The Big 3 Distributors: Healthcare reform

Healthcare reform

Fitch says it expects healthcare reform to result in moderate increases in prescription volume beginning in 2014. The ratings company anticipates "moderate margin compression" as government and other plan providers negotiate lower reimbursement rates with distributors' customers: pharmacies and drug manufacturers. But distributor fee-for-service contracts with branded drugmakers should compensate. And distributors' strong negotiating position with generic drugmakers will help, too.

"The biggest challenge will be keeping up with changes," says Peyton of ASB regarding healthcare reform. "We see a rise of 30 million in the number of insured," she says, but it will take several years to see the growth from the newly insured. The company expects all drug sectors--generics, prescriptions, over-the-counter--to rise.

"The three key pillars of healthcare reform are access to health, improving the quality of care and reducing costs," says John Figueroa, president at McKesson U.S. Pharmaceutical. "We're working with the government, healthcare providers, pharmacies, consumers and others to remove unnecessary healthcare system costs as we ensure the timely delivery of products."

In a January interview with SmartMoney, Cardinal CEO George Barrett said 2010 is a transition year, and the company is moving toward "a more attractive and sustainable model for sourcing products."

The Big 3 Distributors: Healthcare reform