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An Affiliate of the Pharmacists Society of the State of New York

Why Did Your Pharmacy Close ?

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This letter is in response to the recent closing of the Montgomery Village Pharmacy. I am a member of The Pharmacists Society of Orange County and owner of a local independent pharmacy. The independent pharmacies across the county are not competitors, in a way, we are a family looking to help each other and our communities. So, when a local pharmacy closes, we as a family all hurt. We understand the impact on the community and try to help each other where we can. So why did the pharmacy close? Over the last 2-3 years, independent pharmacies have been struggling to stay in business. You might have recently heard about PBMs (Pharmacy Benefits Manager) otherwise known as the “Middleman”. The sole responsibility of the PBM is to negotiate for insurance plans to keep costs down, unfortunately they used this knowledge and power for their own profit and gain. Which leads us to the question we need to answer first: Why are drug prices going up? The PBMs evolved into very greedy entities. They pay the pharmacies for the prescription, sometimes below the cost of the drug. The PBM then charges your insurance plan an inflated price for that very same prescription. The PBM keeps the difference as profit. This is the reason that drug prices are going up. PBMs are getting rich, and independent pharmacies are going out of business. This is also the reason health insurance premiums are skyrocketing. There are over 200 plus PBMs in this country. Three of them control over 85% of all prescriptions filled in this country. Chances are, you have one of these three printed on your insurance card. (CVS/CAREMARK, EXPRESS SCRIPTS, OPTUMRX) If you notice the first one is owned by CVS. Yes, that is correct. CVS is responsible for paying pharmacies all across the country including Montgomery Village Pharmacy. Some would say this is CONFLICT OF INTEREST. With the PBMs having the power to determine the cost of drugs to the pharmacy, the reimbursement to the pharmacy, and the cost or copay to the patient, to over 40% of all prescriptions filled, they heavily influence which pharmacies survive. For anyone who has gone into a pharmacy and was told that their medication was not covered, the reason again is your PBM. They could not negotiate a contract with the drug manufacturer to receive a rebate (very profitable one at that). So, when your doctor writes a prescription that they feel is the best for you, and the PBM doesn’t make a lot of profit, it is not covered. Essentially, the PBMs are telling your doctor what to prescribe Some of you are required to use “mail order”. They (the PBMs) say this keeps costs down. This is not always true. In some cases, mail order sends prescriptions that are no longer needed. This includes a change in dosage or a different drug completely. Additionally, uncontrolled temperatures in the delivery process can ruin medication. It is for these reasons, that the PBMs mail order service can be extremely wasteful.
Recent data suggests in New York PBMs are overbilling 300 million dollars a year. The school district, local municipalities, government services and benefits use the same benefits manager, and we are quite confident of similar results. Even if you don’t have one of those plans, they are still funded by taxpayer dollars. As a New York State taxpayer in Orange County, this should outrage all of us. We are paying our hard-earned money to line the pockets of these greedy PBMs. What can we do to help prevent one more pharmacy from closing its doors? Your local pharmacists have been working hard over the last year to make sure all our local assembly and state senate are aware of these issues. Thanks to their help, the Governor has proposed a budget that addresses these issues. We need for you to call your local politicians and thank them for their hard work and ask for them to make sure that the Governors budget passes just the way it is written with very strict regulations on these PBMs so they cannot cause one more independent pharmacy to close their doors in this wonderful county.
The Pharmacist Society of Orange County would like to thank all of you who took the time to read this letter. Many thanks to the administrators of this group for allowing us to post this letter. Please feel free to contact us. We are even open to the idea of a live forum or seminars throughout the county to answer questions. We do have a link to help direct you to any assistance at

Respectfully, The Pharmacists Society of Orange County

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