
DATE: Thursday, August 7, 1997              TAG: 9708070496

SECTION: FRONT                   PAGE: A1   EDITION: FINAL 

SOURCE: BY STEPHANIE STOUGHTON, STAFF WRITER 

DATELINE: RICHMOND                          LENGTH:   83 lines

PROBATION, FINE URGED FOR ECKERD

``Every Eckerd customer has a right to expect better than what we provided in these early days.''

- Eckerd official Robert W. Hannan

A state pharmacy committee said Wednesday that Eckerd Corp. should be allowed to continue operating its 113 Virginia drugstores.

But the three-member panel recommended that Eckerd be fined $547,000 and be placed on probation for violations at the Virginia pharmacies.

About $447,000 of those fines would be waived if Eckerd puts more complete prescription records into its computers within a certain time frame.

That would leave Eckerd with a bill of $100,000 - which would represent, on average, less than half of what the retailer makes in one day at all of its stores.

The Florida-based division of J.C. Penney Co. Inc. had sales of $5 billion last year and earned $93.5 million.

The decision of the state Pharmacy Board committee came after a lineup of pharmacists and state inspectors described scenes of chaos at the former Revco stores, which Eckerd took over in mid-June.

``We'd go home in tears,'' Charlotte Catarsi, an Eckerd pharmacist in the Petersburg area, told committee members. ``I felt like I was on my own.''

Since the buyout, customers have complained of prescription mistakes, medicine shortages and long delays at Eckerd's new pharmacies. Pharmacists accustomed to Revco's sophisticated computer network said they were provided with four months' worth of prescription records on microfiche.

State law mandates that two years of records be transferred.

But in a statement, committee members said they were convinced that the confusion had subsided. They also heard from Eckerd officials who said they had already been battered enough.

``Obviously, Eckerd has been hurt to some extent already by its own circumstances,'' said Peter Mellette, the company's attorney.

Anxious to grab some of Eckerd's sales, competitors have taken aim. A recent newspaper advertisement by Rite Aid says: ``When the government questions the safety of your drugstore, shouldn't you?''

Wednesday night, Eckerd officials appeared to be satisfied with the committee's recommendations, though they would not say if they would sign a consent order agreeing to the stipulations.

``We are . . . pleased that the board has recognized that we have made significant improvements,'' said Robert Hannan, an Eckerd vice chairman. Earlier he had said: ``Every Eckerd customer has a right to expect better than what we provided in these early days.''

The committee's suggestions, however, aren't etched in stone. The full Pharmacy Board, which meets Aug. 19, can reverse the board's decision or tack on other fines.

The full board could still deny Eckerd permits to operate the Virginia pharmacies, essentially booting the retailer from the state. Eckerd did not immediately apply for the permits, even after reminders from the state agency.

Two other chains linked to Eckerd's struggles in Virginia also face state scrutiny. Revco D.S. Inc. and its new owner, Woonsocket, R.I.-based CVS Corp., did not provide Eckerd with complete prescription records.

To satisfy federal antitrust concerns, CVS agreed to sell 113 of Revco's 234 Virginia drugstores to Eckerd. The spinoff was announced May 30.

Seventy-nine of Eckerd's new stores are in Hampton Roads; the remainder are in the Richmond, Petersburg and Charlottesville areas.

CVS and Eckerd officials blamed computer problems that couldn't immediately be solved. They also have blamed time constraints on the merger.

But panel member Sonny Currin questioned Eckerd's priorities.

``Was the sale so important for you to get yourself in this position?'' he asked. ILLUSTRATION: Graphic

THE PROPOSAL

Eckerd would receive one-year probationary permits to operate 113

Virginia stores acquired from Revco in June. Eckerd would be fined

$100,000, and up to 20 of its stores would be subject to unannounced

inspections.

THE REASON

Eckerd customers have complained of prescription mistakes and long