The changing veterinary drug model
There are forces chipping away at the once-exclusive veterinary drug channel. With FidoPharm's recent announcement that it is unveiling a prescription-only generic heartworm medication available (at least initially) only through Walmart pharmacies, some say it's the next step in a fast-changing veterinary drug distribution model.
Well-known consultant, veterinarian and national author and speaker Dr. James F. Wilson of Priority Veterinary Management Consultants explains, "This is just another part of the ongoing commoditization of veterinary medicine." This commoditization is being driven in part by a bad economy and is exacerbated by what consumers and the emerging pet pharmacy competition now believe are unreasonable drug markups by veterinarians, Wilson says. What's missing from the equation is a realization that veterinarians have done this over the years to generate profits from these products in order to subsidize their costs to deliver optimal, but all too often seriously underpriced, professional services, he says.
According to Dr. Michael Paul of Magpie Consulting and former president of the American Animal Hospital Association (AAHA), big-box retailers have been experimenting with the model of offering prescription pet medications through pharmacies.If consumers are basing their decision to purchase medications strictly on price, the trend may grow in popularity, Paul says. "My concern is our profession has gone along for years using this model," he says. "Equine practitioners lost their pharmacy revenue years ago. It is now catching up with companion animal medicine. There are challenges. Veterinarians will have to come up with more creative ways to draw clients into their practices. We are going to have to rely on information and education."
When it comes to product sales, convenience offers veterinarians a competitive edge, but they will have to compete on price with big-box retailers if they choose to run a full pharmacy within the practice.
In Washington, the debate among lawmakers may only intensify. Despite lobbying by the American Veterinary Medical Association (AVMA) and other national veterinary organizations, along with unified opposition by all 50 state veterinary medical associations, the Fairness to Pet Owners Act, HR 1406, is expected to move forward.
Introduced in April 2011, the bill has been in committee discussions ever since, but Dr. Doug Mader, past president of the North American Veterinary Conference (NAVC), says it's only a matter of time before the proposal becomes reality. Mader helped organize a panel discussion between veterinarians and PetMeds Express in January over the company's drug distribution and marketing tactics. He says that after some of the language in the bill has been tweaked, passage is imminent and "veterinarians need to look at the writing on the wall."
The bill would require veterinarians to write a prescription whether or not they will dispense the product, provide a written disclosure notifying clients that they may fill prescriptions at the veterinary clinic or at an off-site pharmacy, and verify a prescription electronically or by other means consistent with applicable state law. Under the bill, veterinarians may not require a client to purchase an animal drug from them, charge the client a fee for writing a prescription or require the client to sign any waiver of liability disclaimer should the prescription be inaccurately filled by an off-site pharmacy.
AVMA has argued that it already has a long-standing policy encouraging veterinarians to write prescriptions for clients upon request and that the law would create unnecessary regulatory and administrative burdens on practices.
A letter sent to federal lawmakers in January by AVMA, AAHA, all 50 state VMAs and other national veterinary groups argues that veterinary medicine already supports a client's choice to fill a prescription off-site.
"At the same time, veterinary medicine strongly opposes a federal mandate to provide a written prescription each time a product is prescribed, regardless of whether a client wants to go elsewhere. ... And state laws already govern veterinary prescription writing. In fact, multiple states have laws requiring a veterinarian to honor a client's request for a copy of a prescription," the letter states. "Veterinarians are the only professionals licensed to write a prescription for an animal. Due to a veterinarian's unique education and training, we maintain that veterinarians are also the best-qualified professionals to provide guidance when dispensing prescription products for animals."
The passage of the law and its resulting changes probably won't hit the veterinary profession within the next six months but sometime in the next two years, Paul predicts. But it's not all bad, he says.