Business
Shoppers Drug Mart Corporation Responds to Ontario Government Announcement Regarding Drug Reform
Shoppers Drug Mart Corporation Responds to Ontario Government Announcement Regarding Drug Reform
About this update from Serrano Resources Ltd.
[{"type":"text","content":"\n\n\n\nTORONTO, Apr. 7, 2010 (Canada NewsWire Group) -- /CNW/ -- Shoppers Drug Mart Corporation (TSX: SC) today responded to the Ontario Liberal Government's announcement with respect to plans for further drug reform in the province.As part of the announcements, the Ontario Liberal Government indicated that generic prescription drug prices for patients under the Ontario Drug Benefit Program would be reduced from the current level of 50% of the equivalent brand name price for multi-source generic prescription drug products to 25% of the equivalent brand name price. The announcement also indicated that planned reductions in generic prescription drug pricing would also be extended to the private sector over a multi-year period.The Company is in the process of reviewing these announced changes to assess their impact on its sales and profitability. At this time, it is too early to draw specific conclusions. Part of the Company's review of these announced changes will include the further development and subsequent implementation of contingency plans for its own business and service model in order to ensure that it can continue to generate a fair and adequate return to fulfill its obligations to all stakeholders, including its Associate-owners, employees and shareholders. As a result of today's announced changes to the Ontario drug system, the Company will also be undertaking a review of its longer-term strategic priorities and initiatives. As well, the Company will also be reviewing its previously issued expectations for comparable prescription sales growth in fiscal 2010, which did not fully contemplate the extent of the announced changes to the Ontario drug system. The Company will report its First Quarter Financial Results on April 28, 2010 and it is expected that further information will be provided at that time.The Company is strongly opposed to the changes announced today and believes that they will have a direct negative impact on pharmacy services and patient care in the Province of Ontario. The plan indicates an unreasonably low rate of reimbursement compared to what was proposed by community pharmacy, suggests that the Ontario Liberal Government will further interfere in the commercial relationships between generic manufacturers and pharmacies, and that this government will play an increased role in the regulation of privat...