Veterinary Economics - June 2012 - (Page 56)
The real future of pharmacy
New competition and proposed prescription legislation are tough pills to swallow.
tions for free. Pretty hard to comn many companion animal pete with free. In his book Free: practices, dispensing prescripThe Future of a Radical Price (Hytion drugs, nutraceuticals, and perion, 2009), author Chris Anparasite prevention and control derson points out that after trying products makes up 17 percent to a free product, many people will 20 percent of practice revenue. adopt that product for good. Once Historically, selling these prodbuying habits change, it’s unlikely ucts has been a relatively passive that they’ll switch back. revenue source. You decide which Of course veterinary practices drugs you want to inventory, apdon’t just sell and dispense prodply a markup (typically 100 peructs. We provide knowledge and cent), and add a dispensing fee of advice and perform services and $5 to $15. Then you dispense the procedures. But the Internet jeopproduct as indicated and restock. Dr. Michael Paul ardizes that foothold too. In the In the past, we’ve seen little past 10 years, the number of shopcompetition for our clients’ hearts and pocketbooks. Consumers didn’t shop competitively pers using the Web for information has doubled. Today, for most products, and the profession enjoyed a pre- 30 percent of your clients go to the Internet before they see you. Another 20 percent will go to the Internet after scribing and dispensing monopoly. But that’s changing. they see you to validate or clarify what you told them. The castle of parasite and heartworm preventives is when price trumps advice Over the years, traditional pharmacies have put just a the first under siege by Web-browsing clients and chainsmall dent in our business. Then came Internet pharma- store pharmacies. This is no surprise considering that cies, which advertised directly to the pet owner and sold it represents the repeat purchase of a fairly expensive products at a slightly lower price. They also provided ex- product. If veterinarians lose that market, we will feel it. tra convenience by delivering right to the owner’s door. As a profession, we bristled and barked but really more competition from congress couldn’t do much, other than compete on price. And the Dispensing and prescribing is already a dwindling part truth is, most pet owners rarely fill prescriptions over the of our practices. When clients ask for written prescripInternet. When they need a drug, they need it now, not tions, most states now require us to provide them— in 48 to 72 hours. Most drugs dispensed via the Internet and, no, you cannot charge to write the prescription. are for long-term, repeated administration: parasite con- If passed, new congressional legislation will mandate trol products, NSAIDs, endocrine drugs, and so on. that veterinarians provide a written prescription even if Most veterinary drugs or human generics are still dis- we fill the prescription in house. The AVMA has come pensed directly from the veterinary practice. But several out against this “Fairness to Pet Owners Act of 2011” retail outlet pharmacies are hoping to take that business (H.R. 1406), which Utah Rep. Jim Matheson introduced away by actively seeking pet owner prescriptions. Pet to save consumers money by giving them the option to owners can take their prescriptions to the SuperStore or purchase pet prescriptions elsewhere. The result of such the SuperMart and have them filled, in some cases, for legislation: Pet owners who didn’t know they could go to minimal cost. Some chains are even filling pet prescrip- their neighborhood pharmacy for prescriptions will now know—and will go.
Get in on the act
Read the entire text of H.R. 1406, the Fairness to Pet Owners Act of 2011, and follow its progress through the U.S. House and Senate by visiting opencongress.org.
Dr. Michael Paul is the former executive director of the Companion Animal Parasite Council and a former president of the American Animal Hospital Association. He is currently the principal of Magpie Veterinary Consulting. Please send questions or comments to email@example.com.
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Table of Contents for the Digital Edition of Veterinary Economics - June 2012
Veterinary Economics - June 2012
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Boost Your EQ
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Extinguish negative reviews
When disaster strikes … where will you be?
Checklist: Help clients help their pets
Lessons from the front lines: When disaster hits home
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Veterinary Economics - June 2012