Insights (Essays)

Insights (Essays) September 2010

Ontario Generic Drug Wars, Part 3: The Soul of the Pharmacy Profession

Steven Lewis

All members of the [Ontario] College [of Pharmacists] have moral obligations in return for the trust given them by society. They are obliged to act in the best interest of and advocate for the patient, observe the law, uphold the dignity and honour of the profession, and practice in accordance with ethical principles and their respective standards of practice.
– Code of Ethics for Pharmacists in Ontario

What a peculiar profession is retail pharmacy. Drugstores whose main business is drugs have gone the way of the corner hardware. Go into London Drugs and the hardest thing to find is the pharmacy, tucked away at the back, forcing you through the aisles of cosmetics, televisions, cameras and magazines on your way to the potions. There is no more honestly named firm in Canada than Shoppers. A Walmart pharmacist in Ontario fessed up to a local doctor that company policy mandates a 35-minute interval between presenting and filling a prescription to allow ample time to empty the customer’s pockets. The pharmacy and the pharmacists are increasingly fronts for these retail juggernauts.

Prior to the recent policy changes, generic drug manufacturers paid Ontario retail pharmacies an average of $100,000 per pharmacist per year in “professional allowances,” more honestly described as rebates and less charitably termed kickbacks. Government policy formalized the rebate rate at 20% and allowed a further 10% markup in the final undiscounted price. So: The invoice price from the manufacturer was $10. The manufacturer paid the pharmacy $2 as a rebate. The consumer paid $11. Hence the pharmacy made $3, or 37.5% ($3 profit on $8 net cost). A 10% markup to cover the costs of inventory and administration is not unreasonable. But a 37.5% profit aligns the pharmacist’s interests squarely with increased sales.

How do you spell “conflict of interest”? You would think that a profession dimly aware of the above-cited preamble to its code of ethics would find this unholy pact to conflict with the duty to serve the public good and uphold the honour and dignity of the profession. Not a peep from the official voices of pharmacy (the professional association and the regulatory body). Too many doctors are inept prescribers, and a fifth of admissions of older adults to hospital result from adverse drug reactions. We need pharmacists to offer their counsel, exercise their judgment and communicate with physicians in service of our health and well-being.

Overmedication is the spirit of the times; pharmacists must be prepared to question physicians’ decisions and stand on guard for prudence and restraint. Yet we were to believe that pharmacists (and/or their employers) whose income significantly depended on volume-based rebates from manufacturers would be unaffected by these arrangements. Discouraging consumption meant no markup profit, no dispensing fee and a 15-minute explanation; getting out of the way generated markup, a dispensing fee and a few minutes of low-intensity chat.

No doubt many fine pharmacists put professionalism above profit, but the system was designed perfectly to encourage timid acquiescence to doctors’ orders. Why would we have expected otherwise? Tying their incomes to sales addicted them to volumes and made them part of the pharmaceutical sales force – just as the manufacturers intended.

There is a difference between being in the health business and being in the drug business. A profession dedicated to health would have publicly opposed the institutionalization of the rebates because they compromise objectivity about the products dispensed. Instead the Canadian Pharmacists Association took Ontario Health Minister Deb Matthews to task for urging other provinces to follow Ontario’s lead (Canadian Pharmacists Association Responds to Health Minister’s Letter on the Ontario Drug Reform Proposals 2010).

Pharmacists have been demanding – and to some extent getting – an expanded role in the delivery of healthcare, notably some power to prescribe and renew prescriptions. But they have “moral obligations in return for the trust given them by society.” Is their principal obligation to the store owner/rebate payer/shareholder or to the public? It cannot be both. I am in principle in favour of liberating pharmacists (and nurse practitioners, licensed practical nurses and therapists) to use all of their knowledge and skills, advance their careers and expand their good work. But first I have to be confident that they will put my health above their interests should they be in conflict. A profession that willingly tethered its income to my consumption of drugs gives me little confidence that it will uniformly forsake a sale for my well-being. Some pharmacists will; some won’t – and I won’t know the difference. That’s not good enough.

Hence, the profession has some soul-searching to do. It needs to decide what it is – part of the healthcare-is-a-commodity-and-caveat-emptor oligopoly, or professionals who seek to work in an environment and under incentives that reward them to do the right things well, uncompromised by excessive commercial influence. Pharmacy is by no means alone in this dilemma, but its importance is magnified by being part of the fastest-growing health sector with a well-documented history of ethical missteps. Pharmacists enriched themselves by embracing the rebate scheme. I lack the sophistication to understand how this complicity did not conflict with the profession’s code of ethics.

Those with a taste for irony will relish the University of Toronto’s promoting the PharmD program as the entry-to-practice credential for all pharmacists. That’s rich: the solution to the systematic underuse of pharmacists’ baccalaureate education is to stuff them with more education. Absurd as it may seem, they’ll probably get their way, like the nurses, occupational therapists and physiotherapists got theirs. If the PharmD curriculum concludes with a year of intensive ethical study, perhaps some good will come of this boondoggle.

Finally in the series: implications for medicare.


This essay is from a four part series. Please see the links below for Parts 1, 2, and 4.

Steven Lewis: the Generic Drug Wars:

Part 1: How It All Began
Part 2: Did Retail Pharmacy Need Rebates?
Part 4: Lessons for Medicare

About the Author(s)

Steven Lewis is president of Access Consulting Ltd., in Saskatoon, Saskatchewan, and is an adjunct professor of health policy at the University of Calgary and Simon Fraser University.


Canadian Pharmacists Association Responds to Health Minister’s Letter on the Ontario Drug Reform Proposals. 2010. Toronto, ON: CNW. Retrieved September 7, 2010.


Be the first to comment on this!

Note: Please enter a display name. Your email address will not be publically displayed