COVID shot scheduling complicates drugstore operations
While millions of coronavirus vaccine doses are available, it could be months until anyone can just walk into their local pharmacy for a dose, a frustrating situation for big chains like Walgreens Boots Alliance Inc. and CVS Health Corp., as well as their customers.
People still need to make appointments online or over the phone to get vaccinated at drugstores, a policy designed to prevent crowds from forming and help pharmacists manage scarce supplies. The system isn't working optimally and is unlikely to change anytime soon, said Rina Shah, Walgreens vice president of pharmacy operations.
That could hold back sales for drugstores that rely on back-of-the-store pharmacy purchases to drive front-of-store sales of higher-margin items, like beauty products. Masking and social-distancing measures have already hurt the market for cold and flu products, and shots would be another way to get customers in the door.
"I'm hopeful in the future it will become a normal thing where you can go into any pharmacy and get a vaccine," Shah said. "It's just ... we're a little further away from that right now."
Walgreens, CVS and other drugstores and chains that receive vaccine directly from the government offer more than 40,000 locations to help immunize every American 16 and older. The problem is finding an appointment at one of them, an ordeal that's been compared to "The Hunger Games," a dystopian series about children who are forced to fight to the death on television.
Bookings are snapped up the minute they appear. Websites dedicated solely to simplifying the search process have cropped up.
"That's how much demand is out there," Shah said. "Unfortunately for many of the patients that are out there, it's not ideal."
It's another in a series of headaches for drugstores that have seen panic-buying of items like toilet paper and toothpaste abate. Patients are avoiding clinics and doctors' offices, meaning prescriptions are down.
The mild cold and flu season this winter hammered sales of over-the-counter remedies at Rite Aid Corp. by 37%, the company said last week. Walgreens executives similarly warned about weakness in the therapies' sales during the company's January earnings call. Walgreens investors will see what came to pass Wednesday when the company reports quarterly results.
Coronavirus vaccines are moneymakers on their own since pharmacies get paid for administering shots. Administering them could plug some of those holes and lure customers both new and old.
That makes the appointment roulette especially crucial for pharmacies. It should become easier to find one when Walgreens receives more doses, Shah said. CVS anticipates there will be enough shots for the country starting May 1, consistent with President Joe Biden's estimates, said Sreekanth Chaguturu, chief medical officer of CVS's pharmacy-benefit manager Caremark.
Wall Street has sensed the opportunity. Walgreens shares have already risen 33% this year through Monday, Rite Aid's stock jumped 20% and CVS shares have climbed 12%. The gains follow lackluster performance in recent years and Amazon.com Inc.'s growing presence in the pharmacy space.
Even when shots are plentiful, online registration will remain a key element of getting vaccinated at CVS to keep the process orderly.
"At this time, we see digital scheduling as an important way to ensure a seamless and safe experience for the patient," Chaguturu said.