Why CVS Charges $133 More Than Costco for Generic Lipitor

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 Pfizer Inc. Lipitor is arranged for an illustration  (Photo by Jb Reed/Bloomberg via Getty Images)
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By Emily Jane Fox

CVS (CVS) charges $150 for a monthly prescription of the generic version of the cholesterol drug Lipitor. The same drug goes for $17 at Costco.

That's according to a recent Consumer Reports nationwide survey that sent secret shoppers to 200 pharmacies that carry five blockbuster drugs: Lipitor, Lexapro, Plavix, Actos and Singulair, all of which lost their patents in the last two years.

Shoppers found they could be paying as much as $749, or 447%, more for a generic prescription drug in one year at the highest-priced pharmacy, compared with the lowest.

The priciest places to pick up these prescriptions were CVS, Target (TGT) and Rite Aid (RAD). The least expensive were Costco (COST) and Sam's Club, while Walmart (WMT), and Walgreen's (WAG) fell in the middle.

So what's behind the huge discrepancy?

Lisa Gill, a Consumer Reports editor who focuses on prescription drugs, said the difference stems primarily from what sells at the stores.

"At places like CVS or Rite Aid, the pharmacy is their major source of revenue and profit," she said. "Costco and Sam's Club are using the low drug prices to pull people in stores who will spend money on other things."
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Consumers are often willing to pay higher prices at a drug store because many of them are conveniently located, open 24 hours a day and have drive-through windows, according to Gill.

But for most people, it can be worth the extra hassle. This is especially true for those who take medication long-term, since they will get better deals at the warehouse clubs, or big box stores, Gill said.

Carolyn Castel, a spokeswoman for CVS, said that pricing surveys like this are too small to draw "meaningful conclusions about which pharmacies offer the best overall value." She also noted that they don't take into account the discount and third-party insurance programs that pharmacies use to lower prices.

A Target spokeswoman said it offers a number of ways for customers to save on drug prices, like rewards and discount programs.

Consumer Reports' Gill said these programs are helpful, but they're not doing enough to lower costs.

It's no secret that the cost of drugs can be prohibitive, especially at a time when incomes are stagnating. Consumer Reports found in a separate national telephone survey that Americans who regularly took prescription drugs, spent $758 out of pocket in 2012, or 12% more than the previous year.

Gill said that one way for people to save is by refilling prescriptions every 90 days instead of each month, since most pharmacies provide discounts on three-month supplies.

To get the best price, she said, people should comparison shop by calling different pharmacies to see who offers the lowest price.

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Your Child Is Sick. You Need to Work. What Now?
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Why CVS Charges $133 More Than Costco for Generic Lipitor

The ability to work from home is a lifesaver, for those who have that luxury. If your job requires you to be at the workplace, then it's essential to have a game plan in place before junior shows those first signs of the sniffles.

Network with parents you know to find the right babysitter. Interview candidates and then "hire" at least three with different schedules so you have the flexibility to find someone on short notice. Prospects can be located anywhere: school, work, the neighborhood, or local organizations like clubs, churches, and so on. Cast a wide net during the summer season and pick your list before the first day of school begins.

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Germs don't wait, but every doctor's office has a waiting room. Don't let an urgent situation push you to see just any doctor who's available on short notice. Pick a pediatrician and then get to know the nurses as well as you can. That way, you'll be more likely to get to the right caregiver quickly. You'll also avoid paying two, three, or 10 times as much for visiting doctors outside of your insurance plan's approved network.

You make arrangements for your kids to meet obligations when taking time off for vacation during the school year. Why not use the same strategy when junior gets a bellyache? Talk with your child's teachers about what they allow in terms of working at home. Are assignments posted online? Can scanned work be sent via email? How about one-on-one instruction via Skype or instant messaging? Get creative in thinking about tools.

Once you have a plan, execute it. Get a family computer. Or, if your child is old enough to have a PC or iPad, make sure you have a good Internet connection and proper software for submitting work online. Don't rush the process; you can buy what you need a little at a time using discount sites or a good cash-back card if you're debt free. Either way, communicate your intent to your child's teachers. Having the right equipment at home shows you are serious about your children's education, while teaching kids that sick time isn't playtime.

No parent can ever be in two places at once -- especially a working parent with bills to pay. Yet even if we can't be there when our kids are sick, we can create environments for others to nurse our kids back to health and help them meet their schoolwork obligations -- and we needn't break the bank to do it.

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