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Omdahl: Measure 7 hits locally-owned pharmacies

By Staff | Oct 10, 2014

North Dakota law requires that pharmacies be owned by licensed pharmacists. This law was passed to protect these small businesses from the competition of the chain pharmacies and big box stores.

Unable to persuade the legislature to repeal the law, the box stores and chain pharmacies are now pouring money into the state in support of Measure 7 which proposes to repeal this ownership requirement.

Since I have not had occasion to visit a big box pharmacy in another state, I am unable to determine whether or not the advertising for repeal of the pharmacy ownership law tells the whole story. Campaign advertising seldom does.

There is no doubt that repeal of this law will enable box stores and pharmacy chains to claim a significant share of the pharmaceutical market. Existing locally-owned pharmacies throughout the state will suffer to one degree or another. With these giants in the market, some pharmacies will fold.

Some of the same folks supporting this measure being financed by out-of-state money are the same people complaining about the out-of-state funding that is going into the Measure 5 campaign for conservation, clean water, wildlife and parks.

When it comes to Measure 5, all of the money will be spent on projects right here in North Dakota. When it comes to Measure 7, the money will not stay in North Dakota but end up in Minneapolis, Arkansas and other out-of-state pockets.

The letterhead for “North Dakotans for Lower Pharmacy Prices” lists around 25 individuals, practically all of them from the larger urban communities. Maybe they signed because passage would reward their cities with a greater share of the market at the expense of the smaller communities.

But locally-owned pharmacies in the larger communities will be placed in greater jeopardy than the pharmacies in smaller towns because the box stores and chain pharmacies will be located just down the block while pharmacies in smaller communities will be protected somewhat by the miles to travel.

Nevertheless, the loss of locally-owned pharmacies in smaller communities will have a negative impact on rural North Dakota.

In the first place, local pharmacies represent a larger proportion of the community’s gross business than those in larger cities so the economic impact on the community will be greater.

Second, smaller communities have fewer businesses to keep home towns viable. Taking the pharmacy out of main street means one less business to attract shoppers and maintain a main street.

Third, much of the personal income generated by the pharmacy for the owners is spent right in the community.

Big box money will leave the state.

Fourth, home-town businesses have home-town interests. They underwrite the extras for local sports teams, civic programs, local recreation and community promotions.

While the executives in chain stores focus on promotions and salaries, the local druggist is participating in local government, serving on community committees, and attending service clubs.

Fifth, smaller communities need all of the local leadership they can muster. Most pharmacists in small communities are civic leaders and a part of the local medical team.

We tell ourselves that the rural social and economic fabric of the state is worth preserving. That is our strongest arguments for investing state and federal money in local water systems, highways, farm subsidies, rural housing, and tax breaks.

The box stores and chain drug companies may actually save folks a couple of bucks here and a few pennies there. In the past, we have chosen savings at the cost of locally-owned grocery stores, service stations, variety stores, and other local businesses.

Measure 7 will determine whether or not we want the trend of small business demise to continue.

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