NACDS, NCPA urge state attorneys general to act; Emphasize continued litigation against merger and need for legislation to address PBM issues
Alexandria, Va. - April 2, 2012
National Association of Chain Drug Stores (NACDS) President and CEO Steven C. Anderson, IOM, CAE and National Community Pharmacists Association (NCPA) CEO B. Douglas Hoey, RPh, MBA issued the following statement today regarding the announced conclusion of the Federal Trade Commission (FTC) investigation into the merger of pharmacy benefit managers (PBMs) Express Scripts, Inc. and Medco Health Solutions, Inc.:
"NACDS and NCPA have aggressively fought this merger from day one because of its potential harm to patients and to competition. We are disappointed that the FTC did not act to protect consumers in this instance. It is worth noting that the merger proved controversial within the FTC. We commend Commissioner Julie Brill for her dissenting statement. In the end, two of four commissioners saw the need for remedies, and one of those commissioners wanted to challenge the merger in court.
"NACDS and NCPA will continue to push through the Washington gridlock by advancing the litigation we have filed with nine community pharmacy companies, and we urge state attorneys general to take action to block the merger as well. In fact, NACDS, NCPA and the other plaintiffs will file a motion with the court today, requesting that the judge direct Express Scripts and Medco to keep separate their assets pending review of the lawsuit and/or schedule an expedited review of the merits of our case.
"This merger has produced a torrent of opposition and concern from community pharmacies and from many others for the simple reason that it is not in the best interests of patients or consumers. Leading consumer advocacy organizations oppose it. We thank the 77 members of Congress who have written to the FTC to express their concern. More than 30 state attorneys general offices have been scrutinizing the deal. Small businesses have urged the deal to be blocked. We greatly appreciate the efforts of patients and pharmacists, including many NACDS and NCPA members, who raised their voices in protest.
"We continue to believe that the compelling arguments and evidence brought to the FTC by NACDS, NCPA, consumer groups and others warrant blocking this merger. That the agency is allowing the merger to proceed, and without any conditions, leaves patients and pharmacies vulnerable to significant harm from a combined ESI-Medco. Furthermore, we are disappointed that the agency based some of its views of the PBM-pharmacy marketplace on old, inaccurate data, despite NACDS and NCPA providing evidence to the contrary.
"NACDS and NCPA remain deeply concerned that this merger will reduce competition to unhealthy levels in several prescription drug markets that are already highly concentrated. These include the general PBM industry as well as the large health plan, specialty drug and mail order markets. As a result, we believe this merger will lead to higher prescription drug costs, fewer choices and diminished competition in both the community pharmacy and PBM sectors.
"While the claims of savings touted by merger supporters are exaggerated and highly dubious, there is no evidence to believe that any supposed savings will be realized by patients, plan sponsors and health plans.
"In addition, while we proceed with the litigation and encourage state attorneys general to act to block the merger, today's development dramatically strengthens the case for pro-patient, pro-pharmacist proposals in Congress and state legislatures. These include S. 1058 / H.R. 1971, the Pharmacy Competition and Consumer Choice Act, H.R. 1946, the Preserving Our Hometown Pharmacies Act, and H.R. 4215, the Medicare Pharmacy Transparency and Fair Auditing Act. These bipartisan bills would help to restore patient choice, level the pharmacy playing field, improve health outcomes and reduce overall costs, in contrast to the market changes and insufficient regulatory policies exemplified by this case.
"NACDS and NCPA also will continue to closely monitor the combined entity. We will not hesitate to bring any anticompetitive conduct to the attention of the appropriate government authorities and the courts to ensure that patients, plan sponsors and pharmacies interests are protected."
The National Association of Chain Drug Stores (NACDS) represents traditional drug stores, supermarkets, and mass merchants with pharmacies—from regional chains with four stores to national companies. Chains operate 39,000 pharmacies, and employ more than 2.7 million employees, including 118,000 full-time pharmacists. They fill nearly 2.6 billion prescriptions annually, which is more than 72 percent of annual prescriptions in the United States. The total economic impact of all retail stores with pharmacies transcends their $830 billion in annual sales. Every $1 spent in these stores creates a ripple effect of $1.96 in other industries, for a total economic impact of $1.57 trillion, equal to 11 percent of GDP. NACDS represents 137 chains that operate these pharmacies in neighborhoods across America, and NACDS members also include more than 900 pharmacy and consumer packaged goods suppliers and service providers, and over 60 international members from 23 countries. For more information about NACDS, visit www.NACDS.org.
The National Community Pharmacists Association (NCPA®) represents the interests of America's community pharmacists, including the owners of more than 23,000 independent community pharmacies. Together they represent a $93 billion health care marketplace, dispense nearly 40% of all retail prescriptions, and employ more than 315,000 people, including 62,400 pharmacists. Independent community pharmacists are readily accessible medication experts who can help lower health care spending. They are committed to maximizing the appropriate use of lower-cost generic drugs and reducing the estimated $290 billion that is wasted annually by improper medication use. To learn more go to www.ncpanet.org or read NCPA's blog, The Dose, at http://ncpanet.wordpress.com.
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