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The Globe and Mail

Shoppers pulls support from pharmacists' group

Jurgen Schreiber's latest assault - this time on a former ally - is rattling an industry already grappling with unwanted drug reforms.

In the spring, the chief executive officer of Shoppers Drug Mart the country's largest drug-store chain, waged an unsuccessful war over Ontario's generic drug proposals and their big hit to pharmacies' bottom lines. The changes are expected to be adopted to various degrees across the country.

Mr. Schreiber is now turning his guns on the Ontario Pharmacists' Association, one of the key groups that joined him in opposing the government reforms. About two weeks ago, Shoppers notified the association that the retailer would no longer cover the $500 annual membership fee for its 1,300 or so pharmacists who are members of the OPA. The Shoppers pharmacists are free to maintain their memberships, but they will have to pay the fees themselves.

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"We have too many pharmacy associations - too many lobbying groups," Mr. Schreiber said in a brief interview after addressing students at the University of Toronto's Rotman School of Management this week. "We have to have a very strong lobbying group. You have to pick and choose."

At stake for the OPA is roughly $650,000 of annual membership fees that Shoppers pays on behalf of its pharmacists. The company's pharmacists make up about 18 per cent of OPA's membership.

"We're disappointed," Dennis Darby, chief executive officer of the OPA, said in an interview. "We're a little surprised."

While he didn't blame the bad blood directly on the drug reform battle, "you'd have to assume it's all related."

"I'm sure Mr. Schreiber and I would agree that the government acted pretty harshly," he added. "I don't think anybody was effective at stopping the government from implementing its policy."

The withdrawal of financial backing by Canada's leading chain reflects the divisiveness in the pharmacy industry over the reforms, which ban an estimated $750-million a year in so-called professional allowances that generic drug companies paid to drug stores. Shoppers was something of a poster child in the battle; it took considerable public heat for scaling back its opening hours in protest over the new rules. When its tactics failed to make a difference, it was forced to backtrack and find cost savings elsewhere.

John Caplice, a senior vice-president at Shoppers, said in an e-mail that "when faced with choices about where to allocate resources, including financial and human capital, we make such decisions based on generating the greatest return on our investment.

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"That's really all it comes down to, nothing more, nothing less and other companies have made similar decisions over the years. As a company, Shoppers Drug Mart has not been a member or a direct sponsor of the OPA in the past."

Today, Mr. Schreiber is racing to put his chain on a firm footing by preparing to snap up weaker pharmacies while drug stores across the province scramble to find an effective business model.

Now that the new rules are in effect, the OPA is working with the government to try to get more public funds for services that pharmacists provide to customers, such as health consultations. And it's trying to ensure that the government adopts legislative proposals to allow pharmacists to refill or modify prescriptions.

"Would I like to be more effective?" Mr. Darby asked. "Would I like to have more influence with the government to help steer their policies? Most certainly, and we're going to keep trying."

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