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Health Mart has the momentum.

SAN FRANCISCO -- In less than a year Health Mart, the pharmacy franchise of McKesson Corp., has grown from a little more than 200 stores to almost 1,400 outlets.

"Today, Health Mart is the largest independent pharmacy franchise and sixth-largest pharmacy chain in the country," comments president Stefan Linn. "And the franchise continues to grow every day."

He identifies three major factors that have driven "leading" independent pharmacies to adopt the Health Mart brand:

* Top pharmacy benefits managers have committed to listing Health Mart in their benefit materials. "Eight of the top PBMs--including Caremark [Rx Inc.], Express Scripts [Inc.] and Medco [Health Solutions Inc.]-have agreed to list Health Mart in patient communications," says Linn. "This ensures patients both old and new know that their insurance plan will be accepted when they go to a Health Mart store."

* The franchise's web site has built consumer recognition. "Launched last June, provides consumers with comprehensive health and wellness education comparable to other nationally known consumer health care information sites," notes Linn. "The web site has been instrumental in reinforcing the connection consumers have to Health Mart pharmacists as trusted health care advisers."

* Local advertising of Health Mart has been a success. "With the launch of the Health Mart marketing tool kit--which Health Mart pharmacists use to access customizable templates for local marketing and to place radio, TV and print advertising--every Health Mart now has the opportunity to market its services locally in a consistent and professional way," explains Linn, noting those vehicles range from direct mail and bag stuffers to flyers, press releases and television spots.

Health Mart plans to debut its first national advertising campaign this year across broadcast, print and online media. And Health Mart franchisees are serving as "ambassadors" to help expand the network through grassroots, peer-to-peer marketing.

Patients are helped by franchisee pharmacists in several ways.

Those health care professionals, says Linn, have embraced their roles as clinical advisers and counsel patients daily, whether as part of their traditional positions or as part of a medication therapy management program.

"Health Mart pharmacists also play a key role in their communities to help Medicare patients understand the Part D benefit and make good plan decisions," notes Linn. "In the second year of the benefit, we've provided consumer-facing brochures to help pharmacists counsel patients; so far, the enrollment process and new plan year have gone smoothly."

"Many pharmacists also use automation technology to help improve labor productivity, enabling them to spend more time with their patients. Finally, Health Mart pharmacists often recommend generic pharmaceuticals to help their patients achieve the same clinical outcomes [as they would with brand drugs] at lower costs."

Health Mart, says Linn, serves a broad range of patients and consumers but is particularly strong in meeting the needs of patients with chronic diseases who have been prescribed multiple medications.

"This segment of the population is growing rapidly," he notes. "Rather than just serving as a convenient point of dispensing medication, Health Mart pharmacies are about the patient/pharmacist relationship and about providing patients with a trusted community health care adviser/resource."



Stefan Linn, president


One Post St. San Francisco, Calif. 94104

Phone: (800) 369-5467 Fax: (415) 983-9353 Web site:

* INDUSTRY RANK--10 in sales, 5 in stores

* Full-year results (3/31107) (1)

Sales--$ 1.7 billion (2) Net earnings--N/A Net margin--N/A Comparable-store sales--N/A

* Number of drug stores--1,400

* Number of states operating--45

* Number of stores opened in fiscal 2007--1,142

* Number of stores closed in fiscal 2007--25

* Number of stores planned for fiscal 2008--1,100

* Average sales per store--$2.6 million (2)

* Average store size--3,500 sq. ft.

* Distribution--Wholesaler

(1.) Health Mart, a franchisor, is a unit of McKesson Corp. and. accordingly, does not report revenues or earnings.

(2.) CDR estimate.

N/A = Not available.
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Title Annotation:State of the Industry/The Chains; Health Mart
Publication:Chain Drug Review
Article Type:Company overview
Date:Apr 23, 2007
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