Wal-Mart plans to test reduced prices for generic drugs

NEW YORK -- Wal-Mart, facing pressure from critics who call its employee health care coverage inadequate, plans to begin selling nearly 300 generic prescription drugs for a sharply reduced price of $4 for a month's supply.\nThe world's biggest retailer said Thursday that it will test the program in Florida. The program will include 291 generic drugs available for conditions from allergies to high-blood pressure and is available to its employees and customers, including those without insurance.\nWal-Mart officials said the reduced price represents a savings to the customer of up to 70 percent on some drugs.\n"Wal-Mart is taking this step so our customers and associates can get the medicines they need at a cost they can afford," Bill Simon, executive vice president of the company's professional services division, said in announcing the plan at a Tampa, Fla., store.\nThe program will be launched Friday at 65 Wal-Mart, Neighborhood Market and Sam's Club pharmacies in the Tampa Bay area and will be expanded to the entire state in January.\nSimon wouldn't be specific about why Florida, and specifically the Tampa Bay area, was chosen for the rollout of the initiative, saying only that there was a need for it here.\nThe company said it plans to expand the program to as many states as possible next year.\nSimon said the 291 generic drugs include "the most commonly prescribed drugs for the some of the most common illnesses that face Americans today, including cardiac disease, asthma, diabetes, glaucoma, Parkinson's (disease) and thyroid conditions."\nSimon wouldn't give details on how much the plan is expected to cost Wal-Mart or the company's dealings with the drug companies involved.\n"We're able to do this by using one of our greatest strengths as a company -- our business model and our ability to drive costs out of the system and the model that passes those costs savings to our customers," he said. "In this case, we're applying that business model to health care."\nThe $4 prescriptions are not available by mail order and are being offered online only if picked up in person in the Tampa Bay area.\nThe lower-priced generic drugs could put downward pressure on drug prices at other pharmacies. This has been the case with Wal-Mart's toy business.\nIn a conference call with reporters, Simon said Wal-Mart is working with drugmakers to help them be more efficient but added, "We are working with them as partners. We are not pressuring them to reduce prices."\nTampa Wal-Mart pharmacy customer Pat Sullivan praised the company's initiative. The retired Massachusetts police officer said $4 generic prescriptions are a tremendous help.\n"I'm on disability, and my benefits run out by the end of the month," he said. "It comes down to: Where do I go for a $100 prescription? I have no outlet other than to break a pill in half and take half today and half tomorrow."\nThe initiative is the fourth time since last October that Wal-Mart has moved to improve health benefits.\nWal-Mart's recent moves included relaxing eligibility requirements for its part-time employees who want health insurance and extending coverage for the first time to the children of those employees. Part-time employees, who had to work for Wal-Mart for two years to qualify, now have to work at the company for one year. This year, Wal-Mart also expanded a trial run of in-store clinics, aimed at providing lower cost non-emergency health care to the public.\nLast October, Wal-Mart offered a new lower-premium insurance aimed at getting more of its work force on company plans.\nCritics argue that Wal-Mart's coverage calls for a deductible that requires workers to pick up the first $1,000 in medical expenses, and the deductible rises to a maximum of $3,000 for families.\nUnion-backed Wake Up Wal-Mart, one of the company's most vociferous critics, have called upon Bentonville, Ark.-based Wal-Mart to offer better health care coverage and higher pay to employees.\nCritics contend that the company's benefits are too stingy, forcing taxpayers to absorb more of the cost as the workers lacking coverage turn to state-funded health care programs.\nThis past summer, Wal-Mart won a successful fight against a first-of-its-kind state law that would have required the retailer to spend more on employee health care in Maryland. A federal judge ruled in July that it was invalid under federal law. But other states are considering similar legislation aimed at the company.\nWal-Mart's shares fell 17 cents to $48.70 in morning trading on the New York Stock Exchange.