Why Is Retail Pharmacy So Bad?

I am not completely objective since I have switched professions, going from working in pharmaceuticals to the computer industry. On the other hand, there are a few rational arguments that I have about working in retail pharmacy. Permit me to preface what I am going to say by stating that it is influenced by the way that retail pharmacy is conducted in Egypt, despite the fact that I found numerous parallels between the way that retail pharmacy is practiced in the United States of America and in Canada as well.

Learning Pharmacy requires a significant time investment and effort. The study of pharmacy involves a significant amount of theory presented in the form of lectures, in addition to a significant amount of laboratory hands-on practice. If you are not truly passionate about what you are learning, it requires a lot of pointless memorizing on your part.

There are a lot of tests, with one occurring virtually every month. There are “major” tests in the middle of the year and at the conclusion of the year. The tests at the conclusion of the year consist of written, lab, and oral portions. The study of pharmacy encompasses a wide range of specializations.

1. When you study pharmacy, you’ll learn a number of different medical sciences, as well as three different kinds of chemistry (analytical, organic, and pharmaceutical), as well as biology, physiology, botany, microbiology, pharmaceutics, pharmacology, pharmacognosy, and pathology, among other things.
2. The retail pharmaceutical industry is rather routine.

The task is monotonous on a day-to-day basis. Deciphering the illegible handwriting of doctors on prescriptions and presenting the information to customers are the two main components of this job. Both bulk packaging and individually dispensed packets are unavailable in Egypt.

• The medication is sold in its original packaging and is administered in its unaltered form.
• There will be no counting of the tablets, no labeling, etc.
• Therefore, it is a great deal less complicated than it is in North America.
• You are also responsible for a significant amount of work that falls under the administrative category.

Some examples of this type of work include stocking the shelves, placing orders for medicines that have run out, and managing the ancillary products that you sell. Some examples of these products include baby diapers, female makeup, sanitary pads, children’s toys, etc.

• Retail Pharmacy needs low mental challenge You, as the pharmacist, are responsible for dispensing the medication if the attending physician has prescribed it.
• There are, of course, some notable exceptions to this rule, such as interactions between medications; nevertheless, instances like this are extremely uncommon.

In point of fact, being a pharmacist and a pharmaceutical assistant are not all that different from one another; the primary distinctions lie in the levels of accreditation and responsibility/liability. There are typically extensive hours involved with retail pharmacy.

Long shifts are required of employees at all retail pharmacy locations, as well as opening on weekends and sometimes even on official holidays. This is especially important to keep in mind if you own your own drugstore. This is not so much a medical occupation as it is a retail store that must adjust its business hours and requirements to accommodate those of the public.

If you decide to operate your pharmacy within restricted hours, there is a good chance that another local pharmacy will gladly steal your clients and money. The regulations placed on retail pharmacies are absurd. The prices of medications are often set by a government agency, and the prices are typically written on the packaging of the drugs.

Because of this, the amount of profit is also fixed. In addition, a pharmacist is subject to a variety of inspections, some of which are the same as those that apply to any other form of retail business (taxes, accuracy of the balance and scale, etc.), while others are carried out by the relevant health authorities.

One positive aspect of this occupation is that, on average, it offers very good income. Even though they are considered to be behind physicians in terms of social status, pharmacists do have some “social prestige.” There are certainly other fields of work available to a pharmacist who has recently completed their education, but these other options are not much superior.

Pharmacist who does promotional work Being a salesperson for pharmaceutical businesses and advertising their wares to medical professionals in settings such as clinics, hospitals, and doctors’ offices is essentially what this entails. Being a good seller is the primary responsibility of the marketing position that you are applying for.

You need to be able to talk nicely to people, put in a lot of effort into building relationships, hand out free promotional items and samples of the drugs you are trying to sell, write sales reports on everything you do, and compile data on local physicians and pharmacies regarding how well your product is selling.

1. All of this is in addition to the fact that you have to give away promotional items and samples of the drugs! There is hardly any creative thought put into this, much alone anything that has anything to do with medicine.
2. In addition to pharmacists, this line of employment is pursued by a large number of other medical professionals such as veterinarians, doctors, and even dentists.

Quality Assurance in Pharmaceutical Production Facilities In Egypt, there are hardly no employment available in the field of pharmaceutical research. The majority of the pharmaceuticals that are produced there are either generic versions of existing medications, drugs that have been obtained from pharmacoepias, or drugs that are produced under license from other multinational pharmaceutical corporations.

• However, there is a demand for pharmacists who specialize in quality control within these firms.
• They are responsible for testing batches to ensure that the appropriate amount of active chemicals have been included, in addition to determining the appropriate disintegration time for tablets, etc.
• Standing throughout the entirety of the workday is a requirement of this employment, which adds to the difficulty of the work.

One of my acquaintances is a pharmacist who, as a result of his line of work, has developed varicose veins in both of his legs. In addition to that, the work demands you to adhere to the manuals of the procedures and to file the findings and reports. There is no opportunity for original thought or expression here either.

1. College or university pharmacy Only Egypt’s universities are allowed to do research in the academic field of pharmacy.
2. You will not be able to participate in research at a university if you do not have a position in the academic community there.
3. It is not surprising that people in Egypt make fun of pharmacists by referring to them as “Clean Grocers” or “French Grocers.” It has been my experience that people who work in the field of pharmacy tend to have poor self-esteem and a sense of being beneath other medical professionals.

In New York City, I saw a pharmacist who had the same perspective as one I had seen in Egypt, namely that the doctor enjoys a higher level of status. When I was in school for pharmacy in the late 1970s and early 1980s, there was a brand new and exciting career that was being advertised called “clinical pharmacist.” This was done with the intention of maximizing the usefulness of the information and training that pharmacists possess by establishing them as the go-to authorities on all matters concerning pharmaceuticals.

They would be a member of a team of healthcare professionals, such as physicians and nurses, who would work in hospitals: the physician would be the one to make the diagnosis, but the pharmacist would be the one to prescribe the most effective medication and dosage, taking into account drug-drug interactions, patient history, allergies, etc.

To this point, I have neither seen nor heard any evidence that this was put into effect anyplace. Like I did, I recommend that other people who are interested in doing something creative and difficult steer out of the pharmaceutical field until it becomes available.

Are smaller pharmacies better?

3. Smaller pharmacies are more likely to be able to personalize medication, whereas larger pharmacies typically have mass-produced medications with an emphasis on convenience. These medications may be effective for most people, but certain patients require individualized care.

• For example, a pharmaceutical corporation may decide that it is no longer profitable to produce a certain drug.
• In certain other instances, the generic medicine that is currently on the market may have components that result in adverse consequences.
• When large pharmacies are unable to assist, local pharmacies may be able to.

Compounding allows these pharmacies to manufacture pharmaceuticals that have been taken off the market specifically for their consumers. Patients have access to prescriptions in a variety of formats, some of which are free of potentially dangerous chemicals.

What does a day in the life of a pharmacist look like?

A Day in the Life of a Pharmacist Pharmacists are responsible for filling prescriptions for pharmaceuticals and medicines that have been given to them by doctors and other medical professionals. As a result of this, a pharmacist is required to have the level of medical expertise necessary to educate patients about the objectives, potential risks, and potential benefits of any medication that they give to their patients.

In addition, pharmacists maintain computerized and frequently in-depth records of their patients’ drug use and medical profiles. The purpose of these records is to ensure that patients do not combine medications that should not be taken together and that they adhere to the dosage instructions given to them by their physicians.

Being actively involved with patients, offering information on prescription pharmaceuticals, connecting patients to suitable over-the-counter drugs, and counseling physicians on the right selection and administration of medications is becoming an increasingly important component of the role of the pharmacist.

Pharmacists who work in community pharmacies, of which there are nearly 60 percent, may also be responsible for other aspects of running the business. These responsibilities may include purchasing and selling nonpharmaceutical merchandise (think of all the other things you can buy at Rite Aid), hiring and supervising personnel and pharmacy technicians, and managing a significant portion of the day-to-day operations of the pharmacy itself.

Even paid workers of large chains of pharmacies sometimes find themselves taking on certain administrative obligations in addition to their usual pharmaceutical duties. This is more common for pharmacists who run their own businesses since they are required to handle all of these jobs.

1. Pharmacists who are hired by hospitals (this group makes approximately 25 percent of the profession), clinics, and HMOs function as consultants to the medical team in addition to dispensing prescriptions.
2. In addition to this, they are responsible for the procurement of medical supplies, the instruction of interns, and the performance of administrative tasks.

Sterile solutions are made by them for use in the operating room and emergency rooms. Some of them in the hospital and medical field continue their education and conduct research into new medicines and areas of drug therapy, specializing in drug therapies for psychiatric disorders, for example, or the use of radiopharmaceuticals.

How much money does a pharmacy make on a prescription?

It is time to bring the unique look into the business economics of independent pharmacy operators that Drug Channels has been providing up to date. In spite of what you may have heard, a significant number of independently owned pharmacies are still thriving in today’s extremely competitive retail climate, according to the findings of our study.

1. While there was no change in the amount of money made from prescription sales, pharmacy owners saw an increase in their salaries for a second consecutive year.
2. Continue reading for more on the finances.
3. The retail pharmacy sector in the United States is being buffeted by a number of strong headwinds.
4. DIR reform and income from COVID-19 immunizations are two examples of the developing good trends; nevertheless, there are also other emerging positive tendencies.

Expect independents to keep hanging in there. CONFORM TO THE RECORDS Once more, we make use of the information provided by the National Community Pharmacists Association (NCPA) Digest, which is sponsored by Cardinal Health. You can read the news release by clicking here.

• The digest provides a selection of the 2020 financial and operating data that was supplied by owners of pharmacies.
• These statistics have a number of advantages and disadvantages.
• However, they do offer the only routinely reported and accessible to the public look into the financial state of independent pharmacies.

Additionally, the NCPA gathers more specific financials; however, it does not make this data available to independent experts. As a result of the fact that I do not have access to the full financial report, some of the data that are provided below are estimations.

Nevertheless, the National Community Pharmacists Association (NCPA) has, for the very first time, generously disclosed information on prescription revenues. As a result of these findings, we have revised the historical numbers that were discussed in earlier articles by making some very small adjustments to them.

PROFIT PRIMER The sale of prescription medications, over-the-counter items, vitamins, cosmetics, food, and other types of commodities all contribute to the earnings of a pharmacy. The filling of prescriptions accounts for more than ninety percent of the average independent pharmacy’s income.

The following definitions might help shed some light on the topic of pharmacy profits: The revenues of a pharmacy are subtracted by the cost of items (net of discounts and returns) purchased from a manufacturer or a wholesaler to determine the gross profit of the pharmacy. The gross margin is the proportion of total revenues that corresponds to the gross profit.

The amount of money left over after deducting operating costs and calculating operational profit is referred to as the “gross profit.” Operating expenses consist of the following: (1) payroll expenses, which include the wages, taxes, and benefits paid to the pharmacy’s staff, including the owners of the business; and (2) general business expenses, which include everything else that is required to run the pharmacy, such as rent, utilities, license fees, insurance, advertising, and other business costs.

1. Gross earnings minus operating expenditures are the components that make up operational income.
2. In order for a pharmacy to turn a profit, its total operating expenditures must be lower than its gross earnings.
3. For instance, a pharmacist-owned drugstore may record an apparent “net loss” if the owner of the pharmacy decided to pay themselves a bigger salary rather than declaring a positive net profit.

In this scenario, the pharmacy would be seen to be operating at a loss. The owner’s salary and the pharmacy’s operational revenue are added together to arrive at the owner’s discretionary profit, abbreviated as ODP. In previous years, the ODP was included in the NCPA digest; however, in more recent times, it has been omitted.

• Please refer to our yearly Economic Report on U.S.
• Pharmacies and Pharmacy Benefit Managers for further information on the economics of pharmacies and prescriptions.
• FAB FIVE The following are five reflections on the most recent data: 1) The profit margins of independent pharmacies, on average, have not changed.

In the year 2020, the overall gross margin that independent pharmacies achieved from both prescription and non-prescription items was 21.9%. That is within the range of the numbers that were recorded in the preceding four years, which varied from 21.8% to 22.0%.

• The figures from this year are not entirely consistent with the numbers provided by the United States government, which indicate that both chain and independent drugstores had larger total gross margins.
• According to the findings of the United States Census Bureau for the year 2020, the total average gross margin for the pharmacy business was 24.4%.

(source) The total industry margin is larger than the margin of independent pharmacies due to the fact that front-end non-prescription items sold in chain pharmacies account for a greater percentage of sales and have higher gross margins than those sold in independent pharmacies.2) The profit margins for prescription sales at independent pharmacies are likewise consistent.

1. The gross margins on sales of prescription drugs were 21.2% for the year 2020.
2. The graphic that follows demonstrates that gross margins on prescriptions have been fairly consistent throughout the course of the previous five years.
3. The NCPA sample reported an average revenue of $55.96 per prescription in the year 2020, which is relatively equal to the figure of $55.86 per prescription reported for 2019.

Between $11.50 and $12.00 was the range of annual gross earnings from each prescription for the years 2016-2020.3) The rates of generic medication dispensing in independent pharmacies trailed behind those of the entire market. An unexpected difference has been recorded many times in the NCPA digest.

• The generic dispensing rate, often known as the GDR, is the percentage of prescriptions that are filled with a generic medicine rather than a branded drug.
• The generic dispensing rate for independent pharmacies has trailed behind that of the broader market.
• According to the findings of IQVIA’s research, the GDR for unbranded generics in the entire market was 88.5% in the year 2020.

According to the findings of the NCPA Digest, the GDR for independent pharmacies was just 86% for the year 2020.4) In the year 2020, the median annual income for a pharmacist who ran a single drugstore was around $158,000. According to our best estimates, the owner’s discretionary profit (ODP) for each individual drugstore dropped from around $200,000 in the year 2015 to just $129,000 in the year 2018.

Since then, remuneration has improved, and now stands at an expected 141,000 dollars for the year 2019 and 158,000 dollars for the year 2020. The rise was not the result of a larger prescription volume but rather of improved expenditure control. The NCPA sample found that the average number of yearly prescriptions filled by each pharmacy was decreased in the year 2020 compared to the figure for 2015.

However, overall non-owner payroll expenditures decreased as well, which helped to compensate for the reduced gross profit that each pharmacy in the NCPA sample generated as a result of the lower prescription volume. In recent years, there has been a narrowing in the pay difference between self-employed pharmacists and those hired by other pharmacies.

On the other hand, this chasm has grown wider over the course of the previous several years. In the year 2020, a pharmacist working in a retail, postal, long-term care, or specialty pharmacy made around $124,000 gross per year as their typical base income. See the Job Market for Pharmacists in 2020: Increases in Retail Wages, but Increases in Hospital Employment In other words, owning a pharmacy, with all of the headaches and responsibilities that come along with it, has once more become more lucrative than working for someone else.5) The number of independent pharmacies represented by the NCPA has decreased.

The NCPA has adopted a new approach to measuring the overall number of community pharmacies that are independently owned. The number 21,683 locations of independent pharmacies was arrived at by the NCPA using “NCPA analysis of NCPDP data and NCPA research” for the year 2019.

1. However, beginning with the 2021 edition, NCPA began utilizing IQVIA’s data on retail pharmacy locations throughout the United States.
2. More than one-third of all retail pharmacy outlets are expected to be owned and operated by independent pharmacies in 2020, according to the NCPA’s projections.
3. There is currently very little evidence to suggest that locally owned pharmacies are becoming extinct.

Even though total revenues for this dispensing format have been reasonably consistent, independents have been seeing a decline in their overall market share. Based on an examination of data provided by IQVIA, DCI discovered that the overall number of independent pharmacy sites has remained essentially unchanged over the course of the previous 20 years.

However, during the course of the last five years, the overall number of retail pharmacy locations in the United States, in addition to the number of independent pharmacies, has been on the decline. (For more information, please refer to Section 2.3.3 of our pharmacy/PBM report.) NOT TOADALLY BAD Readers of the yearly economic analyses published by the Drug Channels Institute shouldn’t be surprised to learn about the tough nature of retail pharmacy.

There is now a period of high rivalry in the retail pharmacy industry, which continues to put pressure on prescription profit margins. After being relatively constant for several years, the number of pharmacies in the United States, in all of their various configurations, is now on the decline. The COVID-19 immunizations have resulted in considerable revenues for retail pharmacies, earnings that are fully justified. The Federal Retail Pharmacy Program for COVID-19 Vaccination includes around 41,000 retail pharmacy sites across the US as participants.

1. It covers the majority of small pharmacy networks together with all of the main retail chains.
2. As of the beginning of February, pharmacies in the United States had already delivered around 227 million doses, accounting for more than forty percent of the total COVID-19 vaccine doses that were distributed in 2021.

At this time, pharmacies make $40 from each dosage that is provided. Because there is no cost of goods involved in providing a COVID-19 vaccination, a pharmacy’s total earnings are the same as the administrative fees they charge. For instance, the administration of a two-dose immunization regimen results in a gross profit of $80 for the pharmacy doing the service.

Because of this, the COVID-19 vaccinations and tests offered by CVS Health’s retail pharmacy division contributed to more nearly $1.8 billion in operational earnings for the company in 2021. All pharmacy DIR price concessions will be applied to the negotiated price under Part D, according to the new regulation that has been proposed by the Centers for Medicare and Medicaid Services (CMS).

The CMS regulation would have several consequences on the expenses associated with Part D, including a marginal effect that would be beneficial to pharmacy economics. The Centers for Medicare and Medicaid Services (CMS) anticipates that the net Part D payments to pharmacists will rise by only 0.1% to 0.2% if the DIR is implemented as suggested.

1. I have been writing and publishing reviews of the economics of independent pharmacies for more than ten years.
2. My advice to proprietors of pharmacies has been straightforward: Expand your business, narrow your specialty, or sell.
3. To compete successfully in today’s increasingly consolidated drug channel, a small pharmacy requires either size or distinctiveness to achieve their goals.

If that’s not possible, bow out with class. I continue to be of the opinion that some independent pharmacies will thrive, but not all of them by any means. Last but not least, a polite reminder to my readers who own their own independent pharmacies that I am not a magic magician.