Inner City People Pay More for Prescription Drugs!

The National Association of Neighborhoods (NAN) engaged Howard University to survey the Metropolitan Washington, DC area to see if there were cost differences in the purchase of commonly used prescription drugs. The following are excerpts from the Howard University report. Howard University learned that "There was a definite pattern for all the study medications (Prilosec® -Claritin® -Lipitor® -Norvasc® -Paxil®) based on household income, especially in Wards 7 & 8 in the District (wards in the District of Columbia that have large populations of low income households) and the outlying suburbs."

Pharmaceutical manufacturers have recently experienced considerable criticism and much blame in the often strident debate over ever increasing prescription drug prices. Critics have generally attributed the cause of this phenomenon to the manufacturers.

This study, undertaken by Howard University College of Medicine during August 2000 was designed to determine price variations by comparing and analyzing prescription drug price data from three types of pharmacy models dispensing medications in the Metropolitan Washington, D.C. area.

Data was collected by trained surveyors employing, both in-person and face-to-face, visits to 89 pharmacies and telephone surveys to the same pharmacies five to seven days following the in-person visits. Follow-up telephone surveys were designed to assess consistency in price and price variation over short periods of time. In addition, 21 Internet prescription drug sites were surveyed. In total, the project surveyed 110 pharmacies and Internet sites.

Pharmacies included those located in the District of Columbia, Montgomery County, Prince George's County, and Northern Virginia which were randomly selected to reflect the various socio-economic levels and cultural populations existing in the targeted areas. In addition, to regional locations, selected pharmacies were further delineated into three types: retail chain pharmacies, combined retail chain, and independent pharmacies. Retail chain pharmacies included those chain pharmacy outlets that are historically associated with retail prescription dispensing and participate in common marketing and buying plans. Examples include CVS and Rite-Aide.

Combined retail pharmacies are those co-located within another retail store with other commercial interests. Combined retail chain pharmacies might have contractual arrangements with the retail outlet, but not to be directly owned or operated by the retail outlet. Examples include: K-Mart, Safeway and Giant.

Independent pharmacies are retail outlets private or independently owned facilities not affiliated with common marketing or buying schemes. They are generally small facilities and are localized to a single community store. Examples include neighborhood pharmacies.

The results of the study imply that, "By searching the Internet, consumers can save considerably on purchases of the study drugs." The study further notes that, "… prescription prices in chain stores are consistently higher, followed by the independent/private and the combined retail. Regardless of the geographic region, the chain retail outlets tend to price the selected drugs in this study higher than other type of retail outlets."

Additional tips for consumers purchasing prescription drugs include:

Purchasing medications in quantities is a cost-saving device.

Purchasing generic vs. named-brand drugs can generate savings.

Consumer groups, such as senior citizen groups, should consider organized group purchases.

Consumers should shop around before making purchases.

Telephone checks will yield essential information on price variations.

Recognize that some chain pharmacies have variations in price for the same drugs.

 

NAN Corporate Roundtable
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