BENTONVILLE, Ark. -- It has helped to lure customers from other community pharmacies, and it has helped to boost the retailer's already high profile as a leader in health care innovation.
But most of all, the $4 generic prescription medicine program that Wal-Mart launched in September 2006 and refined last fall has saved millions of dollars for millions of customers.
Wal-Mart has positioned the program as part of its ongoing commitment to America's working families. The program is available in its discount stores, in its Neighborhood Markets and in pharmacies within its Sam's Club units.
'Each day in our pharmacies we see customers struggle with the cost of prescription drugs,' notes chief executive officer Lee Scott. 'By cutting the cost of many generics to $4, we are helping to ensure that our customers and associates get the medicines they need at a price they can afford.
'That's a real solution for our nation's working families.'
The $4 pricing is available to every pharmacy customer who has a prescription form from a physician that can be filled with a covered generic medicine. Insurance is accepted, although the initiative is also open to the uninsured.
According to Wal-Mart, the program covers hundreds of generic medications from many of the most common therapeutic categories. The medicines represented are used to treat and manage such conditions as allergies, high cholesterol, hypertension and diabetes.
Also included, notes the retailer, are some antibiotics, antidepressants, antipsychotics and prescription vitamins.
'Competition and market forces have been absent from our health care system,' points out Scott. 'We are excited about taking the lead at doing what we do best--driving costs out of the system.'
The success of the program coincides with a time in which billions of brand name drugs are facing patent expiration, a situation that paves a path for the possibility of more generic drugs eventually arriving in the American marketplace.
The introduction of the second phase of the generic prescription drug program last fall was again carried out with the customer in mind, maintains John Agwunobi, senior vice president of health and wellness.
'We tried as best we could to add those drugs that we felt were most in demand by our customers,' he explains, adding that when the retailer's own costs prohibited a $4 offering it was still able to offer customers drugs at a slightly higher but still attractive price point.
'We're going to continue [these types of cost-saving initiatives],' pledges Agwunobi. 'We're always working on it; we're looking at ways to expand the program, to have it designed by customer needs and customer demands.
'So if we find that customers are calling for a particular group of drugs to be added to the list, we'll find ways over time to try to do so.'
Although the program focuses on generics, Agwunobi points out that it has had a positive impact on the retailer's over all business. 'We've done very well in branded prescription products over this period, so we're very pleased with that,' he says.
'When all is said and done, it's about listening to the customer--not just hearing what the customer wants. The difference is we have to be willing to customize our offerings; we have to be willing to get a sense of not just where the customers are today but where they are going to be in the future.'
And that objective of predicting the customer of the future, note Wal-Mart officials, might be more critical in health care than in any other segment.
Wal-Mart's $4 generic drug program reflects a trend in both the private sector and the public arena to encourage patients (when feasible) to use such medications, which are considerably less expensive than their brand name counterparts.
Because of rising prescription drug costs, health plans have implemented multitier co-pay programs to make generic drugs more economically attractive and, in some instances, have waived co-pays for generics.
