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Clarence F. “Rick” Olson, Published January 02 2011

ND’s current pharmacy law forces residents to pay more

Did you know there is an outdated law in North Dakota that forces most people in the state to pay more for their prescription drugs?

It is true. North Dakota is the only state in the country that requires a pharmacy to be at least majority-owned – 51 percent – by a licensed pharmacist in good standing. This is why the major national retail store chains such as Walmart and Kmart cannot operate their own company-owned pharmacy counters in North Dakota. This means the widely publicized $4 generic prescription drug offers of a number of national retailers are not available in North Dakota.

What has become known as the pharmacy-ownership law was written back in 1963. Essentially, with the law in place as it is, there is a government-protected monopoly in place for the independent drugstore owners of this state.

I am not saying you should not patronize the local merchants of your city. If you are getting good service at a fair price from your local hometown drugstore, then, absolutely, you should keep your business there.

There is a privately owned pharmacy in the Walmart store on 13th Avenue South in Fargo. However, it is not a Walmart-owned pharmacy. The owners of that pharmacy are merely leasing space from Walmart. As such, that pharmacy is not able to offer or honor Walmart’s much-advertised $4 and $10 generic prescription prices.

A statewide grass-roots group took the lead in raising public awareness about this unfair law in North Dakota. It unsuccessfully tried to get the law changed during the 2009 regular session of the North Dakota Legislature. The group then proceeded to sponsor an initiated measure petition drive to force this issue onto the Nov. 2, 2010, general election ballot. Unfortunately, due to a paperwork discrepancy in their petition filing with the secretary of state, the measure was declared invalid.

How in the world would a majority of the members of both houses of the North Dakota Legislature be on record as supporting the current law? It is unbelievable, but they are. The bill that was defeated in the House of Representatives during the last regular legislative session received 35 votes in favor of repealing the pharmacist-ownership requirement.

It is my understanding that the pharmacy-ownership law issue may make a reappearance during the 2011 legislative session, which is slated to get under way Tuesday in Bismarck. I hope this time around, lawmakers will see the wisdom of changing this law and vote to do just that.

It is my hope that lawmakers will take notice that 14,000 North Dakotans supported the grass-roots group’s efforts by signing the petition that requested that the measure be placed on the ballot. Hopefully, the members of the House of Representatives and the Senate will see that fact as something of a mandate and that the Legislature will vote to change this law.

This time around, should the Legislature again either refuse to consider legislation to change the pharmacy-ownership law or if a bill is introduced and is defeated, I have no doubt that another initiated measure campaign will begin and that North Dakota’s voters will have their say on this important issue.

Thanks to the wording of the current law, two retail drugstore chains have been allowed to operate in North Dakota – CVS Pharmacy (CVS acquired Osco Drug many years ago) and Thrifty White Drug. Both of these companies are out-of-state corporations. Thrifty White is based in the Twin Cities suburb of Plymouth. CVS is based in Woonsocket, R.I.

Both Osco Drug (now CVS) and Thrifty White were in business when the law changed in 1963. Accordingly, these two companies are operating essentially under versions of a grandfather clause provision in the law. Since Thrifty White is employee-owned, that company is able to demonstrate that all of their store locations in North Dakota are owned at least 51 percent by a licensed pharmacist. Accordingly, all of Thrifty White’s locations in North Dakota are in full compliance with the current law.

Accordingly, I would encourage you to contact your members of the North Dakota House of Representatives and the North Dakota Senate and encourage them to support legislation that would repeal this unfair and anti-competitive law.

Olson is an occasional contributor to The Forum’s commentary pages.

E-mail at rickolson@cableone.net.