The small-town drugstore closed for the last time on a clear and chilly afternoon in February. Jon Jacobs, who owned Yough Valley Pharmacy, hugged his employees goodbye. He cleared the shelves and packed pill bottles into plastic bins.

Mr. Jacobs, a 70-year-old pharmacist, had spent more than half his life building his drugstore into a bedrock of Confluence, Pa., a rural community of roughly 1,000 people. Now the town was losing its only health care provider.

Obscure but powerful health care middlemen — companies known as pharmacy benefit managers, or P.B.M.s — had destroyed his business.

This has been happening all over the country, a New York Times investigation found. P.B.M.s, which employers and government programs hire to oversee prescription drug benefits, have been systematically underpaying small pharmacies, helping to drive hundreds out of business.

The pattern is benefiting the largest P.B.M.s, whose parent companies run their own competing pharmacies. When local drugstores fold, the benefit managers often scoop up their customers, according to dozens of patients and pharmacists.

Image

Jon Jacobs packed up medicine on the day he closed his pharmacy in February. Credit...Jeff Swensen for The New York Times

Image

Mr. Jacobs hugged an employee. Credit...Jeff Swensen for The New York Times

Newly Created Deserts

Nearly 800 ZIP codes that had at least one pharmacy in 2015 now have none.

Pharmacy deserts

Newly created

– Lost all pharmacies since 2015

Darrington, Wash.

– No pharmacy in 2015 or now

Existing

Currently has at least one pharmacy

Harmony, Minn.

Confluence, Pa.

Each circle

represents

a ZIP code

Pharmacy deserts

Newly created

— Lost all pharmacies since 2015

Existing

— No pharmacy in 2015 or now

Currently has at least one pharmacy

Darrington, Wash.

Harmony, Minn.

Confluence, Pa.

Each circle

represents

a ZIP code

Notes: The data reflect closings of both chain and independent pharmacies. The map compares deserts on July 31, 2015, with deserts on Sept. 30, 2024. The Census Bureau tracks more than 33,000 ZIP codes.

Source: Luke Slindee analysis of pharmacy data

By Karl Russell

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