Retail chains that contain pharmacies, such as CVS, Walgreens, and Rite-Aid, have a somewhat paradoxical business model. On one hand, their pharmacies play an increasingly important role as the mediator between physicians and patients by dispensing medications, both over-the-counter and prescription, as well as public education about them. On the other hand, these chains also compete with 7-Eleven and similar outlets that sell sugary foods such as candy, ice cream, and soda – products that are at odds with a mission to promote health and wellness.
Tobacco, and now e-cigarettes, are perhaps the most troublesome products in this respect. As a matter of ethics, should a retail “drug store” sell tobacco? This question perhaps provides the litmus case study of the broader question about whether a retail business partnering with healthcare organizations should sell any potentially harmful products.
In recent years, CVS has been moving away from its position as a “drugstore” and more toward becoming a limited provider of healthcare services. Outlets now routinely offer flu shots and other vaccinations; more significantly, the CVS Caremark program is a sophisticated system of prescription management that partners directly with both healthcare providers and health insurance plans.
For this reason, CVS leadership decided in 2014 to discontinue sales of cigarettes and other tobacco products. Management felt it is hypocritical to offer customers access to harmful products while publicly promoting a concern with consumer health. CVS also understood that the move, although costly in the short-term, could provide the chain with a competitive advantage over rival pharmacies that continue to sell cigarettes by increasing its standing with its health system partners.
Given the pressures of corporate responsibility, it’s not farfetched to assume that healthcare companies would be more inclined to do business with CVS over chains that continue to sell cigarettes. Critics who believe other pharmacies should follow CVS’s lead argue that prohibiting tobacco products is the most ethical response. As a matter of public policy, CVS has been praised by a number of stakeholders, including former President Barack Obama, for taking a stand and being socially responsible.
While CVS is betting on a long-term advantage, Rite-Aid and Walgreens continue to sell tobacco products, since their business models are focused more on the potential downsides of reducing consumer options. One of the most obvious, of course, is a loss of profits.
In fact, CVS estimated a loss of $2 billion dollars because of their new policy, and the company’s stock went down after the announcement that it was eliminating cigarette sales. Conversely, the stock of Walgreens and Rite Aid went up – which showed that investors believe selling cigarettes is more beneficial financially, at least in the short-term.
When confronted with the choice to follow the lead of CVS, Walgreens leadership argued that selling cigarettes is necessary to remain competitive with its rivals. Similarly, Rite Aid executives stated they would continue selling cigarettes based on the needs and demands of its customers.
Yet, at the same time, Walgreen’s has partnered with GlaxoSmithKline Consumer Healthcare to launch Sponsorship to Quit, a free online smoking cessation clinic. Meanwhile, Rite-Aid also hosts an online Quit Smoking Solution Center to help tobacco users who want to quit. While these gestures might appear hypocritical, neoliberal critics claim that as mass retailers, chain drugstores must respond to consumer demands and offer products and services that all types of customers desire, whether harmful or healthful, if it’s legal to do so. They point out that CVS continues to stock candy at their pharmacy pickup counters, a business decision clearly based on the power of impulse buying that is difficult to reconcile with the dramatic rise in diabetes their prescriptions are designed to treat.
As members of the health profession, drugstore pharmacists are faced with a difficult choice. They must survive in an environment in which the law of supply and demand is apparent, and they know that if less-than-healthy products aren't available in their drugstores, consumers will simply get them elsewhere.
So, it comes down to two points of view:
Which side does your pharmacy land on?