A 15 Year Ecological Comparison for the Market Dynamics of Minnesota Community Pharmacies from 2002 to 2017

Abstract

Background: Understanding the factors that influence the market entry, exit, and stability of community pharmacies (i.e., market dynamics) is important for stakeholders ranging from patients to health policymakers and small business owners to large corporate institutions. Objective: The study’s first objective was to describe the market dynamics of community pharmacies for Minnesota counties in 2002, 2007, 2012, and 2017 by associating county (a) population density and (b) metropolitan designation with the change in the number of ‘All community pharmacies,’ ‘Chain community pharmacies’, and ‘Independent community pharmacies’. The study’s second objective was to describe the number and proportion of community pharmacies for Minnesota counties in 2002, 2007, 2012, and 2017 by (1) ‘Business Organization Structure’ and (2) ‘Pharmacy Type.’ Methods: County-level data were obtained from the Minnesota Board of Pharmacy, US Census Bureau, and Minnesota State Demographic Center for 2002, 2007, 2012, and 2017. Findings were summarized and the associations between study variables described using descriptive statistics. Results: The ratio of ‘Independent community pharmacies’ to ‘Chain community pharmacies’ was about 1:1 (466:530) in 2002, 1:2 (352:718) in 2007, 1:2 (387:707) in 2012, and 1:3 (256:807) in 2017. There was not a consistent relationship that carried through the 15 year analysis between county population density and metropolitan designation and the market dynamic patterns of community pharmacies. The types of pharmacy in Minnesota changed significantly over the study with increases in state, regional, and national chains and declines in single entity and small chain independents. There were also notable declines in mass merchandiser community pharmacies and increases in clinic and medical center community pharmacies. Discussion: The findings suggest that different or additional factors beyond traditional market dynamic predictors of population density and metropolitan designation were at play in each five year interval of this study. We propose that the traditional dichotomy of independent and chain community pharmacy groupings no longer provide an optimal characterization for the market dynamics of pharmacies today. Instead, community pharmacies may be better organized by their capacity to operate as healthcare access points that provide and are reimbursed for patient care and public health services like medication therapy management, immunizations, and more. Conclusions: The findings showed that community pharmacy distribution in Minnesota’s 87 counties has shifted between 2002 and 2017 from traditional retail models to emerging healthcare models based on population health needs. This signals the need for not only a new approach for tracking community pharmacy market dynamics but also adjustments by community pharmacies to remain relevant in a new environment of patient care services.

Using Health Insurance Network Provider Data and Public Data Sets to Identify SARS-CoV-2 Vaccinators in the USA

“…Sendero members preferentially used chain community pharmacies to obtain vaccines during the study period ( n = 87; 93.5%). Such utilization patterns may reflect ease of access, geographical preference, population density, and general changes in the marketplace that tend to favor chain community pharmacies over independent community pharmacies ( 12 ). A detailed analysis of Sendero member pharmacy preference to obtain a vaccine has not been conducted.…”

Pharmacist Segments Identified from 2009, 2014, and 2019 National Pharmacist Workforce Surveys: Implications for Pharmacy Organizations and Personnel

“…As mentioned in the introduction of this paper, pharmacies are being organized by their capacity to operate as healthcare access points that provide patient care and public health services. Comprehensive integrated care models are being created through horizontal integration with clinics, medical centers, community centers, and even places of employment [ 8 , 9 , 10 , 11 , 12 ]. Vertical integration between insurance companies, wholesalers, manufacturers, integrated delivery networks, pharmacy benefit management companies, and health care centers are being formed to coordinate services, improve access, leverage data, and bear financial risk for health outcomes of patient populations [ 9 , 14 , 15 , 16 , 17 ].…”

“…Recent market-driven shifts have moved community pharmacy practice from the traditional "locational convenience" strategy to one in which pharmacies are "being organized by their capacity to operate as health care access points that provide and are reimbursed for patient care and public health services" [8][9][10][11][12]. Also, health-system pharmacy practice has been changing from largely acute care models to more comprehensive integrated care models [13] through horizontal integration with clinics and medical centers so that medication and medical costs can be combined in risk portfolios and meet pay-for-performance goals [14].…”

Healthcare clinic and pharmacy chains in Kenya and Nigeria: How are they regulated, and what opportunities and risks do they present to national regulatory systems?

“…However, the regulatory systems in these countries are inadequate and ill-suited to manage these challenges and future market evolution. The emergence of chain healthcare businesses is one feature of these changes; while the market share of chains is still relatively low, there are indications that this will increase rapidly in future, supported by injections of external capital, and following similar trends in higher income countries (22). Since 2018 when the data for this paper were collected, the Kenyan pharmacy regulator has become stricter in enforcing pharmacy zoning, where new premises are denied registration if they are deemed to be located close to an existing one (distance de nition determined by area population size and other factors).…”

“…There is no standard de nition of a chain. Studies have de ned chains to include businesses with more than one establishment (20), four or more establishments (21) and more than ten establishments (22).…”