 435 members of the U.S. House of Representatives,” he said. “That is unheard of among other grassroots programs.”
Anderson also pointed out that NACDS members are hosting congressional pharmacy tours and other events in states and congressional districts. More than 650 of these events have been hosted over the past decade, according to Anderson. “These events are powerful. This is where members of Congress come into our members’ stores and see the work you are doing for their constituents as the face of neighborhood health care. And it’s producing positive results on Capitol Hill.”
Panzer provided an update on the progress of NACDS’ Access Agenda, which involves playing aggressive offense and tough defense on pressing issues, while serving as a working partner for stronger and safer communities.
As examples, Panzer described the association’s successful work throughout 2018 in expanding pharmacists’ immunization authority, fostering medication synchronization and enhancing the ability of pharmacists to furnish medications. Panzer also updated the attendees on the status of NACDS’ work with the National Community Pharmacists Association, the National Grocers Association and other allies to advance direct and indirect remuneration (DIR) fee reform.
Addressing the epidemic of opioid abuse, Panzer talked about prevention and described progress on NACDS’ policy recommendations, such as requiring electronic prescribing to help stop fraud and abuse. “It was not that long ago that NACDS was on the leading edge of urging and collaborating with the Drug Enforcement Administration to allow e-prescribing of controlled substances,” he said. “Now, it’s not just about allowing it, which took effect in 2010. Now, we’re working to mandate it. We have moved from a question of ‘may’ to a question of ‘mandatory.’ ”
And as Panzer pointed out, the momentum is behind the push to mandate e-prescribing. This year alone, five states — Florida, Iowa, Kentucky, Missouri, New York and West Virginia — have enacted mandatory e-prescribing legislation, bringing to 11 the total number of states with an NACDS-backed mandate, with legislation pending in four additional states. Progress is also being made at the federal level with the Every Prescription Conveyed Securely Act, which has been passed in the House and in a Senate committee.
There have been successes this year in empowering pharmacists to do more, such as medication synchronization legislation being enacted in Mississippi, New Hampshire and Virginia.
“Several states acted to expand the ability of pharmacists to furnish medications: Colorado, Maryland, New Hampshire, Tennessee, Idaho, Iowa, plus the District of Columbia,” Panzer noted.
Panzer also talked about the work of the NACDS Retail Advisory Board, which includes mainly front-end representatives who advise the NACDS board on emerging issues.
“They have done fantastic work on digital marketing, e-commerce, multicultural marketing, understanding what makes customers happy, helping us understand specific markets across the country, blockchain, artificial intelligence, and on dissecting the ways that companies of different sizes can and do work together,” Panzer said.
Emphasizing the importance of Total Store Expo, Panzer said the event fosters conversations across the entire spectrum of the store — from pharmacy and the front end to health and wellness, and from technology to distribution and logistics.
On DIR fee reform, Panzer said the current model, in which a pharmacy can be reimbursed for a prescription only to find out later that a portion of that reimbursement is being clawed back by a payer, is simply not sustainable. Reforming DIR fees, according to Panzer, is a top priority for the industry and NACDS.
Pharmacy, in Panzer’s view, “is worth fighting for.”