A third-generation family business, Buchanan Brothers Pharmacy Inc. announced Thursday it will close its locations in Eldred, Smethport and Coudersport upon their sale to Rite Aid Corp.
In a statement shared with The Era, owner Christie Keglovits said, “It is with mixed emotions that we announce the sale of three of our locations to Rite Aid. It was a decision we did not reach lightly. Due to poor insurance reimbursement, independent pharmacies across the country are being forced to close their doors. Pharmacy organizations representing all sectors of retail pharmacy have been aggressively asking legislators to address these issues with the pharmacy benefits managers (PBMs) for quite some time. Unfortunately, they have been slow in taking action. It simply is not a sustainable business model when total reimbursement is less than the costs we pay for medications.”
Keglovits explained the issue is not unique to Buchanan Brothers, McKean County or even Pennsylvania.
“Unfortunately you are seeing this across the country. Every retail pharmacy out there has been sounding the alarm for four to five years that this was coming.”
Keglovits said Buchanan Brothers is a dues-paying member of the Pennsylvania Pharmacists Association, which lobbies on behalf of independent pharmacies like theirs.
The Buchanan Brothers sites in Westfield and Elkland will continue business as usual. Keglovits said those locations will remain open due to a more-diverse payor mix in Tioga County.
“In McKean and Potter counties we are so narrow with our payor mix,” she said. “Everyone in this neck of the woods is UPMC, Express Scripts and Highmark, which is processed through Express Scripts, a very poor payor.”
Buchanan Brothers prescriptions will be transferred automatically and no customer action is required. All prescriptions from the Eldred and Smethport locations will transfer to Rite Aid in Port Allegany and all prescriptions from its Coudersport pharmacy will transfer to the Rite Aid there.
The Smethport location will close April 8, Eldred on April 9 and Coudersport on April 10.
The closures leave Eldred and Smethport without a local pharmacy, and impact approximately 30 employees. Keglovits explained a condition of the sale was that Buchanan Brothers employees would be guaranteed an offer of employment with Rite Aid.
“We’re very thankful our employees are being taken care of. Our employees are the reason we’ve been so successful.”
Rite Aid Corp., based in Philadelphia, is an American drugstore chain founded in Scranton in 1962. It is the third-largest drugstore chain in the U.S., with more than 2,000 stores.
Keglovits had held the company for “going on 25 years,” Keglovits said. “I’m third generation.”
The business began with her grandfather, Charlie Buchanan, who worked at Smith’s Drug Store in Coudersport.
“When Mr. Smith died, he left it to my grandfather. In honor of Mr. Smith, he kept it Smith’s Drug Store,” Keglovits recalled.
When Charlie died unexpectedly in 1976, Keglovits’s dad and two uncles took over.
“Then it was my sister and my cousin and I, then my cousin retired and another cousin stepped in,” she said.
Her father and uncles left the store as Smith’s for about five years before incorporating it and changing the name to Buchanan Brothers Pharmacy in 1981. All told, the pharmacy has been in the family for close to 75 years.
Keglovits said Rite Aid is committed to serving “rural populations with high rates of Medicare and Medicaid coverage, which leave pharmacies more susceptible to DIR fees.
“Unfortunately, that’s the reality of it,” Keglovits said. “Until something gets done it’s just a matter of time until there are no independent pharmacies out there. We tried to hold out as long as we could.
“We sincerely appreciate the support of our valued patients over the past several decades. It has been a privilege to serve you.”
