FRANCHISER TO HELP RUN PHARMACIES AKASH N' KARRY

CHAPIN CLARK

TAMPA, Fla. -- Kash n' Karry Food Stores here has tapped pharmacy franchiser Medicine Shoppe International, St. Louis, to help run its pharmacy operation.

Medicine Shoppe, with more than 1,000 locations in the United States, is the country's largest pharmacy franchiser and is expected to give Kash n' Karry added buying power and a wider range of customer services. Medicine Shoppe, a division of drug distributor Cardinal Health, Dublin, Ohio, had more than $1.2 billion in retail sales last year.

Both Chris Ahearn, a spokeswoman for Kash n' Karry parent Food Lion, Salisbury, N.C., and Nancy Schwartz, a Medicine Shoppe spokeswoman, declined to discuss financial terms, but Medicine Shoppe typically receives a share of the profits generated by its franchisees.

Under the agreement, announced Feb. 17, 91-store Kash n' Karry will continue to own its 50 in-store pharmacies, and pharmacy staffers will remain Kash n' Karry employees. But over the next several months the pharmacies will adopt the Medicine Shoppe name and operating systems and will participate in all prescription-insurance plans accepted by Medicine Shoppe.

Schwartz would not say how many plans the company accepts, but she said the total number affects an estimated 160 million lives.

Kash n' Karry also will install Medicine Shoppe pharmacies in the seven new stores it is building in 1999, as well as in selected existing stores that have space to accommodate the departments, Ahearn said.

"Medicine Shoppe is widely renowned as an outstanding operator, and we felt there were some efficiencies they could bring to the table."

Medicine Shoppe negotiates managed-care contracts on behalf of its franchisees through Medicine Shoppe Internet, a wholly owned subsidiary.

Food Lion, which operates only one pharmacy, a Winchester, Va., test unit installed in October 1998, will also bring Medicine Shoppe pharmacies to new and existing stores. Food Lion, though, has yet to decide on the scope and timing of the rollout, Ahearn said.

"Our first area of concentration is Kash n' Karry."