eDrugstores: Drugstore.com, PlanetRx and Soma Message Board

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Technology Stocks : eDrugstores: Drugstore.com, PlanetRx and Soma

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To: astyanax who wrote (58)	4/24/1999 11:02:00 AM
From: Tom D	Read Replies (1) of 254

As I think about this, it is a tough business. Peter Patient presents prescriptions. Probably postally. eDrugstore has to call the doctor to confirm that it is for real, has to call whatever PBM Peter thinks he has, to get it adjucticated, and then has to contact Peter and tell him that this is how much it would cost, and does he still want to get it filled and then run it through mastercard. Consider how much easier AMZN has it. The customers do all the order entry and all they have to do is run it through the credit card company. ESRX has it easier since the prescription data is already electronically formatted and they are already doing adjudication. But physicians and patients despise ESRX as they go around forcing doctors to switch their prescriptions for apparently arbitrary reasons. Its all about the hoary secret rebates ESRX gets from Big Pharma. It remains to be seen whether patients would voluntarily buy anything from ESRX. Maybe the competing eDrugstores will have to educate patients about rebates and physician coercion. Still, the opportunity is breathtaking. These eDrugstores are selling generic medications at about one-third the price of land-based Walgreens and still making gross profits. My father bought WAGS last fall on the morning after the market tanked in a panic over the Asian flu. He bought it because it was a domestic business which would not suffer from declining foreign demand and because it would benefit from lowered prices from its foreign suppliers. He got about a double on the stock. He sold it, at my recommendation, a couple weeks ago when Drugstore.com cut its generic prices again. Land-based drugstores will no longer be able to enjoy obscene margins on generic drugs. They will become priced as commodities. Best Regards, Tom

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