MISSISSAUGA, Ont. — The Rexall drug store chain says it will impose a hiring freeze at its corporate head office and will begin charging for prescription drug deliveries at its Ontario pharmacies starting next Monday.
The moves come in the wake of provincial government plans to cut generic drug costs in Ontario by reducing payments from drug makers to pharmacies.
Rexall CEO Andy Giancamilli says the government actions have forced the company to review its business model as well as its operations and future investment plans in Ontario.
Today’s cuts also include eliminating pharmacy student and intern programs in the province effective immediately.
Rexall is the flagship pharmacy for Katz Group Canada, the private Edmonton-based drug store operator.
Shoppers Drug Mart (TSX:SC) has already cut store hours and streamlined seven of its stores in the London area of southwestern Ontario.
Some analysts estimate the proposed drug cost changes could reduce revenues by $1 billion a year at Ontario’s drug store industry.