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be forwarded to me. I assume that the resolution makes reference to S. 3614, which I introduced July 13 of this year.

Actually, I am surprised to find that the Louisiana State Pharmaceutical Association has formally stated its opposition to this measure, especially in view of the fact that it is my understanding that the American Pharmaceutical Association has been sympathetic to this approach. I am informed that as early as 1955 it supported the use of official drug names and adopted the following resolution:

Whereas it is agreed by all pharmaceutical authorities that generic names need chemical or unregistered names of drugs, or the names recognized by the USP, International Formulary, or Homeopathic Pharmacopoeia of the United States, or the names adopted by the Council on Pharmacies or Chemistry of the American Medical Association; and

Whereas the use of generic names is therefore, in company with the highest ethical standards of the medical and pharmaceutical professions: Be it

Resolved, That the American Pharmaceutical Association, as such, believes in and encourages the use of the generic names for general drug products.

A similar resolution was approved in 1956. It reads in part:

Resolved, That the American Pharmaceutical Association supports and encourages the use of generic names in the prescribing and dispensing of drugs by the medical and pharmaceutical profession.

Other groups, such as the American Public Health Association, have also endorsed the use of official names for drugs.

I suspect that many of your membership are not fully aware of just what my bill would provide; it is in no way deleterious to the integrity of your profession. Basically, it would require that drugs furnished under programs financed by the federal government be provided on an official name basis. I am sure that no one is more aware than you and your colleagues of the tremendous savings which would result not only to the federal government but also to the state and local governments which participate in the federal programs. The bill would not require that the drugs used be purchased from the company offering the lowest price, and I envision that it would be implemented with standards which would ensure the purchase of quality drugs. The success of the armed services and many of our hospitals in securing drugs on an official name basis is a good indication that there are no unsurmountable obstacles to providing drugs elsewhere by official name.

It has been suggested to me that pharmacists are concerned about the furnishing of drugs on the basis of official name because it is common for their markup to be a percentage of wholesale price. It has been further suggested by some of your colleagues that the institution by the profession of a “professional fee” for all prescription fillings, which would be more or less standard regardless of the wholesale price of the drugs, would remove much of the objection to providing drugs by official name, and may actually be preferable to present practice. I certainly have no intentions of sponsoring any legislation which would put our pharmacists out of business, and my bill would certainly permit the type of practice which I have just prescribed.

I would be interested in receiving any suggestions or comments which the Association may care to offer on this matter. I feel confident that if we work together in a spirit of genuine cooperation we can greatly benefit all of our citizens and at the same time preserve the integrity of the pharmaceutical profession. With every good wish, I am, Sincerely,

RUSSELL LONG.

TRADE AND GOVERNMENT MEMOS Chain Inroads into Pharmacy Practice and the retail drug business generally make it imperative for the profession to seek a new and expanded role in the health area, APhA Exec Director William Apple warned the D.C. Pharmaceutical Assn.'s meeting July 18. Noting the “dramatic” growth in chain Rx volume during the past decade, Apple also pointed out that chains enjoy 87.5% of total retail drug dollar volume in the Washington, D.C. metropolitan market.

“Pharmacists who see their future in chain drug stores as owners, managers or even employees have good cause for being optimistic,' Apple said. “On the other hand, pharmacists who believe that the independent drug store is an indestructible American institution might

recognize that their future is more precarious than some people would

have them believe." But Apple made it clear that he doesn't believe the future for self-employed pharmacists is in the traditional merchandising type of situation, except perhaps in rural areas which haven't yet attracted chains. In the past, he said, “every new generation of pharmacists has entered into practice with the objective of someday becoming owners of a pharmacy. In the last few years, graduates have started to realize that some awesome obstacles have developed to reaching this ownership objective.

“During the past few decades, there has been a significant shift in the ratio of employed and self-employed pharmacists. Today, employed pharmacists are in the majority. If the trend continues, in the future, we could start the 21st Century with two-thirds and even three-fourths of our professional population in the employee category.”

The current “transition period” in health care- -marked by manpower shortages and vastly increased involvement of govt. and other third-party paying agenciesprovides a "unique opportunity” for pharmacy to establish itself as a health profession, Apple continued. "Pharmacy must be prepared to demonstrate with facts both the content and value of its professional services,” he added. “In the past, we have relied on the historical benchmarks of the retail distributive function and the average markup for this function."

"It would be tragic indeed for pharmacy to unshackle itself from the medicine and the mfrs. only to find itself in bondage to chains, institutions and unions,' Apple said. “The survival of the self-employed pharmacist is essential to the welfare of the employed pharmacist. As long as there are opportunities to move from employed to self-employed, the salaried professional can maintain his independence and demand that there be no interference with his professional prerogatives.

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6 bil.

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5 bil.

The chain drug industry continued to set performance records in 1969. On a 10.6% sales increase, second largest of the decade, the industry's annual volume reached a record $6.54 billion.

This figure, in turn, gave the chain drug industry a record 54.9% of the $11.9 billion* retail drug market, up from 51.7% in 1968.

The annual CHAIN STORE AGE survey of 1,500 chain drug stores also revealed the following information: • Last year, chain drug stores averaged $88 of annual sales per square foot of selling space, $4-asquare-foot more than the $84 recorded in 1968, and $23 better than the $65-per-square-foot turned in by the nation's discount houses. The increase, agree most chain people, is due to inflation, trade-up, and the wider selection of higher-priced merchandise available in new stores. • The typical chain drug outlet's gross margin in 1969 dropped to 33% from 1968 figure of 33.2%. Reason: In another year of rising costs, chains often chose not to pass these costs on to the consumer, choosing instead to remain competitive on price.

Sales in $ billions

4 bil.

1965

1966

1967

1968

1969

CHAIN STORE AGE, APRIL 1970

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U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 1970

50–291 0

COMMITTEE ON COMMERCE

WARREN G. MAGNUSON, Washington, Chairman JOHN O. PASTORE, Rhode Island

NORRIS COTTON, New Hampshire VANCE HAR KE, Indiana

HUGH SCOTT, Pennsylvania PHILIP A. HART, Michigan

WINSTON PROUTY, Vermont HOWARD W. CANNON, Nevada

JAMES B. PEARSON, Kansas RUSSELL B. LONG, Louisiana

ROBERT P. GRIFFIN, Michigan FRANK E. MOSS, Utah

HOWARD H, BAKER, JR., Tennessee ERNEST F. HOLLINGS, South Carolina CHARLES E. GOODELL, New York DANIEL K. INOUYE, Hawaii

MARLOW W. COOK, Kentucky
JOSEPH D, TYDINGS, Maryland
WILLIAM B. SPONG, JR., Virginia

FREDERICK J. LORDAN, Staf Director
MICHAEL PERTSCHUK, Chief Counsel

S. LYNN SUTCLIFFE, Staf Counsel
ARTHUR PANKOPF, Jr., Minority Staff Director
ROBERT J. Woody, Minority Staj Counsel

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