After 103 years, Novi, Mich.-based Frank W. Kerr Co., once one of the country's largest independent pharmaceutical wholesalers, is calling it quits.
According to a recent letter to the Michigan Workforce Development Agency, the company will close by Tuesday. Layoffs of the 60 company employees began June 14 and will end Tuesday.
"The retail pharmacy sector has consolidated significantly over the last decade due to changing market conditions, pressure on profit margins and the rapid expansion of publicly traded pharmacy operations with national reach," Michael Layne, spokesman for Frank W. Kerr, said in an emailed statement Wednesday. "Kerr was a critic of mandatory mail order programs promoted by the pharmacy benefits managers that own them."
The statement said Kerr advocated for the repeal of a Michigan law prohibiting mail order and proceeded to start Michigan's first mail-order pharmacy company, NoviXus Pharmacy Services. NoviXus is housed in the Frank W. Kerr building at 43155 W. Nine Mile Road.
NoviXus CEO Rich Grossman said in an email to Crain's that the company will continue to operate in the building. It has 75 employees.
Layne said NoviXus will remain in business independent of its former owner, Frank W. Kerr.
According to the Frank W. Kerr Co. website, Kerr's customer list through the years included many local and national chains, such as Revco, Cunningham Drug, Apex, Kmart, Arbor, Meijer Inc. and Sav-Mor Drugs. It provided retail customers with brand and generic pharmaceuticals, over-the-counter drugs, private label goods, sundries and promotional programs. Kerr, which was founded in 1913, was involved in the opening of the first Meijer pharmacy in 1962 and the first Kmart pharmacy in 1969.
Recently, Kerr's largest customer with locations nationwide and "responsible for much of Kerr's operational profitability, reached an agreement with a large national pharmacy wholesaler," the statement explained.
"After working with both financial institutions and professional advisers, it became clear that ceasing operations was the only option and Kerr could not survive the loss of its largest customer," Layne said in the statement.
The company was purchased out of bankruptcy by former Detroit Pistons owner and billionaire William Davidson in 1951. He helped return the company to profitability and capture the business of Kmart and Meijer.
Frank W. Kerr President Ann Newman started with the company as a janitor in 1952. The Polish immigrant rose through the ranks from the warehouse to purchasing, eventually becoming a partner and a controlling stockholder, Layne said.
"Novi-based drug wholesaler Frank W. Kerr Co. to close after 103 years" originally appeared in Crain's Detroit Business.
