Limited Prescription Transfers in Ohio - Unfair Advantage for Chains?

I’m originally from Ohio (and hope to someday get back there and build a house on the family “homestead”). I even maintain my license to practice pharmacy in Ohio (though I’ve resisted the urge to reciprocate and get multiple state licenses as I’ve moved about the Midwest in non-dispensing roles).  So, I tend to try to keep an eye on the goings-on in Ohio related to pharmacy.

Effective Jan 1, 2011, a new rule, promulgated by the Ohio State Board of Pharmacy, will restrict patients to a single transfer of a prescription.  The DEA already restricts the transfer of controlled substance prescriptions (those substances that fall under the Controlled Substance Act) to a single transfer, but this will expand the reach of that particular restriction to all prescriptions that are filled within the State of Ohio.

The DEA restricts the transfers of controlled substances in order to help control or prevent potential diversion and/or abuse.  The State Board in Ohio is apparently concerned with patient safety (as they should be), as there is an increased risk of errors when a prescription is transferred.

Here is the scenario –

Ms. A goes to her local (potentially independent) pharmacy, and has her prescription for Lasix (actually furosemide) filled (using an example product that is rarely “abused”, except by thoroughbred racehorses, but that’s a different story).  She happily pays her $4 (very inexpensive generic drug, and this price likely includes a 300+% margin), is dispensed her medication, and departs.  25 days later, Ms A is reading the Sunday paper, and planning her week, which includes a refill of her medication (which her pharmacist instructed her to take in the AM, to avoid troublesome interruptions to her sleep visiting the toilet), when she spies a coupon in an advertising circular (could be a traditional drug store chain, a mass merchandiser, or a grocery chain, all of whom use this technique).  The coupon offers her a “gift card” (of varying value, depending on the competitiveness of the geography in which she resides) in exchange for transferring a prescription to their pharmacy.  “Hmmm” she says to herself.  “My prescription is only $4, which is less than the gift card.  I could make money on this deal!”

So, throwing caution and loyalty to the wind, she takes her almost empty pill bottle into said chain store, and asks to have the prescription transferred.  Depending on the store, she could be told anywhere from a 15 minute to a 2 day wait.  But, in any event, at some point, the pharmacist from the recipient store calls the pharmacist at the pharmacy losing the script and requests a transfer.  The pharmacists exchange the prescription information, the receiving pharmacist reducing the information to writing, and upon completion of the transfer of information, treats the record as a new prescription (retaining the original written date, as well as maintaining (hopefully) the accuracy of the number of remaining refills, and other pertinent information) and fills it.  When dispensed, Ms. A receives a gift card of somewhere between $4 and $50 (some may only go as high as the value of the medication dispensed) and goes on her merry way, at minimum getting her drugs basically for free.

So, you may say to yourself – what’s wrong with that?  Lasix is not an abused drug (so the DEA style restriction doesn’t apply), and isn’t this benefiting the patient (financially at least)?  Aren’t medications already overpriced?  Why shouldn’t people be able to leverage the system to get what amounts to a discount as the free market of pharmacy tries to gain share?

According to the Ohio State Board of Pharmacy, the manual transfer of that prescription information is where the concern lies.  Pharmacists are human, after all, and because of thinning profit margins (it happens everywhere, by the way – not just in pharmacy, though this is a favorite complaint of pharmacists and pharmacy owners – both chains and independents) the volume of prescriptions that must be filled by the same staff is increasing (just to maintain a steady net profit).  So, pharmacists are busier and busier, and the error rate in this situation is likely NOT to go down.  Apparently in an effort to reduce the potential for errors, the Board has determined that you can only transfer once, and then you’re done.

EXCEPT – if the prescription is “maintained within a real-time online pharmacy system.”   It would appear that the Board was swayed to believe that a real-time online pharmacy system (where pharmacies are connected electronically and can potentially transfer the prescription between stores electronically without requiring a manual, verbal transfer of information  between pharmacists) removes the potential for error in the transfer of the information, and should not be limited by this rule.

Objectively, it actually make sense – you take the human factor out (at least out of the transfer of the information) and you’ve reduced the risk.

Some in Ohio (specifically independent pharmacies) are arguing that this unfairly advantages chain pharmacies, and disadvantages independents, as chains already maintain these systems, and can easily do so since they are centrally owned.  Independently owned pharmacies are extremely unlikely to use such a system.

So, in today’s world (2010) Ms. A can transfer her Lasix to the chain/mass/grocery pharmacy, get her gift card and then transfer it back to her original pharmacy next month.  In tomorrow’s world (2011) Ms. A can transfer the prescription to the chain/mass/grocery pharmacy, get her gift card, and then has to continue to fill the prescription at that pharmacy (or one of their other locations if they use a real-time online pharmacy system) until refills run out, or she has her prescriber write a new prescription, which she can take anywhere she wants.

Does this advantage chains?  A little, though chains already maintain many advantages in the marketplace, from purchasing power to convenience.  Does this add to it?  Yes, a little.  Is it unfair?  That’s the question.  Some would like to say that the Board is bowing to the wishes of the large pharmacy chains, but I would argue that the Board is bowing to reason.  If you’re attacking errors (which the Board should) then you have no good argument against the “real-time online pharmacy system” allowance.  If you’re attacking the competitive advantage of chain pharmacies, then you have a beef – but that’s not the role of the Board of Pharmacy.

Some independent pharmacy owners may think the Board of Pharmacy should be on “their side.”  But, the Board of Pharmacy should be impartial, and should be concerned with the safety and welfare of the public as it relates to the practice of pharmacy – not the competitiveness of pharmacy marketplace.

Independents cannot stop the commoditizing of the dispensing service, its happening (or you could argue already happened).  What they can do is offer services chains won’t, or offer the same services at a higher level (which the chains can’t or don’t care to). Medication Therapy Management, for example (see part of my previous post on pharmacy reimbursements).

The Board in Ohio may, in other cases, have unfairly given advantages to chains (not sure and certainly not debating here), but in this case, I think they allowed a reasonable exception, because of the goal they were working to accomplish.