Two drugstore chains representing nearly half the Washington area market announced plans yesterday for campaigns to persuade consumers to buy generic substitutes instead of name brand drugs when they have prescriptions filled in Maryland.
Officials for Drugfair and Peoples Drug Stores said they are responding to a Maryland law that promises million dollar savings for consumers and heftier profits for pharmacies. The law took effect nearly a year ago, but the state list of approved drug substitutes has not been available until now.
At a press conference yesterday in Silver Spring, Del. Luiz Simmons (R.-Mont.), sponsor of the law, said the substitutions will save Maryland consumers about $6 million over the next year. No figures were available on the added profits for drugstores operating under the new law.
"Nobody around here knows -- it would be a blue-sky guess to try and estimate," said Paul S. Forbes, a spokesman for Drugfair.
Drugfair was one of the most active supporters of the new law, which permits the pharmacist to substitute a lower-priced generic drug for the prescribed name brand unless prohibited by the physician. The substitute drug must be on the state list mailed out last week to 14,000 physicians and pharmacists in Maryland, or it must be approved by the doctor.
The generic name is the chemical name for the drug. Pharmacists buy generic drugs for less than the name-brands.
During the press conference, Drugfair officials gave hydrochlorothiazide -- often prescribed for patients with high blood pressure -- as one example of the price variations. As a generic drug, hydrochlorothiazide can be purchased at Drugfair for $3.25 for 100 tablets, 50 milligrams strength. Using the brand names, the same quantity of medicine would cost $10.15 under the Esidrix label, $9.55 under the Oretic label, and $6.35 under the Hydrodiuril label, officials said.
Myron D. Gerber, president of the chain, which has an estimated 21 percent of the sales in the Washington market, said his company can make twice as much money on the generic hydrochlorothiazide as on the more expensive name brands like Esidrix.
Under the new law, Drugfair will be able to collect that extra profit, he said. But it was not allowed under the old statute, which required that pharmacists pass along the entire savings on generic drugs to consumers, he said.
The same restrictions will exist on generic drugs sold in Virginia and in the District of Columbia, Gerber said. As a result, the chain does not unilaterally substitute generics for name brands in those jurisdictions, he said. To inform Maryland consumers that substitutions will be available now under the new profit law, Drugfair plans an aggressive advertising and educational campaign, Gerber said.
Leonard DeMino, vice president of pharmacy for Peoples Drug Stores, said his company -- which has 26.5 percent of the Washington area market -- aslo is planning a vigorous campaign on substitutions in Maryland.
"We have been substituting, with the advice and consent of the physician and the patient, but we haven't been aggressive about it," DeMino said.
A spokesman for a third drug firm, Dart Drug Corp., said the new Maryland law will not have any immediate impact on the way his company operates.
"I just received the new formulary (of generic substitutes for Maryland) and I haven't analyzed it yet," said Boris Osheroff, director of professional relations for Dart. With 26.1 percent of the Washington area market, Dart is slightly behind Peoples and ahead of Drugfair in sales.
Osheroff said Dart pharmacies have been substituting generics for name-brands "with the knowledge of the doctor and the patient."
One other large chain in the Washington market -- Giant Pharmacies -- will be able to dispense fewer, rather than more, generic substitutes under the new law, and without telphoning the physician, officials said.
Morris Bortnick, senior vice president of the professional services division for Giant, said his stores have been making generic substitutions since the Maryland law changed a year ago.
In the absence of the "positive" formulary, which was just published and which lists drugs that have generic substitutes, the Giant pharmacies relied on the old Maryland "negative" drug list. That list cited drugs that could not be substituted by the pharmacists.
Bortnick said pharmacists now will be able to substitute about 40 fewer drugs than before, due to the list changes, without getting the approval of a physician.
The Maryland law was modeled after one recommended by the Federal Trade Commission. So far, Maryland is the only state to adopt the model.
In Virginia, generic substitutions are permitted when the physician gives permission on the prescription form. The District of Columbia allows drug substitution but chain store officials described the regulations as "cumbersome" and "vaguely defined."