By Mariann Caprino
NEW YORK _ The race is on to sell drugs by mail.
A sleepy, back-office operation just a decade ago, the
mail-order drug business suddenly is crowded with new players,
each vying for a piece of a mushrooming $4 billion market.
It doesn't mean the postman is about to replace your
neighborhood pharmacist, but it is changing the way millions of
Americans on health plans get prescription medicines.
Seventy percent of all prescriptions are for so-called
"maintenance drugs," taken regularly for chronic ailments like
arthritis and high blood pressure.
It is this business mail-order pharmacies seek to capture.
They sign up big corporate clients _ like General Electric, Alcoa
and Mobil _ with the promise of cutting companies' health-care
benefit drug bills by up to 20 percent.
Savings come in many ways. Mail-order pharmacies buy in bulk
and therefore can muscle significant discounts from drug
manufacturers. They work to substitute cheaper brand-name
equivalents or generic drugs. Even large mail-order pharmacies
with geographically dispersed clients can operate out of just a
few facilities, minimizing overhead.
These centralized pharmacies aren't mere store rooms crowded
with jar-filled shelves. They are state-of-the-art facilities
that use computers to monitor patients, robots to retrieve pills
and machines to count them.
Mail-order pharmacists don't have to walk over garden hoses or
point customers in the direction of the deodorant counter.
Instead, they oversee quality control.
Sophisticated computer technology allows them to retrieve a
patient's file, track allergies to medication and check whether
the patient is taking other drugs that may not be compatible.
Medco Containment Systems Inc. of Montvale, N.J., is the
industry's leader with a 50 percent share of the market. Plans to
expand further were cut short this month when a $411 million
merger with rival Diagnostek Inc. collapsed.
Other leaders include Baxter International and Express
Pharmacy Services, owned by the Thrift Drug chain, a division of
J.C. Penney Co.
In recent months a rash of new players has appeared,
Walgreen Co., which operates 1,700 drug stores nationwide,
decided to put a new and concentrated emphasis on mail-order
sales. The company, which has a dispensing facility in Phoenix,
opened a high-tech pharmacy in Orlando, Fla., in September.
Fay's Inc., which owns 300 drug stores in the Northeast, in
October created Postscript, a mail-order division that will begin
operating in April from a Pennsylvania facility.
Value Health Inc., an Avon, Conn.-based managed care company,
acquired the Iowa mail-order drug concern Stokeld Health Services