The 2016 Economic Report on Retail, Mail, and Specialty Pharmacies

by Adam J. Fein, Ph.D.
(downloadable PDF file; released January 2016)

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In 2015, amid significant growth, the $364 billion pharmacy industry began to fundamentally transform its structure. The implementation of healthcare reform is reshaping drug benefits, but remains politically contentious. Specialty drugs and specialty pharmacies are booming, as the generic dispensing rate plateaus. Meanwhile, major mergers and acquisitions among pharmacies, health plans, and PBMs will leave the industry more consolidated than ever before. Given these and other changes, understanding the implications of the industry’s evolution is crucial.

The 2016 Economic Report on Retail, Mail, and Specialty Pharmacies—our seventh edition—remains the most up-to-date, comprehensive, fact-based analysis of the pharmacy channel and its interactions with other participants in our healthcare system. The report was researched and written by Adam J. Fein, Ph.D., one of the world’s leading experts on the industry and author of the influential Drug Channels website. It synthesizes a wealth of statistical data, research studies, financial information, and his unique business consulting experience into a definitive, nonpartisan resource.

The report is your ultimate guide to the complex web of interactions within the pharmacy distribution and reimbursement system. It helps pharmaceutical manufacturers, wholesalers, pharmacists, pharmacy owners, benefit managers, managed care executives, healthcare policy analysts, investors, consultants—anyone who wants to understand and benefit from this ever-changing industry.

To better reflect the changing industry, this year’s edition has been completely updated, reorganized and expanded. The 2016 Economic Report on Retail, Mail, and Specialty Pharmacies analyzes the industry in 10 chapters, organized into three major sections.

  • The first three chapters examine the U.S. pharmacy industry’s current structure, distinguish among the different dispensing formats for prescription pharmaceuticals, and identify the largest participants. We also examine pharmacy markets for specialty drugs.
  • The two other major sections of The 2016 Economic Report on Retail, Mail, and Specialty Pharmacies explain and analyze the key channel flows in the U.S. pharmacy distribution and reimbursement system for patient-administered, outpatient brand-name drugs. The numbers in the chart below indicate the report chapter that explains and analyzes each channel flow.

The chapters are self-contained and do not need to be read in order. We include extensive internal references to help you navigate the entire document and customize it to your specific needs. (These references are clickable hyperlinks in the PDF document.) There are also nearly 400 endnotes, most of which have hyperlinks to original source materials.

Please note that purchase of The 2016 Economic Report on Retail, Mail, and Specialty Pharmacies indicates agreement with the terms and conditions of the End User License Agreement (EULA). License terms, purchaser’s name/email, and a unique transaction ID will be added to the secure PDF file upon checkout. You must purchase a Department/Team or Corporate License if you want to share the report with other people in your company. Upon request, we will refund duplicate purchases of a Corporate License from the same organization.

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The 2016 Economic Report on Retail, Mail, and Specialty Pharmacies is protected by copyright law. Unauthorized reproduction or distribution of this report, or any portion of it, may result in severe civil and criminal penalties, and will be prosecuted to the maximum extent of the law. This report may be cited in commercial documents with full and appropriate attribution. Nothing in this license is intended to reduce, limit, or restrict any rights arising from fair use under copyright law or other applicable laws.

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TABLE OF CONTENTS

Introduction and Guide to This Report

SECTION I: THE U.S. PHARMACY INDUSTRY

Chapter 1: Industry Overview

  • 1.1. Defining the Practice of Pharmacy
    • 1.1.1. The Products That Pharmacies Dispense
    • 1.1.2. Top Traditional Therapy Classes and Average Prescription Costs
    • 1.1.3. Pharmacies and the Drug Supply Chain Security Act
  • 1.2. Pharmacy Industry Participants
    • 1.2.1. Outpatient Pharmacy Dispensing Formats
    • 1.2.2. Differences Among Outpatient Dispensing Formats
    • 1.2.3. Pharmacist Employment and Salaries
  • 1.3. Pharmacy Industry Trends and Report Overview

Chapter 2: Pharmacy Industry Market Structure

  • 2.1. Industry Trends
    • 2.1.1. Total and 30-Day Equivalent Prescriptions
    • 2.1.2. Pharmacy Industry Revenues
  • 2.2. National Market Share by Company
  • 2.3. Trends by Dispensing Format
    • 2.3.1. Revenues, Prescriptions, and Number of Pharmacies: 2010 to 2015 Trends
    • 2.3.2. Market Changes in 2015
    • 2.3.3. National Retail Chains
    • 2.3.4. Regional Drugstore Chains
    • 2.3.5. Independent Pharmacies
    • 2.3.6. Mail Pharmacies
  • 2.4. Compensation for Healthcare Services
    • 2.4.1. Retail Clinics
    • 2.4.2. Clinical Services and Medication Therapy Management (MTM)
    • 2.4.3. Immunization

Chapter 3: Specialty Drugs and Specialty Pharmacies

  • 3.1. Specialty Drugs
    • 3.1.1. Common Characteristics of Specialty Drugs
    • 3.1.2. How Payers Define Specialty Drugs
    • 3.1.3. Top Specialty Therapy Classes and Average Prescription Costs
    • 3.1.4. Specialty’s Share of Pharmacy Benefit Spending
  • 3.2. Specialty Pharmacies
    • 3.2.1. Defining Specialty Pharmacy
    • 3.2.2. Clinical and Data Services
    • 3.2.3. Accreditation
    • 3.2.4. Number of Specialty Pharmacies
  • 3.3. Specialty Market Participants
    • 3.3.1. Overview
    • 3.3.2. Pharmacy Benefits Managers
    • 3.3.3. Independent Specialty Pharmacies
    • 3.3.4. Retail Chains
    • 3.3.5. Hospitals and Physicians
    • 3.3.6. Physician Practices
    • 3.3.7. Wholesalers
  • 3.4. National Market Share for Specialty Pharmaceuticals
  • 3.5. Mergers and Acquisitions Among Specialty Pharmacies
  • 3.6. Manufacturer Channel Strategies for Specialty Drugs
    • 3.6.1. Manufacturer-Defined Dispensing Networks
    • 3.6.2. Specialty Hub Services
  • 3.7. The Outlook for Pharmacy-Dispensed Biosimilars

SECTION II: THIRD-PARTY PAYMENT AND PHARMACY BENEFITS

Chapter 4: Payment and Spending for Prescription Drugs

  • 4.1. Prescription Drugs and U.S. Healthcare Spending
  • 4.2. Recent Payer and Spending Trends
    • 4.2.1. Payment for Prescription Drugs in 2014
    • 4.2.2. Net Drug Spending in 2014: Payer Trends
    • 4.2.3. Gross Drug Spending in 2014: Traditional vs. Specialty
  • 4.3. The Drug Spending Outlook
    • 4.3.1. The Specialty Boom and the Generic Plateau
    • 4.3.2. Net Drug Spending Projections to 2024
    • 4.3.3. Gross Drug Spending Projections: Traditional vs. Specialty
    • 4.3.4. Payment for U.S Outpatient Prescription Drugs in 2024

Chapter 5: Pharmacy Benefit Management

  • 5.1. PBM Industry Structure
  • 5.2. Relationships Between PBMs and Plan Sponsors
    • 5.2.1. PBM Services for Plan Sponsors
    • 5.2.2. Formulary Development and Management
    • 5.2.3. Utilization Management Services by PBMs
  • 5.3. Rebate Negotiations with Manufacturers
    • 5.3.1. Manufacturer Rebates
    • 5.3.2. Formulary Exclusions
    • 5.3.3. How Rebates Affect Third-Party Payers
  • 5.4. Relationships Between PBMs and Pharmacies
    • 5.4.1. Retail Pharmacy Participation in PBM Networks
    • 5.4.2. PBM-Pharmacy Negotiations
    • 5.4.3. Smaller Pharmacies and Pharmacy Services Administration Organizations
  • 5.5. PBM Compensation by Plan Sponsors
    • 5.5.1. Spread Pricing
    • 5.5.2. Pass-Through Pricing

Chapter 6: Consumer Copayments and Coinsurance

  • 6.1. Employer-Sponsored Health Plans
  • 6.2. Health Insurance Marketplace Plans
  • 6.3. Medicare Part D
  • 6.4. Medicaid
  • 6.5. Prescription Drug Deductibles
  • 6.6. Manufacturer Copayment Offset Programs

Chapter 7: Narrow Pharmacy Networks

  • 7.1. Overview of Pharmacy Benefit Network Models
    • 7.1.1. Network Options
    • 7.1.2. The Appeal of Narrow Networks
  • 7.2. Retail Pharmacy Networks
    • 7.2.1. Preferred Retail Networks in Medicare Part D
    • 7.2.2. Narrow Retail Networks in Commercial Health Plans
    • 7.2.3. Narrow Mail Networks in Commercial and Other Health Plans
    • 7.2.4. Pharmacy Profits as the Source of Cost Savings in Narrow Retail Networks
  • 7.3. The Emergence of Performance-Based Pharmacy Networks
  • 7.4. Payer-Defined Specialty Dispensing Networks

SECTION III: DRUG CHANNEL ECONOMICS

Chapter 8: Prescription Reimbursement by Third-Party Payers

  • 8.1. The Basics of Prescription Reimbursement
    • 8.1.1. Reimbursement Methodologies for Estimating Acquisition Costs
    • 8.1.2. Dispensing Fees
    • 8.1.3. Service and Data Fees
  • 8.2. Reimbursement for Brand-Name and Specialty Prescriptions
    • 8.2.1. Wholesale Acquisition Cost (WAC) and Average Wholesale Price (AWP) List Prices
    • 8.2.2. Why List Prices Are Used for Brand-Name Prescription Reimbursement
    • 8.2.3. Average AWP Discounts for Pharmacy Reimbursement
    • 8.2.4. Retail vs. Mail Reimbursement Rates for Brand-Name Drugs
    • 8.2.5. Why Mail Pharmacies Accept Lower Reimbursements
  • 8.3. Reimbursement for Generic Prescriptions
    • 8.3.1. Challenges for List-Price Benchmarks
    • 8.3.2. Maximum Allowable Cost (MAC) Limits
    • 8.3.3. Regulation and Laws Regarding MAC Limits
    • 8.3.4. Medicaid and Federal Upper Limits
  • 8.4. Acquisition Cost Reimbursement
    • 8.4.1. The AAC and NADAC Benchmarks
    • 8.4.2. Adoption of Acquisition Cost by State Medicaid Programs
  • 8.5. Manufacturer Sales Price Methods
    • 8.5.1. Medicaid and AMP-Based Federal Upper Limits
    • 8.5.2. Average Sales Price (ASP)
  • 8.6. How Prescription Reimbursement, Formulary Rebates, Consumer Copayments, and PBM Expenses Affect Plan Sponsor Costs

Chapter 9: Relationships with Pharmaceutical Wholesalers

  • 9.1. Wholesale Suppliers to Pharmacies
    • 9.1.1. Largest Companies
    • 9.1.2. Full-Line Wholesalers
    • 9.1.3. Specialty Distributors
  • 9.2. Wholesalers’ Channel Role for Pharmacies
    • 9.2.1. Physical Distribution
    • 9.2.2. Financial Intermediation
    • 9.2.3. Cost-Minus Pricing of Brand-Name Drugs to Pharmacies
    • 9.2.4. Influence on Pharmacy Reimbursement
  • 9.3. Relationships with Independent Drugstores
    • 9.3.1. Wholesaler Services for Independent Pharmacies
    • 9.3.2. Wholesaler Relationships with Pharmacy Buying Groups
    • 9.3.3. Wholesaler Generic Programs for Retail Pharmacies
  • 9.4. Large Retail Chains and Mail Pharmacies
    • 9.4.1. Wholesale Suppliers to Largest U.S. Pharmacies
    • 9.4.2. Changing Distribution Relationships Between Wholesalers and Retail Chains
    • 9.4.3. Changing Generic Sourcing Relationships Between Wholesalers and Large Pharmacies
  • 9.5. Wholesaler Relationships with Three Largest Drugstore Chains
    • 9.5.1. Walgreens-AmerisourceBergen Relationship
    • 9.5.2. CVS Health-Cardinal Health Relationship
    • 9.5.3. Rite Aid-McKesson Relationship
  • 9.6. Wholesalers’ Role in Pharmacy-Dispensed Specialty Drug Distribution
    • 9.6.1. Specialty Products with Limited Pharmacy Networks
    • 9.6.2. Specialty Products in Open Distribution

Chapter 10: Pharmacy and Prescription Profitability

  • 10.1. Overall Drugstore Gross Margins
    • 10.1.1. Industry Averages
    • 10.1.2. Large Chain Drugstores
  • 10.2. Pharmacy Per-Prescription Profits
    • 10.2.1. Sources of Per-Prescription Profits
    • 10.2.2. Average Prescription Gross Margins
    • 10.2.3. PBM Per-Prescription Profits from Network and Mail Pharmacies
    • 10.2.4. Pharmacy Profits With Acquisition Cost-Based Reimbursement
  • 10.3. Profitability for Generic Prescriptions
    • 10.3.1. Lifecycle Profits for Generic Drugs
    • 10.3.2. Retail Generic Drug Discount Programs
    • 10.3.3. The Impact of Generic Price Inflation
  • 10.4. Pharmacy Profits from the 340B Drug Pricing Program
    • 10.4.1. Overview of the 340B Program
    • 10.4.2. The Role and Identity of 340B Contract Pharmacies
    • 10.4.3. Flow of Funds with a Contract Pharmacy
    • 10.4.4. Pharmacy and Covered Entity Profits from 340B Prescriptions

Acronyms and Abbreviations

Endnotes

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LIST OF EXHIBITS

Exhibit 1: Top 10 Traditional Therapy Categories and Average Prescription Cost, 2014
Exhibit 2: Timeline of DSCSA Requirements for Pharmacies (Dispensers)
Exhibit 3: Average Annual Number of Prescriptions per Pharmacy, by Retail Dispensing Format, 2015
Exhibit 4: Average Annual Prescription Revenue per Pharmacy Outlet, 2015
Exhibit 5: Average Wait Time for Prescription Pickup and Pharmacist Consultation, by Dispensing Format, 2014
Exhibit 6: Customer Satisfaction with Pharmacies, by Dispensing Format, 2015
Exhibit 7: Top Three Reasons for Pharmacy Selection, by Dispensing Format, 2014
Exhibit 8: Pharmacist Employment and Salary, by Dispensing Format, 2014
Exhibit 9: Pharmacist Employment, by Dispensing Format, 2014 vs. 2024
Exhibit 10: Total U.S. Pharmacy Industry Revenues, Prescriptions, and Locations, by Dispensing Format, 2015
Exhibit 11: Outpatient Prescriptions, Annual Total and Growth, 2010-2015E
Exhibit 12: 30-Day Equivalent Outpatient Prescriptions, Annual Total and Growth, 2010-2015E
Exhibit 13: 90-Day Prescriptions as a Percentage of Total Prescriptions, by Dispensing Format, 2010 vs. 2015E
Exhibit 14: Pharmacy Industry Revenues, Annual Total and Growth, 2010-2015E
Exhibit 15: Largest 15 U.S. Pharmacies Ranked by Total Prescription Revenues, 2015
Exhibit 16: Share of Revenue Growth, by Dispensing Pharmacy Format, 2010 vs. 2015E
Exhibit 17: Total Change in 30-Day Equivalent Prescriptions Dispensed, by Pharmacy Format, 2010-2015E
Exhibit 18: Number of Pharmacies, by Dispensing Format, 2010 vs. 2015
Exhibit 19: Number of 30-Day Equivalent Prescriptions, by Dispensing Format, 2014 vs. 2015E
Exhibit 20: Prescription Revenues, by Dispensing Format, 2014 vs. 2015E
Exhibit 21: Year-Over-Year Change in Same-Store Prescription Count, 2012-2015
Exhibit 22: Top 10 Regional Chain Drugstores, by Total Prescription Revenues, 2014
Exhibit 23: Number of Independent Pharmacies, 1990-2015
Exhibit 24: Mail Prescriptions, Annual Total and Growth, 2003-2015E
Exhibit 25: Share of Mail Pharmacy Revenues, by Company, 2015
Exhibit 26: Number of U.S. Retail Clinics, 2004-2017
Exhibit 27: Location of Retail Clinics, by Chain, 2015
Exhibit 28: Providers of Medication Therapy Management Services, Medicare Part D, 2015
Exhibit 29: Adult Influenza Vaccination, by Place of Vaccination, 2012-13 vs. 2015-16 Seasons
Exhibit 30: Factors Determining Health Plan Classification as Specialty Therapy, 2011 vs. 2014
Exhibit 31: Top 10 Specialty Therapy Categories and Average Prescription Cost, 2014
Exhibit 32: Specialty Drug Approvals, 2005 to 2015
Exhibit 33: Specialty Drugs as a Percentage of Pharmacy Benefit Spending, by PBM, 2011-2014
Exhibit 34: Number of Pharmacy Locations with Specialty Pharmacy Accreditation, URAC vs. ACHC, January 2016
Exhibit 35: Locations with URAC Specialty Pharmacy Accreditation, 2008-2016
Exhibit 36: Examples of Pharmacies Dispensing Specialty Pharmaceuticals
Exhibit 37: Pharmacy Locations with Specialty Pharmacy Accreditation, by Corporate Ownership, January 2016
Exhibit 38: Fastest-Growing Private Specialty Pharmacies, 2014
Exhibit 39: Acquisitions of Specialty Pharmacies by Retail Chains, 2012-2015
Exhibit 40: Oncology Volume, by Dispensing Channel, 2015
Exhibit 41: Pharmacy Revenues and Market Share from Specialty Pharmaceuticals, by Company, 2015
Exhibit 42: Leading Specialty Hub Services Providers, 2015
Exhibit 43: Summary of Flows in the U.S. Distribution and Reimbursement System
Exhibit 44: Share of U.S. National Health Expenditures, by Major Spending Category, 1974-2024
Exhibit 45: Source of Payment for Outpatient Prescription Drug Expenditures, 2014
Exhibit 46: Outpatient Prescription Drugs as Share of U.S. National Health Expenditures, by Payer, 2014
Exhibit 47: Change in Net Spending for Outpatient Prescription Drugs, by Payer, 2013 vs. 2014
Exhibit 48: Consumers’ Out-of-Pocket Spending Share of Outpatient Prescription Drug Expenditures, 1973-2014
Exhibit 49: Change in Gross Drug Spending, Traditional vs. Specialty Drugs, by PBM, 2014
Exhibit 50: Change in Gross Pharmacy Benefit Drug Spending, Traditional vs. Specialty Drugs, 2002 to 2014
Exhibit 51: Generics, Share of U.S. Prescriptions, 2003-2019
Exhibit 52: Top 10 U.S. Drugs, 2014 Actual vs. 2020 Forecast
Exhibit 53: Pharmacy Industry Revenues, Traditional vs. Specialty Drugs, 2010-2020
Exhibit 54: Projected Growth Rates in National Health and Outpatient Prescription Drug Expenditures, 2012-2024
Exhibit 55: Median Prescription Expenses per Person, by Age, 2013
Exhibit 56: Forecast Change in Gross Drug Spending, Traditional vs. Specialty Drugs, by PBM, 2015-2017
Exhibit 57: Source of Payment for Outpatient Prescription Drug Expenditures, 2024
Exhibit 58: Total Expenditures for Outpatient Prescription Drugs, by Payer, 2024
Exhibit 59: PBM Market Share, by Total Prescription Claims, 2015
Exhibit 60: Common Pharmacy Benefit Plan Designs
Exhibit 61: Prevalence of Utilization Management Tools to Manage Specialty Drug Costs, by Employer Size, 2015
Exhibit 62: Rebates and Discounts as a Percentage of Pharmaceutical Manufacturers’ Brand-Name Gross Sales, 2007 to 2014
Exhibit 63: Price Increases for Brand-Name Drugs, Invoice vs. Net Price Growth, 2010-2014
Exhibit 64: Number of Products on PBM Formulary Exclusion Lists, 2012-2016
Exhibit 65: Formulary Exclusions for Specialty Drugs, Medicare Part D, 2016
Exhibit 66: PBM Rebate Arrangements for Traditional Brand Medications, Employer-Sponsored Plans, 2015
Exhibit 67: Government Programs, Average Rebates as Percentage of Retail Drug Price
Exhibit 68: Largest Pharmacy Services Administration Organizations, by Members and Ownership, 2015
Exhibit 69: Key Components of PBM Compensation
Exhibit 70: PBM Compensation Approach, by Employer Size, 2015
Exhibit 71: Distribution of Cost-Sharing Formulas for Prescription Drug Benefits in Employer-Sponsored Plans, 2005 vs. 2015
Exhibit 72: Average Copayments by Prescription Drug Tier, Employer-Sponsored Plans, 2005 vs. 2015
Exhibit 73: Cost-Sharing Arrangements for Prescription Drug Benefits in Employer-Sponsored Plans, 2015
Exhibit 74: Average Copayments by Prescription Drug Tier, Bronze vs. Platinum Health Insurance Marketplace Plans, 2015
Exhibit 75: Type of Cost-Sharing for Prescription Drug Benefits, Health Insurance Marketplace Plans, Platinum Plans, 2016
Exhibit 76: Type of Cost-Sharing for Prescription Drug Benefits, Health Insurance Marketplace Plans, Bronze Plans, 2016
Exhibit 77: Standard Medicare Prescription Drug Benefit, 2016
Exhibit 78: Median Copayments by Prescription Drug Tier, Medicare Part D Plans, 2015
Exhibit 79: Type of Cost-Sharing for Prescription Drug Benefits, Medicare Part D Prescription Drug Plans, 2015
Exhibit 80: Percentage of Employer-Sponsored Plans with Pharmacy Benefit Deductibles, 2012 to 2015
Exhibit 81: Percentage of Health Insurance Marketplace Plans with Separate Prescription Drug Deductible, 2016
Exhibit 82: Sources of Free Trial Vouchers, Coupons, and Copay Cards, 2014
Exhibit 83: Summary of Pharmacy Benefit Network Design Options
Exhibit 84: Medicare Part D PDPs with Preferred Pharmacy Networks, 2011-2016
Exhibit 85: Participation as Preferred Cost Sharing Pharmacies in Selected Medicare Part D PDPs, Retail Chain and Independent Pharmacies, 2016
Exhibit 86: Retail Pharmacy Network Design in Employer-Sponsored Plans, 2015
Exhibit 87: CVS Health, Maintenance Choice Covered Lives and Caremark Retail Channel Share, 2009 to 2015
Exhibit 88: Mail Pharmacy Network Design in Employer-Sponsored Plans, Maintenance Medications, 2015
Exhibit 89: DIR Fees for Medicare Part D Preferred Cost-Sharing Pharmacies, 2015
Exhibit 90: Share of Hepatitis C Virus (HCV) Drug Expenditures, by Dispensing Format, 2014
Exhibit 91: Payer-Mandated Usage of Specialty Pharmacies for Oncology Products, by Product Type, 2010-2014
Exhibit 92: Payer Methodologies for Computing a Pharmacy’s Estimated Acquisition Cost (EAC)
Exhibit 93: Average Dispensing Fee for Brand-Name Prescriptions at Retail Pharmacies, 1999 to 2015
Exhibit 94: Methodology Used to Compute Average Wholesale Price, by Publisher
Exhibit 95: Reimbursement of Brand-Name Prescriptions, Percentage of Average Wholesale Price, by Dispensing Format, 2015
Exhibit 96: Reimbursement of Specialty Drug Prescriptions at Specialty Pharmacies, Percentage of Average Wholesale Price, 2004 to 2014
Exhibit 97: Percentage of AWP Billed to Employers for Brand-Name Prescriptions, Retail vs. Mail, 1999 to 2015
Exhibit 98: Generic Drugs, Comparison of Per-Unit Pricing Metrics and Pharmacy Acquisition Cost, Medicaid
Exhibit 99: Reimbursement of Generic Prescriptions, Percentage of Average Wholesale Price and Copayment, by Dispensing Format, 2015
Exhibit 100: Acquisition Cost Methodologies for Pharmacy Reimbursement Used by State Medicaid Programs, 2015
Exhibit 101: Example of Brand-Name Prescription Economics for a Third-Party Payer
Exhibit 102: U.S. Drug Distribution and Related Revenues at Big Three Wholesalers, 2015
Exhibit 103: Full-Line Wholesaler Sales, by Type of Customer, 2014
Exhibit 104: Full-Line Wholesalers, Inventory Levels vs. Product Sales, by Product Type, 2014
Exhibit 105: Determination of a Pharmacy’s Brand-Name Drug Acquisition Cost from a Wholesaler
Exhibit 106: Estimated Market Share with Independent Pharmacies, by Wholesaler, 2014
Exhibit 107: U.S. Pharmacy Franchise and Marketing Programs of Large Drug Wholesalers, 2014
Exhibit 108: Pharmacy Buying Groups and Primary/Preferred Wholesaler Relationship, 2015
Exhibit 109: Largest U.S. Pharmacies and Their Primary Wholesale Suppliers
Exhibit 110: Full-Line Wholesaler Sales to Retail Chain Warehouses, 2008 to 2014
Exhibit 111: Share of U.S. Generic Purchasing Volume, by Organization, 2015
Exhibit 112: Cardinal Health, Revenues from CVS Health and Walgreens, 2011-2015
Exhibit 113: Rite Aid, Total Inventories and Days Sales in Inventory, 2013 to 2015
Exhibit 114: Alternative Channels to Specialty Pharmacies in Limited Networks
Exhibit 115: Overall Gross Margins for Chain and Independent Drugstores, 1993-2013
Exhibit 116: Total Gross Profits for Chain and Independent Drugstores, 2003-2013
Exhibit 117: Overall Gross Margins for Drugstores, by Company, 2014
Exhibit 118: Example of Brand-Name Prescription Economics for a Pharmacy
Exhibit 119: Average Prescription Gross Margins at Independent Drugstores, 2006-2014
Exhibit 120: Diplomat Pharmacy, Per-Prescription Revenues and Profits, 2011-2015
Exhibit 121: Average Retail Pharmacy Gross Margin per Prescription, Brand-Name vs. Generic Drugs, 2012
Exhibit 122: PBM Gross Margin per Equivalent Script, by Channel and Drug Type, 2015
Exhibit 123: Lifecycle of Per-Prescription Gross Profits, Brand vs. Multisource Generic
Exhibit 124: Incremental Pharmacy Gross Profits from Newly Launched Generics, 2011-2016
Exhibit 125: Examples of Pharmacy Acquisition Cost, Brand-Name vs. Generic Drug, 2015
Exhibit 126: Number of Products on Retail Generic Discount Lists, by Retail Chain, 2012 vs. 2015
Exhibit 127: 340B Contract Pharmacy Locations, by Chain, 2015
Exhibit 128: Flow of Funds and Product for 340B Contract Pharmacy Network
Exhibit 129: Hypothetical Profits for a 340B Entity From a Third-Party Prescription Dispensed by a 340B Contract Pharmacy

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