Why we should all own stocks in Shoppers Drug Mart

We all use a pharmacy for prescriptions. Some use Shoppers Drug Mart, some use Pharma Plus, and some even use the Costco pharmacy. No matter which one you use, we all inevitably need to fill a prescription for someone in our family.

Last week I filled out a prescription that I fill out every two months. I won’t go into detail or name but the prescription is for a powder mix that comes pre-packaged. There are 30 individually packages in one small box. Basically I order the prescription and the pharmacist prints out a label and slaps it on the box. Nice and simple. I am covered under a health plan so I pay for the prescription, send in the receipts and receive reimbursement two weeks later.

Now, I actually took a minute last week to examine the receipt from the pharmacy (Shoppers Drug Mart) and saw a fee of $11.99. This is the dispensing fee that is charged by all pharmacies in Ontario. These fees range from the low end $4.11 at Costco to $13.49 at Guardian Drugs. What is the dispensing fee? It is a fee pharmacies charge for each prescription filled. According to the Ontario Pharmacists Association “It is known as a professional fee, because it applies to the service of the pharmacist in caring for your medication profile”.

Now each company has different fees because it has different costs. Shoppers Drug Mart is predominantly a pharmacy and health supply provider so their fees are used to cover their costs of operations. A location such as Costco or Loblaws use their pharmacy as an added service and thus can offer lower fees since they have income from other sources.

Here is a rundown of some locations and fees

Now I don’t begrudge the work done by a pharmacist or the company that dispenses these drugs, but I’d be quite upset if I was paying for these out of pocket knowing that Shoppers Drug Mart receives $11.99 for just slapping a sticker on a box. According to the Ontario Pharmacists Association website, the fees are constant for each prescription that is dispensed because the responsibility and professional care provided by the pharmacist are the same whatever the cost of the treatment.  For those that don’t have a drug plan covering all your prescription costs, it may be time to examine where you get your prescriptions from. Drug costs are expensive enough without having to pay these additional costs for dispensing.

For the rest of us, with an aging population that will always be reliant on prescription medication, it may be time to invest in some pharmacy stocks given the baby boomers’ ever increasing need for meds and healthcare.