Popping Pills Out of an ATM

By Julie Rawe; Sarah Sturmon Dale

There's a new vending machine making its way into doctors' offices across the country, but instead of dispensing soda or snacks, it spits out generic-drug samples--for free. Only physicians can access the machines, which are designed to counteract the armies of sales representatives who supply medical offices with samples of expensive brand-name drugs. The reps know that patients tend to stick with the familiar, even if doing so means paying more to get a prescription filled. Enter MedVantx of San Diego, whose ATM-like dispensers enable doctors for the first time to give away samples of less costly generics. Says CEO Robert Feeney: "We're attempting to create a more level playing field."

Managed-care companies in several states, eager to rein in prescription-drug costs, foot the entire MedVantx bill, which includes keeping track of which patients receive a 30-day supply of one of 21 generic drugs. Among the latest to sign on is Medica, Minnesota's largest HMO, which installed MedVantx machines in 10 clinics this month. According to Medica's medical director, Dr. Ted Loftness, a mere 1% increase in generic prescriptions could save the company more than $6 million a year. --By Julie Rawe and Sarah Sturmon Dale