The Annual Meeting of the National Association of Chain Drug Stores now under way in Scottsdale, Ariz., promises to be exceptional — for a variety of reasons not connected to the program or the current issues facing the association or the chain drug industry.


National Association of Chain Drug Stores, NACDS, Annual Meeting, 2011 NACDS Annual Meeting, chain drug industry, David Pinto, Tom Ryan, CVS Caremark, CVS, Larry Merlo, CVS CEO, chain drug retailing, Mary Sammons, Rite Aid, John Standley, chain drug community, Joe Magnacca, Duane Reade, John Lederer, Walgreens










































































































































































































































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Inside This Issue - Opinion

An exceptional Annual Meeting unfolds

April 25th, 2011
by David Pinto

The Annual Meeting of the National Association of Chain Drug Stores now under way in Scottsdale, Ariz., promises to be exceptional — for a variety of reasons not connected to the program or the current issues facing the association or the chain drug industry.

More ­specifically:

• The 2011 NACDS Annual Meeting marks the last such event that Tom Ryan, who recently stepped aside as chief executive officer of CVS Caremark, will attend. So ends a 19-year presence at these events that began in 1992, when Ryan, then in charge of pharmacy at CVS, attended his initial Annual Meeting, in Maui, Hawaii. During that period he came to exert an indelible influence on the organization, particularly during his year as NACDS chairman in 1997/98, when, in the wake of Ron Ziegler’s sudden departure from the Annual Meeting in Palm Beach, Fla., Ryan, much to his surprise and chagrin, instantly became the meeting’s pivotal player and focal point.

This Annual Meeting is, then, a milestone of a different nature, a time of transition for the man and his company. During his tenure as CVS CEO Ryan was arguably the chain drug industry’s single most compelling personality, the executive most sought-after by suppliers and even competitors, the commanding presence whose movements were avidly followed and whose opinions were eagerly sought and evaluated, the socially compelling personality who, with his irresistible wife, Cathy, formed the core of the A-listers who enlivened any NACDS social event.

Now Ryan is taking his final lap as an NACDS and industry presence. He will, once again, be a center of attention — especially for those industry people he has come to know and who, in turn, have come to know and admire him. But he will no longer be the center of attention. And a year from now, at the NACDS Annual Meeting in Palm Beach, he will be merely a footnote — just another line in the NACDS list of past chairmen. Such is the fleeting glow of fame and success in chain drug retailing — no matter how brightly that glow, in its time, lights up the industry.

• With Ryan’s departure comes Larry Merlo’s arrival. In truth, he arrived last year when, as president of the CVS/pharmacy drug chain, he was named NACDS chairman. Now his tenure as chairman ends — as his career as CEO of CVS Caremark ­begins.

Merlo, accidentally or not, is a brilliant choice to succeed Ryan at the pinnacle of the chain drug industry. Unlike his charismatic predecessor in many ways, he nonetheless possesses a charisma all his own, one manifested in a quiet self-assurance that is impressive is its ability to communicate feelings of warmth and confidence. Even now he has acquired a level of respect and admiration that usually comes only with time.

The fact that Ryan will walk away from CVS after serving for a brief time only in the role of chairman can only help Merlo. Then too, Ryan’s open and sincere regard for his successor will help as well, as Merlo tackles one of the two most important assignments in chain drug retailing. So the symmetry of the departure of Tom and Cathy Ryan and the arrival of Larry and Lee Ann — known to some of her friends as Evelyn — Merlo is complete. It is also very much in the nature of business in America — business at its best.

• The 2011 NACDS Annual Meeting will also mark the last appearance at these events of Mary Sammons, until recently Rite Aid’s CEO. Though Sammons remains chairman of the drug chain, she is very much removed from the retailer’s day-to-day operations, that job having been handed over to John Standley. However, along with Tom Ryan, Sammons has become an iconic figure in the chain drug store community. More to the point, where Ryan is admired, Sammons is loved — if that emotion has any relevance to an executive position in America’s business ­community.

Sammons has been a unique figure in the chain drug community — however uniqueness is defined. In addition to abundantly displaying those much-valued business attributes of intelligence, dedication and hard work, she has been uncommonly open and accessible to all manner of industry people — employees, suppliers, competitors, the NACDS hierarchy. She has repeatedly demonstrated a unique ability not only to listen but to learn from others — and to act on what she’s learned. Then too, she really cares — about her industry, the issues that surround that industry and, most impressively, the people who influence and bring concern, commitment and compassion to those issues.

As with Ryan, this will be the last time Sammons attends an NACDS Annual Meeting. Like Ryan, she will become merely a line of type whenever a list of past NACDS chairmen is presented. Perhaps her final days will, like Ryan’s, be punctuated by a last recognition or two. But for the legions who have come to know, admire and, yes, love her, Mary Sammons will always be mentioned when the best of chain drug retailing is discussed.

• If Larry Merlo has already arrived as a chain drug figure of importance, John Standley, Rite Aid’s new chief executive, has yet to do so. That’s not Standley’s fault. Internally, he has already shown himself to be a highly capable, results-oriented CEO. But he has yet to make a significant impression, one way or the other, on the chain drug community.

Competitors, having met him when he joined the NACDS board last year, are only now becoming comfortable with him. He remains largely unknown in the supplier community, a community that embraced his predecessor. It is possible, indeed likely, that Stanley has been too busy with the stressful and time-consuming business of running Rite Aid to worry about suppliers. But, as Sammons would tell him, his company has no more important advocate or business partner than those companies that have, in the past, more than once brought the nation’s No. 3 drug chain back from the brink.

If Sammons is to provide one more valuable service to the chain drug industry before she leaves the stage, it would be to ensure that John Standley is the person the industry first thinks of when Rite Aid is discussed. But that’s asking a lot — both from Sammons and from ­Standley.

In the end, the burden of winning recognition and respect will fall only to one person: John Standley. The people who have come to know him during his brief tenure as Rite Aid CEO believe he will be more than equal to the occasion.

• Finally, the 2011 NACDS Annual Meeting will mark the first appearance of Joe Magnacca on the national stage that is chain drug retailing in America. True, he’s been here before, as one of the two forces — John Lederer is the other — behind the remarkable resurgence of Duane Reade. But this time he comes to Scottsdale as the head of merchandising and marketing for Walgreen Co. He is the first person since the departure of the legendary Vern Brunner 10 years ago to hold those two titles simultaneously. As such, his importance to his company — and to the wider world of chain drug retailing — cannot be overstated.

Magnacca comes to this job and this meeting with a degree of respect and popularity that is almost without precedent at his level in the chain drug community. It derives in part from the success he achieved at Duane Reade. In larger measure, however, it is in recognition of the unselfish way he has repeatedly reached out to the industry and the people in it. Regardless of his schedule and the pressures of his job, he has always had time for people — at all levels. Regardless of the significance of their individual agendas, he’s never been too busy.

His ascension to the senior merchant and marketing level at Walgreens has been greeted with particular warmth and enthusiasm by the supplier community. That’s not because suppliers expect any kind of favorable treatment. It is only because at Duane Reade Ma­gnac­ca treated them with respect and intelligence. There is no reason to believe that things will be any different at Walgreens.

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