As pharmacies across the country close and pharmacists strike for higher working conditions, industry experts are analyzing the implications for consumers. 

It wasn’t so way back that major drugstore chains were committed to expansion, with the intention to be on every corner making health services widely accessible — this approach proved successful throughout the COVID-19 pandemic. Nevertheless, the strategy is now going downhill with many major retailers announcing closures. 

In October, Rite Aid filed for Chapter 11 bankruptcy. Meanwhile, earlier this yr, in June, Walgreens announced it might close 150 doors, following 200 store closures in 2019. In 2021, CVS said it might close 900 doors over the subsequent three years. Experts attribute these closures to the sheer amount of pharmacies, the dearth of pharmacists, and theft and shrinkage attributable to organized crime. 

“We’re coming to the tip of an era of the buildout of United States pharmacy,” said Matthew Hamory, managing director at global consulting firm AlixPartners. 

In accordance with Hamory, the tip of COVID-19 has placed pressure on pharmacies, as consumer traffic and demand for vaccines and medications has slowed. Moreover, drugstore chains are also coping with pharmacist shortages and walkouts, which has led to additional closures. 

With these increased closures and consolidations, consumers may struggle to access services; brands may face sales plateaus, and pharmacies might want to rethink the client experience. At the identical time, certain telehealth corporations may experience growth. 

“There may be actually a risk of pharmacy deserts forming,” said Hamory, calling out areas where organized crime is common, corresponding to San Francisco, as potential places where increased closures may occur. “That might create pharmacy deserts not because they don’t wish to be in the world or they couldn’t fill scripts but because they’ve issues of safety.”

“Unfortunately, numerous the pharmacies which are being closed or face the potential for closure are those within the communities that don’t have numerous access,” agreed Kate Maheu, associate partner within the health care and life sciences practice of Kearney.

Due to this fact, chains might want to respond with solutions. 

“As these closures begin to work their way through the system, they [the big pharmacy players] might be asked, ‘How are you compensating for the closures in the event you’re impacting the access for a single community,’” said Maheu.

She pointed to expanded services and offerings, corresponding to different delivery options or windows, as a solution to satisfy demand, as single locations develop into chargeable for larger and more diverse communities. 

Similarly, store closures hurt beauty and private care brands, as their footprint inherently decreases as well. Experts say retailers should consider latest strategies for customer experiences and types that depend on pharmacies for exposure should expand their e-commerce approach. 

“Retailers must evolve their proposition to be more digital…whether it’s through an app or the web site to experience the shop more,” said Hamory. 

In accordance with McKinsey partner Anna Pione, online retail channels have gotten increasingly popular amongst consumers looking for vitamins, minerals and supplements, while over-the-counter drugs, like painkillers or cold and flu medicine, remain popular in-store staples, on account of the immediate need often related to these. 

“We’re seeing the rise of retail e-commerce, in addition to direct-to-consumer channels, across the buyer health space,” Pione said. “Within the vitamin space, there are intrinsic dynamics that make direct-to-consumer economics price it. You could have a really predictable, repetitive consumption. Products don’t are likely to expire in a short time and the price-to-weight ratio is smart.” 

With access decreasing, experts say telehealth corporations could see a spike, namely those providing prescriptions a consumer uses regularly. Nevertheless, for as-needed medications for conditions just like the flu or COVID-19, pharmacies are still the foremost supplier. 

“The challenge in those [telehealth] models today is that they either serve area of interest or specific needs, or they haven’t found a solution to do the total end-to-end services or offerings of the brick-and-mortar pharmacy,” said Maheu.

For corporations like Musely, a web based platform for prescription skincare products, and Wisp, a sexual and reproductive health telemedicine site, drugs can easily be delivered to the user’s door, removing the necessity for the physical store. 

“We use [a] compounding pharmacy… There’s a fundamental difference by way of work,” said Musely founder and chief executive officer Jack Jia. He explained since pharmacists are making medications live, it makes for a more dynamic and enjoyable work environment. Plus, this model significantly brings down the value for consumers, which has driven the corporate’s growth. 

Continued growth within the telemedicine sector could also “exacerbate among the physical store closures,” based on Hamory. 

CVS declined to comment for this story. Walgreens didn’t reply on the time of publishing. Rite Aid shared the next statement: “Rite Aid commonly assesses its retail footprint to make sure we’re operating efficiently while meeting the needs of our customers, communities, associates and overall business. In reference to the court-supervised process, we notified the Court of certain underperforming stores we’re closing to further reduce rent expense and strengthen overall financial performance.” 

While mass closures inherently sound negative, experts say there could also be some positive changes to stay up for. 

“You may see improvements in service levels and customer satisfaction around pharmacy,” Hamory said, noting service is one among the largest qualms for consumers when visiting a drugstore. “If we close one and redistribute resources to the opposite that makes it somewhat higher.”