Feeling the big squeeze: Inflation is pinching pharmacists everywhere—and it hurts

Everything’s going up—except pharmacists’ fees and profits. As the rate of consumer inflation in Canada continues its upward trajectory—hitting an 8.1% year-over-year increase in June—pharmacists across the country are getting squeezed financially in virtually all aspects of their operations. While some have taken steps to try and mitigate the impact of inflation, the consensus seems to be that there isn’t much to do about it except hang on and sit tight. “It’s tough for us because our fees and prescription prices are set by the government,” said Melissa Hozack who co-owns, with her husband Rob, Pharmasave Redcliff in Redcliff, Alta. “We have no wiggle room—we can’t just bump up our fees.” Under different circumstances, Hozack and her husband might have tried to make up for rising costs with higher-volume sales on front-store items. “But there’s such a shortage of items for our front store,” said Hozack. “So it’s not like we can say ‘let’s push our generic brands’ because we can’t get even a lot of those products.” Read: Majority of pharmacists concerned about inflation and labour issues More than 3,100 kilometres east in Toronto, Pace Pharmacy founder and owner Adam Silvertown, has been feeling the same pain. The cost of running his pharmacy business has been going up and keeps going in that direction. “Things like water and electricity costs, rates of shipping, fuel surcharges from all the couriers we work with, what we pay for cleaners —they’re all up,” said Silvertown. “All our suppliers have sent out a memo telling us they’re raising prices—we’ve seen increases from about 4% to as high as 12%.” These price increases on products and supplies have affected a wide range of items, from over-the-counter drugs to medicine vials, prescription paper bags and cleaning supplies. Last year Pace Pharmacy introduced a comprehensive health and dental benefits package for employees. Premiums for this have gone up too, said Silvertown. Read: Finding your niche: Making the pharmacy a safe space for LGBTQ patients North of Toronto, Samier Kamar—co-owner of High Street Guardian Pharmacy in Peterborough and Dellar’s I.D.A. Drug Store inTweed, Ont.—reported similar cost increases in his pharmacies’ operations. Fingers crossed that nothing breaks in his stores in the near future, said Kamar “because plumbers and electricians have increased their fees as well. Even the company we use on a regular basis to shred papers has increased their price.” Adding another layer of financial difficulty is the speed at which new generic drugs are coming into market. This creates a challenge for pharmacists because these new generics tend to go to market at lower prices than their predecessors, and the province is quick to adjust what it pays based on the latest price. “So if we previously bought a product for $100 but a new version comes in priced at $50, if we don’t get rid of the older product right away we’ll need to sell it at $50,” said Kamar. Read: Look beneath the tip of the iceberg Meanwhile in Port Hawkesbury, N.S., The Medicine Shoppe owner Michael Hatt is seeing the impact of inflation “all along the supply chain.” Price increases are especially noticeable in home healthcare, creating hardships for many vulnerable patients, said Hatt. “A wheelchair that may have cost $200 to $250 two years ago is now more like $350 to $400,” he said. “Which is a shame because we have to pass on the cost to our customers.” As a small business that maintains thin inventories, Hatt’s pharmacy needs to re-order products more frequently. This means it gets hit with price increases a lot sooner than a bigger operation that stocks more products. “I’m seeing this even in little things: sunscreen that we ordered at a cost of $8.50 last week is now at $12.50 this week,” said Hatt. Read: Innovator: Pharmacist comes home to create his ultimate pharmacy One doesn’t have to peer too close to see how much inflation is also hurting patients and employees. Kamar and his father, who have a longstanding practice of extending credit to regular patients, have noted outstanding balances that are larger than usual and taking longer to get settled. They’re also aware their employees are struggling to cope with the higher costs of everything from groceries to gasoline. They raised staff wages recently and started to pay for staff’s lunches. But are there certain actions pharmacists can take to ease the burden of inflation on their business? Silvertown said he’s looking for ways to cut costs and has been talking to vendors in hopes of finding solutions. He has also started to pass on some delivery costs to patients, but doesn’t do this across the board. Read: The price and promise of the pandemic “We can’t really do much,” said Silvertown. “We’re just trying to control costs and being more mindful of things that maybe we haven’t been too mindful of in the past.” One way Hatt has reduced shipping costs on certain products is by setting a minimum number before re-ordering. “We are mandating that we will not order until we have a minimum requirement to qualify for lower shipping,” said Hatt. “Unfortunately this will have an impact on our customers, because a lot of those products will be special-order items that patients need for mobility, like a specialized wheelchair or commode. Whereas normally we would order whenever we needed to and we would just absorb the extra shipping cost.” Hozack at Pharmasave Redcliff said she’s trying to counter the negative forces of inflation by increasing revenue from clinical services. “Paid clinical services are the only way we can make anything extra, so we’re really pushing on that as far as what our provincial framework will allow us,” she said. “We’ve even given bonuses to our staff pharmacists, where once they hit a certain point some of those services go right back to them. That way we make it beneficial for everyone.” Read: Compassion in pharmacy practice Over in Peterborough and Tweed, Ont., Kamar is working hard to trim the fat in his operations. Inventory is one area that he’s paying close attention to. “One thing I’ve been telling my front store and prescription staff: the things that aren’t being turned over that much, put a sale on it and get rid of it,” he said. “And don’t reorder it.” He’s also focusing more on clinical services. He charges patients for re-prescribing and for administering vaccines, such as those for shingles and hepatitis. He also asks patients to pay in advance for expensive or special-order medications. This takes away the risk that the patient might decide not to buy the drug after it arrives. These practices take some extra effort—in particular, to educate patients about the value of pharmacy-based healthcare—but Kamar considers them part of the broader campaign to change how patients view their community pharmacist. “It boils down to two things: what is your worth to your patients and how can you educate your patients to show them your worth?” he said. “As inflation goes up, our value should go up too.” Read: 'Utmost urgency': Should Ontario pharmacists get OK to prescribe for minor ailments now?

Feeling the big squeeze: Inflation is pinching pharmacists everywhere—and it hurts

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