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  • robbsbeach robbsbeach Aug 8, 2012 3:07 PM Flag

    Mail-order Projection's UP!!

    The dispute with Walgreen totally helped mail," Paz said,
    adding that two former Medco executives on his team have strong track records of driving mail order business.

    rival PBM CVS Caremark Corp has said it expects to retain at least 50 percent of the prescription business
    it gained from Walgreen during the dispute with Express Scripts, also projected mailorder to increase over 30%.

    Question is, how will this effect the the 1Q numbers, with Walgreens increase
    in costs to regain some of the ESRX Rx loss and what % will return.
    Its looking like the recovery may take longer than anticipated

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    • Good and valid points Robb.

      We should expect it will be difficult for WAG to recapture lots of Express patients quickly. If you review the analyst reports, take Rite Aid and CVS comments into consideration then WAG will recapture about 50% of the business by the end of their 2013 fiscal year. 1Q numbers from WAG will not give anyone a clear picture of how fast customers will come back with only 75 days of effort. 2Q numbers might be a better barometer of how they are doing.

    • Mail-order Projection's UP!! robbsbeach (1 Rating) 8-Aug-12 03:07 pm
      Re: Mail-order Projection's UP!!
      robbsbeach, You know my longstanding views on m... big.yank Rate it 8-Aug-12 03:41 pm
      Re: Mail-order Projection's UP!!
      big.yank Good post.. robbsbeach Rate it 8-Aug-12 03:45 pm
      Re: Mail-order Projection's UP!!
      So despite WAG and ESRX making up, WAG w... cmxgen Rate it 8-Aug-12 04:47 pm
      Re: Mail-order Projection's UP!!
      Hi Cmxgen: Glad to see your stil... robbsbeach Rate it

      I need to add that Walgreens plans to Spend 11B more in the next 3 years.
      On the A/B deal with reducing SG&A.

    • robbsbeach,

      You know my longstanding views on mailorder. I was ALONE on this board for years in talking up the inevitability of mailorder taking over major market share in Rx's, subject to massive shrieks of derision from pro-Waggies that I was totally wrong. Just like their protests that Walmart was going broke and that $4 generics would be gone as loss leaders, "any day now" when I predicted low cost generics would drive much of the forward market momentum.

      That (self-servingly) said, I think mailorder has run its course in future market share capture, UNLESS healthcare reform or PBM leverage forces the issue further. I think this is unlikely. My sad prediction is that AAC will be emasculated after the November election. It may not go away entirely, but I think it will have no real teeth. That's a win for the 1% who are donating huge sums to Romney's election campaign so they can avoid future tax increases in an Obama 2nd Term. I do not believe that such massive campaign spending by RNC PAC's can be offset by union and smallfish donations to Dems. I hate to admit that.

      The second part of "the mix" is that the largest PBM has just settled with Walgreens and may well need that retail leverage in its camp when Caremark goes hunting for new market share. Caremark CAN'T push mailorder because it effectively cuts the head off the CVS snake... so that leaves UNH and the bit players. I think these guys will look at the impact of the WAG/ESRX impasse on both parties and conclude they would rather avoid the mailorder conflict.

      My prediction? Mailorder wil remain about where it is in marketshare. 90-day scripts will continue to rise as both WAG, RAD, Indies and the grocery pharmacies conclude that it is the lesser of two evils and push relentless hell out of it.

      My guess. Mailorder is not going away, but I see a lot less growth in the near term, despite its obvious cost benefit to healthcare costs.



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