Leedahl blames PBMs, the Pharmacy Benefit Managers who control pricing, strip profits and end contracts
by Jim Boyle
Elk River residents were shocked and dismayed to learn this week that Kemper Drug was closing and there was nothing they could do about it.
Deborah Leedahl, owner of the pharmacy and gift shop in downtown Elk River, told the Star News there were a lot of factors that went into the decision to close, but the primary reason is pharmacy benefit managers who have been chipping away at her profits for years. The last straw came Jan. 1 when one of them kicked Kemper out of a network.
“That was about 20% percent of our pharmacy business,” Leedahl said.
The pharmacy closed on Wednesday, March 16. Client records have been sold to Walgreens and they have been transferred there and remain intact. The choosing of Walgreens was her decision, but the news of the closing could not be public until everything was finalized.
“A handful of people have been upset that they were not notified sooner,” Leedahl said. “I couldn’t let people know before everything was done and it became public.”
By Wednesday, all of the contents of the gift shop had been marked down 50% off. The last day the gift shop will be open is today (Saturday, March 18).
Longtime residents and other shoppers milled around the store on Wednesday in a fog of disappointment and sadness.
“It’s sad,” said LuAnn Suilmann, of Elk River. “We switched from UCARE to Blue Cross when we couldn’t use UCARE here anymore. We wanted to stay with Kemper.”
Leedahl and Kemper staff have been hearing from people all week who said they trusted Kemper to take care of them and their family.
“It’s really sad they are pushing to take the options away from people,” Leedahl said. “I always believed in competing on service. I thought if we provided the best service and convenience that people would choose our pharmacy over the other options and they do. That’s 100 percent true.
“It’s hard when people’s insurances mandate them to (select)something other than the pharmacy of their choice.”
Kemper’s closure wasn’t the ending that Leedahl drew up when she bought the pharmacy in 2017 with the hope of running it until she retired many years from now.
She was only 37 years old then. She’s now 43 and unsure if she will remain in her chosen profession.
“It’s part of my identity,” she said. “I am a pharmacist. That, too, is heartbreaking. Maybe I won’t be a pharmacist anymore.”
Her next step after this weekend will be to sell the building.
“I want it to continue to be an icon,” Leedahl said of her hopes of finding someone with an exciting venture. “I don’t want it to be another whatever. I am hopeful someone will come to me with something cool and interesting and iconic that they want to put in there.”
The Dayton woman said she heard from a number of people who are interested in the building.
“I am hoping someone will be able to do something fun and provide the next awesome corner for whatever it is,” she said.
She is also looking for a loving home for the neon sign that is perched outside the business.
“Many have reached out to ask if they can care for it.,” she said. “I am planning to find it a good home.”
After taking care of these types of details she plans to take some time off and figure out the next chapter of her life.
“I am heartbroken,” Leedahl said. “As a pharmacist the dream job is to own your own pharmacy. When I resigned from my last job, I told my boss I was buying a pharmacy. ‘Oh my god,’ that’s like every pharmacist’s dream,’ she said to me. She was so excited for me and I was excited.”
Kemper has been a landmark in Elk River for more than 70 years. The Elk River drug store was founded in 1948 by Robert Kemper. The building has stood proudly on the corner of Jackson Avenue and Highway 10 in downtown Elk River for several generations.
People have been mourning the loss of the landmark business.
“The loss of Kemper Drug is a sad one for our community,” said Lance Lindberg, a longtime resident and chair of Elk River’s Heritage Preservation Commission. “Although the ownership has changed hands a couple of times, it was one of the oldest continuing operating businesses in Elk River. When it first opened, it was the only pharmacy in Elk River and remained so for several decades and therefore almost everyone who lived here back then had reason to visit it at some time.”
Lindberg said it also had what was known as a soda fountain which had a counter and stools and served various ice cream treats to customers along with such specialties as cherry Cokes, which were very popular with the teenagers who often gathered there.
“Kemper’s was one of the most iconic places in Elk River and holds special memories for many people,” Lindberg said.
Downtown Elk River Business Association held its regular monthly meeting this past week. There was a sense of sadness among the group in seeing one of their own closing down.
“Kemper Drug and Gifts has been a staple in our downtown for years,” said Deanna McLean, president of DERBA. “It was a place where when you walked in the door, they knew exactly who you were. The small-town feel.”
DERBA members expressed how they wanted to let Deborah know they loved having her active with their DERBA family and appreciated all she has put into the downtown community.
“We are going to miss her and Kemper Drug and Gifts, for sure,” McLean said.
Leedahl told the Star News she loved participating in the downtown group.
“It was motivating,” she said. “It was a really good experience. It was fun to have neighbors and business owners that all wanted the best for downtown and the best for our community and wanted to be a destination for people to go shopping, to eat, to go trick or treating and to try to preserve that value. How awesome that we have so many businesses that want that. It’s not commonplace anymore.”
She said for the small, independent pharmacies, PBMs are the culprit behind the loss of pharmacies across America. She said they routinely pay pharmacies below their acquisition costs.
“If they can abuse us in this way, threaten to pull our contracts and accuse us of things we didn’t do, is this really an environment where we have any hope of being successful,” Leedahl asked. “If we sue them and win, what’s to stop them from doing the same thing the next day?”
Had Leedahl stayed in business, she was facing certain staffing cuts and a fate she struggled to conceptualize.
“It’s not right,” she said. “People should know why we had to close, because of the way PBMs have chosen to pay us. There is nothing we can do about it.”
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