NARD, the United States' largest organization of retail drugstores, will continue to protest.

"We are determined to reform this bureaucratic attitude that the law can be flouted at will," he said. "We earnestly believe the public interest will best be served, and the government program imporved, if local pharmacists are permitted to act as advisors (to the program), their advice heeded, and if they are allowed to dispense drugs and medicines for the people of their communities. We believe the poor are entitled to the same quality and the same availability of service as any one else."

Mr. Simmons noted that pharmacists have an important role to play in all government health programs.

"The broad question as we view these rapidly developing health and welfare programs," he explained, "involves the degree to which independent retail pharmacists will be allowed to apply their professional knowledge and competence to developing and carrying out their objectives. Maximum participation is imperative to assure the fullest benefit from competent pharmaceutical service."

OEO REPLY TO NARD CHARGES SAYS MEDICAID VENDOR PLANS INFLATE RETAIL DRUG COSTS; NEW NARD LETTER TO CONGRESS AGAIN URGES MOVING OEO CENTERS TO H-E-W

The Office of Economic Opportunity (OEO), replying to NARD's demand that OEO health centers be operated under Medicaid, has charged that vendor plans under Medicaid cause "inflation of retail drug costs."

As retail druggists usually pay "higher acquisition costs. . . Medicaid funds subsidize the mfrs.' differential pricing structure," OEO said in a five-page report sent to senators and representatives visited by NARD members in July ("The Pink Sheet" July 15).

Terming Medicaid's "inflation" of drug costs "an anomaly of the present drug pricing structure," OEO's report told the lawmakers that "Medicaid drug programs vary from state to state; they characteristically pay on a cost plus fee basis, or a cost plus a percentage (sometimes as high as a 50% markup) plus fee."

NARD responded to the OEO report by sending a letter to all members of Congress charging OEO with "working a hardship on the poor people it is designed to serve, and, at the same time, forcing small retail establishments in poverty areas to go out of business."

The NARD letter urged, as the assn. did earlier, that (1) the OEO health centers be transferred to H-E-W and operated under Medicaid; (2) drugs provided to center patients be supplied through a vendor system; (3) govt. dispensaries in centers should be closed “where private pharmacy services are on hand"; and (4) drug mfrs.' pricing policies "which discriminate against . . . the independent retail drug store should be ended.

Senate Appropriations Cmte. Report Points to Research On Generic Equivalency

Congress never intended that OEO "use its appropriations to make govt. employees out of the nation's pharmacists and to close drug stores by widespread and unfair govt. competition," NARD Exec Secty. Willard Simmons said in the two-page letter, which was accompanied by a page of complaints from pharmacists in seven cities.

NARD's appeal apparently fell on deaf ears in the Senate Appropriations Cmte., which earmarked $90 mil. of OEO's $1.9 bil. for the health centers. In its report on the FY 1969 appropriation for the agency, the Senate cmte. specifically directed it to spend "not less than $90 mil. for comprehensive health centers."

This would permit OEO to fund more of the centers, approaching LBJ's goal of 50 by the end of 1968. OEO now has 47 centers funded, of which some 34 are in operation, fully or partially. The bill containing the OEO appropriation is the first item of business on the Senate agenda when it returns Sept. 4 from its political convention recess.

MINNESOTA RX MEN AGAIN ASK DRUG RESTRICTION

STATE ASSOCIATION WILL SEEK COMPROMISE WITH FOOD STORE MEN TO END

10-YEAR BATTLE

Minnesota pharmacists will soon begin still another campaign in their decadelong battle to convince the state legislature that some over-the-counter drugs should be restricted to sale by RxMen.

All previous attempts to gain this objective have been foiled because of strong opposition of Minn food store interests.

Spearheading the new drive will be the Minnesota Pharmaceutical Assn. According to its new secretary, Donald Dee, talks are now going on with the food retailers in an effort to draft a bill which will be acceptable to them, as well as to Pharmacy.

Similar: Mr. Dee said that, in all probability, the bill that is introduced will be similar to the measure considered-but never brought to a vote-during the last Minnesota legislative session.

Essentially, this bill sought to give the Minnesota Board of Health the authority to restrict the sale of o-t-c drugs in any one of 5 different categories. However, the board would not have been able to take such action without holding hearings on each drug to be restricted.

Fed Up: Mr. Dee said that, by now, all the parties on both sides in this legislation are fed up with fighting about it, and that some sort of compromise can probably be worked out in the upcoming session.

Mail-Order Rrs: Massachusetts state court has entered final decree in state pharmaceutical assn.'s case against Federal Rx Service Inc., of Madrid, Iowa. Decree rules that the Iowa mail-order firm's solicitation in Mass.-by direct mailings, salesmen, ads or any other means-of orders to fill Rxs is "illegal under the statutes of Mass." The methods used to implement or enforce the order will be interesting. APhA Legal Div. Director Robert Steeves reports that the Mass. assn. has asked "APhA assistance in the further proceedings in the case."

[From Drug Topics, May 25, 1970]

SIMMONS TELLS AUSSIES OEO HURTS U.S. DRUGSTORES

SYDNEY, AUSTRALIA-Willard B. Simmons, Executive Secretary of The National Association of Retail Druggists, in Chicago, Ill., charged that policies of the U.S. Office of Economic Opportunity are working hardships on the poor and have put privately-owned drugstores out of business.

Mr. Simmons made the statement in an address at the opening of the 1970 International Conference of the Pharmacy Guild of Australia.

Explaining the role of independent retail pharmacies in federal programs, Mr. Simmons said the law has not always been followed in operating the Office of Economic Opportunity's neighborhood health centers. He said that although the law requires the utilization of local pharmacies for medications for the indigent, some of the centers "stock drugs and hire pharmacists to dispense the prescription."

"We have protested this tactic on several counts," Mr. Simmons explained. "First it denies the patients the fundamental right of freedom of choice of their pharmacy. It forces them, in many instances, to travel long distances from their homes to the center to have prescriptions filled, rather than being able to patronize a pharmacy in their neighborhood, Further, it denies them, in most instances, ready access to pharmacists for additional advice, cautions, or for supplementary drug needs. Finally, it deprives local pharmacists, many of them operating in deprived neighborhoods and providing employment for local people of much needed prescription volume.

"These OEO-operated dispensaries already have put some local pharmacies out of business, eliminating a source of employment for local residents and obliterating a source of tax revenue for federal, state and metropolitan governments.

"The towering irony is that private pharmacies' own taxes have been used by an agency of government to put them out of business." Mr. Simmons said The

NARD, the United States' largest organization of retail drugstores, will continue to protest.

"We are determined to reform this bureaucratic attitude that the law can be flouted at will," he said. "We earnestly believe the public interest will best be served, and the government program imporved, if local pharmacists are permitted to act as advisors (to the program), their advice heeded, and if they are allowed to dispense drugs and medicines for the people of their communities. We believe the poor are entitled to the same quality and the same availability of service as any one else."

Mr. Simmons noted that pharmacists have an important role to play in all government health programs.

"The broad question as we view these rapidly developing health and welfare programs," he explained, "involves the degree to which independent retail pharmacists will be allowed to apply their professional knowledge and competence to developing and carrying out their objectives. Maximum participation is imperative to assure the fullest benefit from competent pharmaceutical service."

FDC DRUGS AND COSMETICS

F-D-C REPORTS

August 12, 1968.

OEO REPLY TO NARD CHARGES SAYS MEDICAID VENDOR PLANS INFLATE RETAIL DRUG COSTS; NEW NARD LETTER TO CONGRESS AGAIN URGES MOVING OEO CENTERS TO H-E-W

The Office of Economic Opportunity (OEO), replying to NARD's demand that OEO health centers be operated under Medicaid, has charged that vendor plans under Medicaid cause "inflation of retail drug costs."

As retail druggists usually pay "higher acquisition costs. . . Medicaid funds subsidize the mfrs.' differential pricing structure," OEO said in a five-page report sent to senators and representatives visited by NARD members in July ("The Pink Sheet" July 15).

Terming Medicaid's "inflation" of drug costs "an anomaly of the present drug pricing structure," OEO's report told the lawmakers that "Medicaid drug programs vary from state to state; they characteristically pay on a cost plus fee basis, or a cost plus a percentage (sometimes as high as a 50% markup) plus fee."

NARD responded to the OEO report by sending a letter to all members of Congress charging OEO with “working a hardship on the poor people it is designed to serve, and, at the same time, forcing small retail establishments in poverty areas to go out of business."

The NARD letter urged, as the assn. did earlier, that (1) the OEO health centers be transferred to H-E-W and operated under Medicaid; (2) drugs provided to center patients be supplied through a vendor system; (3) govt. dispensaries in centers should be closed "where private pharmacy services are on hand"; and (4) drug mfrs.' pricing policies "which discriminate against . . . the independent retail drug store should be ended.

Senate Appropriations Cmte. Report Points to Research On Generic Equivalency

Congress never intended that OEO “use its appropriations to make govt. employees out of the nation's pharmacists and to close drug stores by widespread and unfair govt. competition," NARD Exec Secty. Willard Simmons said in the two-page letter, which was accompanied by a page of complaints from pharmacists in seven cities.

NARD's appeal apparently fell on deaf ears in the Senate Appropriations Cmte., which earmarked $90 mil. of OEO's $1.9 bil. for the health centers. In its report on the FY 1969 appropriation for the agency, the Senate cmte. specifically directed it to spend "not less than $90 mil. for comprehensive health centers."

This would permit OEO to fund more of the centers, approaching LBJ's goal of 50 by the end of 1968. OEO now has 47 centers funded, of which some 34 are in operation, fully or partially. The bill containing the OEO appropriation is the first item of business on the Senate agenda when it returns Sept. 4 from its political convention recess.

The bill also contains $67.3 mil. for FDA, the same amount as approved by the House, and $3.7 mil. below the budget request. Of the cut, some $1.7 mil. was scheduled for drug abuse control, which was shifted to the Justice Dept. after the budget was submitted.

The Senate report said the amount recommended for FDA provides $1 mil. in program increases which will enable FDA to give "increased emphasis" to clinical studies on the side effects of OCs, and to initiate research on the biological equivalency of generic drugs. The latter research "is a prerequisite to the development of equivalency standards necessary for the resolution of the problem of generic v. brand-name drugs," the report said.

While the Senate cmte. report gave no indication of enthusiasm for NARD's proposal to shift OEO's health functions to H-E-W, there long has been discussion in Washington of giving H-E-W control over all govt. health activities. While the basic philosophy behind such a move has considerable support, the odds appear against it as long as OEO remains an independent agency

OEO has withstood many of the efforts of older-line govt. depts. to cut into the poverty program's operations. Similar success might be achieved by comparing the innovative OEO health prpgrams with the generally recognized bureaucratic lack of creativity in much of the sprawling H-E-W Dept.

The OEO response to NARD's July march on Washington flatly denied many of the assn.'s charges of harm to pharmacists as a result of the OEO centers. "The facts do not support" NARD's charges "that pharmacies are closing, particularly in Denver and Boston, because of Neighborhood Health Centers (NHC) opening in the area," OEO said.

To support its denial, OEO sent the congressmen a copy of a newspaper article attributing Denver drug closings to a price war, and a letter from the city health dept. saying "not one drug store has gone out of business because of the impact of the center."

OEO Says Productive Communication With NARD Members "Difficult To Achieve" Discussing "the supposition that an on-site dispensary at a NHC will attract the few purchasers of Rx drugs in an area," OEO repliecd "this is not so . . . the opposite is usually the case." Before a center opens patients usually get drugs at a country or city hospital or "because of the absence of medical care, never seek Rx drugs at all," OEO said.

Opening of a center "generates a greater demand for high quality pharmaceuticals among a population who seldom sought Rx drugs," OEO added, noting that the centers also help thousands of persons eligible for Medicaid or welfare to enroll in those programs. "Thus consumers are enabled to obtain drugs at the pharmacy of their choice, when they had not, because of sheer poverty, been able to do so before," OEO said.

OEO also flatly denied "the allegation that patients are 'directed to govt. dispensaries' or coerced to obtain drugs at health centers." Contending that "the opposite, again, is really the case," the agency said centers "direct patients to several sources of Rx drugs" by telling them of "their right to procure drugs where they wish, by assisting enrollments in the state Medicaid program, and by the outreach work of home health aides and visiting nurses.'

In a direct criticism of NARD, OEO pointed to "the difficulties intrinsic to dealing with the diversity of organizations claiming to represent the small pharmacist." OEO reported lengthy discussions with NARD, APhA and at least 12 affiliated and unaffiliated city and state assns.

NARD, the govt. report continued, "claims to 'represent' 40,000 retail drug stores, but it is difficult to obtain their membership rolls. Thus productive communication and program development in coordination with NARD's members in local programs has been most difficult to achieve."

AVELLONE SAYS NARD AND APHA CAN COOPERATE MORE, BUT MUST BE WARY OF ANTITRUST HAZARDS; NARD PRESIDENT WARNS OF GOVERNMENT INTRUSION

NARD and APhA have "ample opportunities for cooperative and coordinated effort," but both "must take into consideration the basic orientation of each assn., Exec Cmte. Chairman Nick Avellone told the NARD convention in Las

"

He pointed to the two assns.' pledge of unified effort to support Sen. Hart's (D-Mich.) MD-dispensing bill, and the coordinated APhA-NÂRD criticisms of PMA's call for publicizing Rx prices ("The Pink Sheet" Nov. 4, 1968, page 14).

Although Avellone noted that there "are legal and regulatory hazards to be avoided" when the assns. work in tandem, his comment represented a continuation of the efforts of some pharmacy leaders to heal the breach between APhA and NARD while still recognizing their basic distinctions.

He decried the fact that "a few pharmacists have jumped to the conclusion that NARD and APhA were at loggerheads" because NARD "found it necessary to decline membership in the Natl. Pharmacy Insurance Council." Avellone reiterated NARD's position that it did not join NPIC because assn. counsel Earl Kintner, former FTC chairman, warned of antitrust exposure.

The Bay Village, Ohio, pharmacist said NARD rates "the problems of thirdparty payment programs the number one concern in pharmacy today.' NARD, he said, "is as up-to-date on these developments as well as anyone in the nation."

P-D Chairman Says Third-Party Payments Will Boost Generic-Named Products Outgoing President Michael Perhach told the Oct. 12-16 convention that one of the major problems facing pharmacists is communications with each other, among assns., with govt. and with the public. He urged "constant and continuing emphasis on the facts . . to convince some of our bureaucrats and some of

our media people that pharmacists indeed contribute to the health and welfare of the public and that they, in turn, are justified in establishing an equitable profit margin."

The NARD president added that “if we are to keep from being overwhelmed by antagonists on the natl. scene, our congressmen and senators must have the facts about . . . retail pharmacy We must emphasize that the public will be better served . . . through the available pharmaceutical services of community pharmacy, rather than through any institution or govt. dispensary."

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Govt. pharmacy programs also drew the attention of NARD Exec Secty. Willard Simmons in his convention report. "Instead of allowing patients to exercise their legal right to have their Rxs filled at the drugstore of their choice, OEO administrators make them travel unnecessary distances, wait for long periods of time, only to receive their medicinesin many cases-without the benefit of personal advisory service available to them in their own community pharmacy," Simmons said.

These tactics have resulted in closing of a number of retail pharmacies, of loss of jobs to the citizens of the community, and loss of tax revenues," he added. "Yet these things are done under the misnomer of 'economic opportunity'."

Parke, Davis Chairman Austin Smith told the NARD meeting that as thirdparty payment for drugs grows, generic-named products will probably increase their proportionate share of ethical sales, but brand-name drugs will continue to dominate the market. "The presence of this third party will probably bring a closer pricing between the branded products and generics," Smith added.

Perhaps the purplest prose presented to NARD came from ED Wimmer, VP of the Natl. Federation of Independent Business. Harking back to NARD's support of fair trade, he said "if everyone who stood to benefit . . . had acted as NARD acted, prostitution of name brands by parasite-discount houses now turning the market place into an Egyptian bazaar would never have seen the light of day."

Wimmer also blasted mfrs.'s price discriminations, advocates of generic drugs, and chain stores. He quoted a Kroger ad saying: "Our professional pharmacists don't dirty their hands with other work; they spend their time professionally filling your Rxs."

Wimmer said that "on the other side of this counterfeit coin one finds the statement of a supermarket chain official who said 'it is pure hogwash to say that a pharmacist lends prestige to a supermarket. What a pharmacist brings in is profits, and if he doesn't where is his prestige?'" Other speakers on NARD's program included House Majority Leader Albert (Okla.), Minority Leader Gerald Ford (Mich.), Rep. Wright Patman (D-Tex.), and President Nixon's consumer advisor, Virginia Knauer (see story, page 10).

Among the 31 resolutions adopted, virtually without debate, at NARD's closing session Oct. 16 were ones:

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