Community Pharmacy Turnover and Context of Openings and Closings by Ownership Type.

Importance: While community pharmacies provide many valuable prescription and professional services, they are also retail businesses. Evaluating pharmacy closures through the lens of a retail business framework may provide more context on what is happening in this industry and identify potential solutions to address closures and/or shortages.

Objective: To evaluate community pharmacy turnover (openings and closings) in the US over time and by ownership type.

Design and setting: This cross-sectional analysis of all community pharmacy openings and closings in the US from 2010 to 2023 used pharmacy-level data from the US National Council for Prescription Drug Programs database. National-, state-, and county-level turnover was assessed using economic indicators of business dynamics, such as total population, population growth, household income, total firm changes for all industries, and net job creation.

Exposures: Pharmacy class type defined as either a chain pharmacy (4 or more pharmacies under common ownership) or an independent or franchise pharmacy using the US National Council for Prescription Drug Programs classifications.

Main outcomes and measures: Pharmacy turnover rate from 2010 to 2023, calculated as the sum of pharmacy openings and closings over the full study period divided by the total pharmacies in the market at the beginning of the period (2010).

Results: The analyses found that US pharmacy market turnover rate for this 14-year period was 86.8% (52 974 total openings and closures of 61 054 total pharmacies in 2010) or 6.2% annually. When comparing across pharmacy types, independent pharmacy turnover was substantially higher (152.7%) than chain pharmacy turnover (49.9%) across the entire US. Counties with high turnover were associated with net increases in pharmacies from more independent pharmacy openings over the period. Turnover rates for all businesses were higher in counties with both low and high pharmacy turnover, even when adjusting for population size.

Conclusions and relevance: This cross-sectional study found that the community pharmacy market in the US has an annual turnover rate of approximately 6.2%, with independent pharmacies opening and closing more frequently than chain pharmacies.