Yes, Virginia, PBMs Really Do Suck

Oct 25, 2021

Like many community pharmacies, Newman Family Pharmacy is the kind of pharmacy patients choose for its incomparable commitment to service and care. A smaller pharmacy located in the heart of Chesapeake — Virginia’s working class and military family neighborhoods — Newman Family Pharmacy was set up to serve the very community in which its proprietor, pharmacist Michael Scott Newman, grew up. The high school from which he graduated is almost literally down the street from his pharmacy.

A long-time successful pharmacist with Rite Aid, Scott said he knew going into business for himself would be challenging. “Really my goal was simply to pay the mortgage and maintain the standard of living we’d obtained on my salary at Rite Aid,” he says with a laugh. But he was confident; he knew the skills he’d honed and used to consistently build Rite Aid’s pharmacy business would serve him in his new store. And so, in March of 2013, Scott Newman opened Newman Family Pharmacy.

The first four years were good; in the fourth year, Newman Family Pharmacy began to turn a modest profit (“when I could stop checking my bank account every day because it was no longer running in the red” Scott says). In September of 2017, the pharmacy took a downturn — you may remember the 3rd and 4th quarters of 2017 were when CVS began drastically cutting reimbursements then sending follow-up “wouldn’t you like to sell?” letters. So, like many community pharmacies, Newman Family Pharmacy was growing, but the more patients Scott took on, the more money the pharmacy lost … and the cycle never stopped.

You may know the end of this story. On Wednesday, October 13, 2021, Newman Family Pharmacy closed its doors for the last time.

Here at PUTT, when a pharmacy closes it feels like losing a good friend. In the case of Newman Family Pharmacy, which belonged to PUTT President Scott Newman, it’s like the death of a family member. The closure of Scott’s pharmacy marks the 3rd such “death in the family” in less than a year. Two other PUTT Board members were forced to make similar decisions. There simply aren’t words to describe the gut-punch that comes with the death of a business over circumstances and practices the business owner, by contract, cannot control.

There is no shame in the closure of a pharmacy. But, there is enormous shame in trying to pretend pharmacy closures aren’t happening — that the independent pharmacy industry is well and thriving, not to mention expanding! — which is why the latest installment of PCMA’s gaslighting campaign to prove pharmacies aren’t closing is so infuriating.

Titled some version of “Gosh, we’re really just trying to understand why NCPA and NCPDP’s data don’t line up”, PCMA’s latest white paper is 10 pages of explanation about data, methodology, and a Penn State professor/author’s commentary on why anyone who questioned his first report is basically wrong. It’s followed by an unambiguous message that NCPDP is the gold standard for data and NCPA data is somehow flawed and shouldn’t be used.

NCPA will surely defend the data it publishes in its annual digest. But it’s important to remember that pharmacy closures are one very big symptom of a much larger problem, one that underlies the tenets of a capitalist economy and free-market system, and touches every single person living in the U.S. whether or not they take medicine, pay taxes or buy insurance. And until we drag that problem — the opacity and greed of a few extremely large insurance and PBM middlemen — into the light and compel transparency, the sickening cycle of pharmacy openings and closures will continue.

For now, we know NCPDP data is definitely not the gold standard. But we would appreciate hearing from you about your experiences with NCPDP. If your NCPDP pharmacy data is still not correct, please contact us. We can’t undo the release of PCMA’s latest “research” but we can provide real evidence that at least calls the validity of their so-called “research” into question.

Keep fighting, and as always, thank you for your support of PUTT!

Monique Whitney
Executive Director