Careers in Retail Pharmacy

Retail clinics offer industry new growth opportunity

BY MICHAEL JOHNSEN

 

With the proliferation of retail clinics across the country, the concept certainly has struck a chord with pharmacy operators, potentially making in-store clinics a core destination in America’s pharmacies of tomorrow. It’s the drive-through of the new millennium: convenience-oriented and efficiency both woven into a health care visit—a health care visit, incidentally, that helps drive some 90 percent of prescriptions generated directly to the host pharmacy.

According to various estimates, the end of the decade could see as many as 10,000 retail clinics operating in community pharmacies across America, including chain and independent drug stores, as well as supermarket, mass and club/warehouse pharmacies.

Just in the past few months, a host of retailers have announced a series of relationships with retail clinic operators. The biggest news of course was the CVS acquisition of MinuteClinic—the first successful retail clinic operator to expand its format several years ago and by far the largest of them today.

And of course, while MinuteClinic patients are free to fill their scripts wherever they like, it isn’t likely they’d go somewhere else. As many as 90 percent of all MinuteClinic patients who receive a prescription fill it in the host pharmacy; 70 percent of those are new customers to that pharmacy who came for the care and not to shop the store, though they will leave having made a purchase. In addition, 38 percent buy an OTC product as a result of the clinic visit and 80 percent make a general merchandise purchase.

At the time of the acquisition, MinuteClinic operations had

reached a total of 83 clinics, including 65 in CVS/pharmacy stores, a total of eight among Bartell, QFC and Cub, as well as six freestanding clinics in the Twin Cities metro area—one located in a shopping center in close

plans: 800 to 1,100 clinics by 2009. While licensure regulations vary from state to state, CVS chief financial officer David Rickard recently noted during a conference call with securities analysts that “there are no ‘show-stoppers,’” in

 

The dollar figure may seem small, but the implications of CVS’ $170 million acquisition of MinuteClinic are far-reaching.

proximity to a Target, though the two are not officially affiliated—a campus location at the University of Minnesota and corporate-based clinics at suchcompanies as Best Buy and Guidant.

Under the CVS Corp. umbrella, MinuteClinic chief executive Michael Howe expects a vast ex-pasion of its previous growth

any of the 37 states in which CVS currently operates. Regulatory hurdles aside—apparently none of them insurmountable, anyway— CVS gives MinuteClinic the size, scale and scope to go national.

Both Walgreens and Wal-Mart, on the other hand, have been partnering with multiple clinic operators on a regional basis. Wal-

8

Fall 2006