Wal-Mart rolls out drug program four months early
Discounter will begin its $4 generic prescription program statewide in Florida by Oct. 6, four months ahead of schedule.
By Parija B. Kavilanz, CNNMoney.com staff writer

NEW YORK (CNNMoney.com) -- Wal-Mart announced Thursday that it is accelerating its $4 generic prescription program statewide in Florida nearly four months earlier than expected.

Wal-Mart (Charts) said it pushed forward its schedule because of customer demand and requests from Florida state officials.

The program was originally planned to be rolled out statewide in January 2007. The retailer said it plans to roll out the plan beyond Florida in the weeks ahead.

Wal-Mart has also expanded the program to include 314 generic prescriptions available for up to a 30-day supply at commonly prescribed dosages, up from an earlier number of 291 generic medicines.

The list has been expanded to include medicines such as the oncology drug Megestrol and Lovastatin, which is used to treat cholesterol.

The retailer said the new list of generic drugs now represents nearly 30 percent of prescriptions currently dispensed in the 235 Wal-Mart, Neighborhood Market and Sam's Club pharmacies throughout Florida.

Wal-Mart initially announced the launch of the pilot program in Florida last month to sell generic prescription drugs for as low as $4 for a 30-day supply for things like allergies, high cholesterol, high blood pressure and diabetes.

Wal-Mart's more than 94,000 employees in Florida will also be eligible for the program. Additionally, the company said employees can use their 10 percent associate discount for cash sales, although this won't apply if they process the purchase through their medical insurance plan.

Public Citizen, a Washington-based healthcare watchdog group, said Wal-Mart's efforts in reducing prescription drug costs for Americans is a "step forward" for the retailer.

"At the same time, it leads us to ask why Wal-Mart couldn't do it earlier and why can't they roll it out nationally," said Dr. Peter Lurie, deputy director of the group.

"To me the question illustrates just how high the costs of prescription drugs really are if a large retailer can come in and knock down prices this low," Lurie said.

However, the National Community Pharmacists Association (NCPA), a trade group that represents 24,000 independent pharmacists, said Wal-Mart's $4 generic drug program is actually a disservice to its customers.

"Only 143 drugs on the list are generic drugs. The rest are just different dosages of the same medicines," said Charlie Sewell, senior vice president of government relations with the group.

"Many of the drugs that Wal-Mart is discounting are older drugs that already tend to be cheaper," said Sewell. "There are 8,000 drugs that the FDA classifies as generic. So the 314 Wal-Mart has included in this program is also a very small percentage."

"There is no way that Wal-Mart is making money from this program. This is a public relations stunt. Wal-Mart is using these drugs as a loss-leader to drive up traffic in parts of the store," he said.

For its part, Wal-Mart maintained that the retailer is making money from each sale of the drug. Moreover, the retailer said it saw 36,000 new prescriptions in 65 Tampa Bay area pharmacies in the first 10 days after it debuted the plan.

Wal-Mart's rival Target (Charts) announced Thursday it too would match Wal-Mart's lower prices on the generic drugs in all Florida Target pharmacies beginning Friday, the second time in a month the discount chain has immediately matched the moves of its larger rival.

But some of the nation's largest drugstore chains like Walgreen (Charts) and CVS (Charts) said they did not believe that Wal-Mart's latest initiative would negatively impact their business.

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.