(CNSNews.com) - Not only are oil prices coming down, just as the heating season cranks up -- but so are drug costs.
Wal-Mart announced on Thursday that it would start selling reduced-price drugs "in as many states as possible" next year. Target announced that it would match Wal-Mart's cheaper drug prices.
Financial analysts said Wal-Mart's move is expected to cut into other pharmacies' profit margins.
According to the Bloomberg News Service, Wal-Mart is cutting prices in one of the most profitable sectors of the pharmaceutical industry. Profit margins for drug stores average between 10-15 percent for brand-name drugs and 30-40 percent for generics, Bloomberg quoted one analyst as saying.
Although Wal-Mart is lowering the cost of generic prescription drugs, Wal-Mart's union-backed critics are not letting up, even though union workers are among those who may benefit.
"While lowering prescription drug costs is a good thing, Wal-Mart cruelly ignores the fact that it fails to provide company health care to over half (775,000) of its employees, which leaves 46 percent of its workers' children uninsured or on public health care," said Paul Blank, the campaign director for WakeUpWalMart.com.
The group says Wal-Mart "wants the American people to ignore the fact [that] its so-called low prices come at a high cost to its workers, children, and their families. Wal-Mart needs to answer one very simple, but serious question -- why not just improve the health care coverage of its employees?"
According to Blank, Wal-Mart's "heath care crisis grows everyday, and sadly this prescription drug initiative will not insure one additional Wal-Mart employee, one uninsured child, or reduce the billions of cost for taxpayers."
Wal-Mart leading the way
A pro-Wal-Mart group -- formed to counter the negative messages put out by labor unions -- says Wal-Mart will be helping millions of Americans who struggle each day with the rising cost of medicine.
Catherine Smith, interim chair of the Working Families for Wal-Mart National Steering Committee, congratulated the retailer for choosing to "step out and lead on a difficult issue."
"Like the $2,300 Wal-Mart saves the average American household each year, this program will put money back in the pockets of working families and, more importantly, give tens of millions of Americans a better chance for a longer and healthier life."
Smith added that it is "beyond explanation" why union leaders -- who claim to advocate on behalf of working families -- would attack an effort to make prescription drugs more affordable.
According to Smith, the $4 pricing will be available to all pharmacy customers with a prescription from a doctor that can be filled with a covered generic medicine. The cheaper costs will be available to people with and without insurance.
The program will cover 291 generic medications, including those used to treat and manage conditions such as allergies, cholesterol, high blood pressure and diabetes. Some antibiotics, antidepressants, antipsychotics and prescription vitamins also are included.
The program will be available statewide in Florida in January 2007, and will spread to other states after that.
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