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Voters next week to finally decide fate of unique 1963 North Dakota pharmacy ownership rule

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BISMARCK, North Dakota — On Election Day, North Dakota voters will have the chance to do what state lawmakers and the nation's highest court declined to do — reverse a half-century-old law requiring pharmacies to be majority-owned by pharmacists.

The pharmacy ownership restriction — the only one of its kind in the nation — has for decades put local druggists at odds with repeal advocates who want access to prescription drugs offered by large retailers. Opponents fear overturning the 1963 law will force locally-owned pharmacies out of business, especially in those in rural areas.

North Dakota's law survived a legal challenge that went to the U.S. Supreme Court, which upheld the law in 1973. The Legislature has rebuffed several attempts to repeal it, most recently in 2011 and despite an intense lobbying effort backed by Wal-Mart Stores Inc. and other large retailers.

Backers of the measure this year collected enough signatures to bypass the Legislature and for the first time put the issue directly to a statewide vote. And Wal-Mart has resurfaced, contributing more than $2 million to the repeal effort led by North Dakotans for Lower Pharmacy Prices, campaign filings show.

Foes and supporters both contend that they have the best path to cheaper prescription drugs in North Dakota. Both sides' political signs poked in lawns across the state make the case for less expensive drugs.

"The unique thing to Measure 7 is that both sides are arguing the same point," said Steve Boehning, president of the North Dakota Pharmacists Association, which opposes a change to state law. "But price is not the issue. Free market competition and rural access is the issue."

North Dakotans for Lower Pharmacy Prices, which is backing the measure, believes the market should be open to competition to keep up with prescription needs in the state, where the population has soared to record levels in the past few years due to an explosion of oil development.

"We feel the North Dakota law limits competition," spokeswoman Amanda Godfread said. The group that claims thousands of North Dakotans get their prescription drugs through the mail or travel to surrounding states and Canada.

"Let the options exist and let the customers decide," Godfread said. "It's good North Dakotans can finally say their piece on it."

Mark Hardy, executive director of the North Dakota Board of Pharmacy, said the state has 2,335 licensed pharmacists, a number that has remained stable over the past few years. But he said the state's sole pharmacy school at North Dakota State University in Fargo graduated 68 pharmacists this year, one of the biggest classes ever. The number of pharmacies in the state has increased from 225 in 2001 to 264 at present, he said.

Of North Dakota's 53 counties, only four — Slope, Billings, Burke and Steele — do not have a drug store located within their boundaries, he said.

Pharmacies that operated in North Dakota before the law was passed 51 years ago can operate without the restrictions, including many CVS Caremark Corp. pharmacies. Grocery stores and other businesses also are allowed to lease space to independent pharmacies, and own up to 49 percent of the pharmacy.

Shane Wendel, who owns pharmacies in Carrington and New Rockford, said he knows all of his customers by name. Wendel and other foes say prescription prices by independent pharmacies in the state are competitive with the major chains that they claim put profits ahead of patient care.

"The thing we have is the relationship with the patients," Wendel said. "Would people rather be dealing with individuals or dealing with corporations?"

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