Channel trends in IMS Institute annual data show continued growth of chain drugstores

May 3, 2011
Pharmaceutical Commerce, Pharmaceutical Commerce - May/June 2011,

Chains now handle 54.4% of prescriptions; mail order flat at 6.6%

The “Use of Medicines in the United States” report from the IMS Institute for Healthcare Informatics (see item below) provides a detailed look at where prescriptions are filled, and money spent, by consumers. The overall trends vary only slightly from the year before, but show a continuation of prescriptions being filled at chain drugstores over independents, and flattening of spending and prescription-filling at mail order providers.

The overall market was worth $307.4B in 2010. Of that $108.1B, or 35.2%, was spent at chain drugstores, up a hair from 35.1% in 2009. Spending at independent drugstores was $37.9B, 12.3% of the total, but down from 2009’s 12.4%. Mail service garnered $52.6B of spending, or 17.1%, the same percentage it saw in 2009. There had been a slow growth trend in mail service going back several years, but that appears to be cresting. (Pharmaceutical Commerce Editorial Board member Adam Fein points out that retail revenue figures do not include retailers' markups of drug costs, so they are more properly characterized as retailer purchase costs rather than spending.)

Spending at clinics and non-federal hospitals, the other two large channel categories, increased slightly, with clinics ($36.2B in 2010) representing 11.8% of drug spend, up from 11.6% the year before, while hospitals ($28.0B) came in at 9.1%, down from 9.2% the year before.

Dispensing trends

There were 3.995.2 billion prescriptions filled in 2010, according to the IMS Institute, up 1.2% from 2009. Chains increased their share of this statistic as well, representing 54.4% of dispensing locations, while independents dropped from 19.1% in 2009 to 18.7%. Meanwhile, mail service was unchanged, at 6.6% for both 2009 and 2010. Even so, those statistics show that while chains fill more than half of prescriptions to garner a third of the spending, mail service fills one out of 15 prescriptions but garners one out of six drug-spend dollars. At independents, the proportional ratio between prescriptions filled and revenue generated is almost one-for-one.