Our friends at NCPA are making great progress in their never-ending efforts to advocate for the independent pharmacy industry. In this newsletter from NCPA’s CEO, Doug Hoey, they are highlighting some great work done with the Arkansas Pharmacists Association (APA) in the battle against Pharmacy Benefit Managers (PBMs). Great job, Arkansas!
Sometimes it’s hard to believe your own eyes.
That had to be the reaction from many in the room at a press conference held by the Arkansas Pharmacists Association this week when they heard of a $484 difference between what a Caremark-administered plan paid a community pharmacy for a 30-day supply of aripiprazole versus what it paid itself!
For years, community pharmacists have suspected that chains, especially CVS/Caremark (since it is a price giver and a price taker as a PBM and drugstore chain), are reimbursed more for prescriptions than community pharmacies are. The example shared with Arkansas legislators, patients, and pharmacies this week was eye-popping even as it verified our suspicions, and mind-boggling for the legislators and patients in the room who, directly or indirectly, are paying that whopping difference.
The aripiprazole example wasn’t an outlier, either. Scott Pace, the APA Executive Vice-President, and CEO held up a folder with 270 more examples of self-dealing. On average, he said, those examples showed a difference of over $60 more per prescription being paid to CVS than was being paid to community pharmacies!
So far, there is no word from Caremark on these payment discrepancies. And, no word from other mega-PBMs so far suggesting that they don’t follow the same practices.
Arkansas has an active state association, very active pharmacist members, and has historically been very politically active, making sure to sustain relationships with their local legislators. Couple those strengths with the extreme payment cuts to local pharmacies and this new information about inflated payments to out-of-state competitors, and you have a firestorm.
Local news stations covered the press conference, and the entire event was posted on Facebook. The governor has called a special session, and Arkansas Attorney General Leslie Rutledge is investigating the low reimbursement rates:
“The change in reimbursement rates by the Pharmacy Benefit Managers has hurt Arkansans in every community across the state,” said Attorney General Rutledge. “Local pharmacists are critical members of Arkansas’s communities. Due to these changes, pharmacists are facing tough decisions because the reimbursements do not cover the actual cost of the medications. When public health is threatened, all Arkansans suffer.”
Even before these latest examples, evidence has been piling up indicating that PBMs are contributing to the increasing costs of prescription drugs rather than saving their customers (employers and local, state, and federal governments) money. I’ve written here about this issue a couple of times already this year (Jan. 19, “A Coincidence That May Not Be a Coincidence,” and Feb. 9, “Let the Sun Shine In”). These revelations coming out of Arkansas show a proverbial henhouse that is being raided rather than guarded.
The payment discrepancy information revealed at this week’s press conference will reverberate through many state houses. It looks to any reasonable person that local pharmacies are being forced to subsidize higher payments to CVS pharmacies. Couple that with solicitations from CVS to buy the same pharmacies they are reimbursing below the cost of the drug, and it paints an ugly picture that should be of great interest to federal and state legislators and regulators.
Arkansas isn’t the only state where pharmacies—at least community pharmacies—are seeing extreme cuts in prescription reimbursements and are responding with legislative action. In fact, almost every state has introduced PBM legislation this year. The new, specific information about the yawning gaps between payments to community pharmacies and to CVS should make those statehouse debates even more compelling.
Pharmacists in Arkansas have joined hands and raised their voices. If you have been quietly rooting your own state on, now is the time to stand up, take part, and open the eyes of your state officials.
Pharmacy Owners: You can join the conversation and connect with like-minded independent pharmacy owners in our industry only message board. Click and be a part of the elite knowledge-sharing culture that has become synonymous with Pharmacy Development Services.
Millennials, defined as those born between the early 1980’s and 2000, are an extremely brand-loyal generation. Developing relationships with this demographic should be a major goal for your pharmacy. One of the best ways to gain the business of this 80-million member group is to gain their trust. You will be well on your way to securing millennial supporters if you adhere to these six easy tips:
Maintain an Authoritative Online Presence
Their ability to find information about you and your products is crucial. If you offer a service at your pharmacy, like a medication synchronization program, put it on your website and publicize it. Millennials did not learn computers and internet skills later in life like older generations – internet access is all they have ever known. They are the first generation to grow up in a digital world and simply will not trust a business without a quality website and reasonable social media engagement.
Engage with Them
It’s not enough to just have a website and social media accounts. They want to engage with brands on social networks. 62% of millennials say that if a brand interacts with them on social networks, they are more likely to become a loyal customer. This obviously requires more labor on your part, but will be well worth it when your business expands as a result.
Don’t Ignore Their Complaints
Some sociologists refer to the millennials as an entitled generation. What this means for your pharmacy is that ignoring their feelings is a sure way to lose their business. When problems develop, do not avoid them, make excuses or place blame. You should immediately fix the issue. In a millennial’s eyes, the customer is always right and keeping them happy is your responsibility.
Never Misrepresent a Product or Service
Remember, this is the group of people most likely to engage with their peer group over social media. Never misrepresent the features, advantages and benefits of a product or promise anything you can’t deliver. One millennial who feels they have been lied to can easily alert hundreds or even thousands of others within seconds, which will cause big problems for you. On the other hand, millennials can serve as irreplaceable ambassadors if they are happy with your business.
Let Them Help You Plan
Millennial customers are the future, so why not let them help plan that future? When determining upcoming services or goals, let a group of millennials help you decide on the next big steps. In a Forbes survey, 42% said they are interested in helping companies develop future products and services. Typically, companies create products and hope that their target market will consume them. Millennials don’t like this traditional mindset – they want to be involved with products from the beginning of development. If your pharmacy enables them to be part of your brainstorming, the whole process will be more successful.
Donate or Volunteer Locally
Millennials want to stay loyal to a brand that gives back to society. In the same Forbes survey, 75% said that it’s at least somewhat important that a company gives back instead of just making a profit. Millennials love brands that support their local communities and would rather purchase from them than corporate competitors. Your pharmacy can do this easily by rolling out a free children’s vitamin program or other services to benefit underprivileged youth.
If you want to build trust and credibility with your Millennial customers and hold on to them for life, you can easily get started today by watching our free webinar, 5 Ways to Attract, Engage, & Delight Millennials.
As social media becomes increasingly effective as a marketing tool, it is little wonder that small businesses as independent pharmacies are starting to take advantage of this convenient and cost-effective medium. Without a huge brand name or giant marketing budget, independent pharmacies need to get creative in engaging with customers and social media can be a great way to keep the relationship going beyond your store’s four walls.
However, many independent pharmacy owners and managers, find the thought of tackling social media confusing and overwhelming. Pharmaceutical marketing doesn’t have to be intimidating and in fact, here are a few easy ways to start using social media for business:
- Create a dedicated Facebook page for your pharmacy
By creating a simple Facebook page online, you will be able to post helpful information for your store, such as business hours, dates you will be closed, special events, disease-specific information, tips and more. Simply think of this as a modern day interactive phonebook, where people can look you up and stay in touch. You can post messages, answer questions and interact with customers and patients to help them find what they are looking for. Facebook provides easy instructions and best practices for getting started on their site.
- Consider setting up a Twitter account for your pharmacy
Pick an easy to identify Twitter handle (account username) for example @A1Pharmacy, which can be really effective for driving awareness to your store. Twitter is an easy and simple way to communicate with customers and prospects in real time. It can be a great tool to spread “short and sweet” messages about sales, vaccination clinics, CDC updates, awareness campaigns, educational seminars and so much more. Twitter can also be utilized for sharing information or suggestions either “live” or prescheduled at a later time that you designate. For example, you might tweet (a “Tweet” is a Twitter message in 140 characters or less) “Stop by our store today to get your flu shot before the season kicks into high gear.”
Regardless of what social channel you use, remember to create posts that lead to conversations rather than simply provide information. Negative comments should also be addressed on social media quickly and honestly. Complaints are a part of any business, but managing the issue and repairing your pharmacy’s brand with quick explanations or apologies will go a long way in increasing customer loyalty.
- Providing critical information to customers on your website
Although Facebook and Twitter can be easy ways to engage in online conversations, it is equally important to provide helpful information to customers via your website and follow-up with social media posts. This can include policy changes, medication recalls, emergency information after a natural disaster, job openings, disease education, government regulations, vaccine reminders and other important details about your pharmacy that customers should know and be able to learn about quickly. All information should be presented in a professional and knowledgeable manner, representing your pharmacy’s brand. Simply think of this method as another tool to engage and delight customers and reach those people who may not be responding to traditional direct mail or advertisements.
Both your website and social channels should be activated for promoting sales, seasonal events, invitations to customer appreciation days and other local community events.
Finding new methods to drive awareness to your store may seem challenging, but using a combination of traditional and new media marketing methods, will help your independent pharmacy thrive and grow.
If you have been paying any attention to the headlines, you know that Walmart recently announced the closing of 269 stores worldwide, including 154 stores in the United States. Stores began shutting down just two days after the announcement and have continued over the past few weeks. If one of the store closings is in your area, you have an opportunity to gain a huge amount of new business in your pharmacy, and acting quickly will be critical to your success in this area. Many PDS Members have reached out to ask for our recommendations and assistance in leveraging this opportunity.
1. Contact store management.
Pharmacy staff members at your local Walmart may be concerned about the well-being of their patients after the store closing. Take time to get in touch with them and offer your services to take care of their patients. Provide some flyers or business cards to be kept at the pharmacy counter.
A personal visit is worth 1,000 phone calls! As a pharmacy owner, you will be amazed at the results if you are able to build a strong relationship with big-box staff members before the store closes. You may gain insider information and they may be willing to distribute or display a letter on your behalf. Pharmacy staff will feel compelled to send dozens of patients to your store if they know you personally.
2. Recruit pharmacy talent.
Ask about top staff members that will soon be without a job. Excellent pharmacy staff can be difficult to find, so don’t miss the opportunity to recruit excellent talent with prior pharmacy experience in your local area.
3. Use traditional marketing techniques.
Radio, newspaper, TV and direct mail can all be great avenues to reach Walmart customers. Target your message to the Walmart audience and make them aware that their friendly local pharmacy is ready and willing to take over their healthcare needs.
4. Offer incentives.
Provide an in-store coupon for all former Walmart customers. You can make this coupon available on your website and in local newspapers. The Walmart coupon should be applicable to any customer transferring prescriptions. You may also choose to provide incentives or a contest for staff members who bring in the largest number of prescription transfers from family, friends and strangers alike.
5. Use social media marketing.
Create an advertisement for Facebook. You will have the ability to target cities where Walmarts are closing and select “liked Walmart” as a criteria for the audience who sees your ad. For only $5 or $10, your advertisement will be viewed by thousands of people on Facebook.
6. Implement a referral program.
Make a coupon for existing patients to share with family and friends. When they bring in a former Walmart patient, a discount is provided on any purchase for both the new and existing patient.
In any communication with Walmart patients, it may be productive to emphasize the importance of their health care and the fact that you have been and continue to, serve the community, offering pricing that is comparable and often times cheaper than local big-box stores. The message is that their neighborhood pharmacy is still eager to meet all of their health care needs. The local independent pharmacy is still their premier, reliable healthcare provider. Now is the time for independents to make it known that you can and will compete with out of pocket costs, and have been for many years or decades.
When an opportunity like this presents itself, time is of the essence. Independent pharmacy owners must be prepared to act quickly and effectively. That’s why it is so important to have a team of experts behind you. When news of Walmart closings became apparent a few weeks ago, PDS Members immediately worked with their Business Coaches and Performance Specialists to develop a plan of attack. Our members are already beginning to transition patients from local Walmarts into their pharmacies.
With PDS support, our members are able to move faster and more effectively than other independents. If you’re interested in learning more about how PDS can help you, like we help hundreds of other independents nationwide, sign up to speak with one of our Business Advisors. The conversation will be quick, easy and hassle-free.
The Pharmacist of the Year is selected annually based on their commitment to the well-being of their customers and local community and contributions to the independent pharmacy profession. Essentially, this is someone who is known for their committment to moving the profession forward in a positive way.
Jason Foil of Lumberton Drug Company in Lumberton, NC is a true innovator! He holds an Elite Level PDS Membership and has been part of our PDS Family since 2012. One of the reasons he is being recognized for this honor is his robust list of accomplishments and tremendous growth and profit for his three stores.
How did he achieve these phenomenal results? Here are a few highlights:
- His pharmacy offers a unique synchronization program called Home Rx that takes the enrollment process direct to patients’ homes or facilities. In 2015, he and his team expanded the Home RX program and doubled enrollments from 245 to 500 patients (a 1.8 x return on investment).
- He worked with his team to develop a Diabetes Care Club to monitor patients’ A1C numbers and to track and measure the impact of their program on their patients’ health. The Diabetes club has also attracted new patients to the pharmacy.
- He focused on building relationships with doctors in their community to look for opportunities to integrate the needs of the community with the pharmacy’s offerings.
- He focused on his own growth by participating in several PDS trainings including, the Advanced Leadership Program and Dare to be Free. He joined the PDS Board of Directors Group which he says provided him a network of contacts across the country and new opportunities, along with a peer group that held him accountable.
Congratulations to the PDS 2016 Pharmacist of the Year, Jason Foil of Lumberton Drug Company!
If you would like to reach this level of pharmacy achievement, it is never too early or too late to get started. Many of the most successful pharmacists we work with begin by focusing on one specific program like synchronization or compounding. Jump start your success by downloading your copy of our free ebook, Generating More Pharmacy Customers with Compounding, where you will learn how to launch your own compounding niche and get more customers in the door immediately.
Pharmacy Entrepreneur of the Year
At the annual PDS Super-Conference, we take time to recognize the exceptional achievements of industry leaders from the PDS community. This year, we presented awards for Pharmacist of the Year, Entrepreneur of the Year and Pharmacy Team of the Year.
The Entrepreneur of the Year is selected annually based on their dedication to the growth of their team, their business and the pharmacy industry as a whole. While we know that all PDS Members are dedicated to leading their pharmacy and the entire industry forward, this year’s winning pharmacy owner stood out from all the rest.
Amina Abubaker of RX Clinic Pharmacy has been part of the PDS family since 2012. She is a passionate and knowledgeable pharmacist who is very active, has received several accolades from pharmacy industry leadership organizations and is a true innovator, known for taking ideas and concepts and turning them into realities. She also does a great job of empowering her pharmacy team to help her achieve success.
Her list of accomplishments is very long, but here are a few highlights:
- Last year she focused on becoming a URAC accredited pharmacy
- Due to her ability to build relationships, the compounding business has grown enough to hire another pharmacist and technician
- Through her work with a primary care physician and an infectious disease PA, she helped create the first “one stop shop” for HIV care in North Carolina
- Her Clinical Pharmacist, alongside a physician and a PA, bill Medicare for annual wellness visits as a revenue stream for the pharmacy
- She launched a new PGx product called RxIGHT which is available to consumers, yet uses pharmacists as primary service providers for testing and counseling
- She enabled the pharmacy to be hand selected for a grant to provide specialized MTM services to help Medicare and Medicaid patients
- She added Rodan and Fields skincare lines as profitable revenue streams to the pharmacy
Amina’s achievements are extremely impressive, but it all started with just one step. One of our favorite quotes here at PDS is,
“A year from now, you will wish you had started today.”
In what area of your business can you initiate improvement right now?
Get started immediately by downloading your free copy of the ebook, Generating More Pharmacy Customers with Compounding, where we reveal important tips including:
- How pharmacy compounding drives business revenue
- How compounding ensures a steady flow of new customers
- What resources and trainings are available for compounding and much more
Learn more, launch your own compounding niche and get more customers in the door now! Before you know it, you could join the ranks with pharmacy industry leaders like Amina.
As we mentioned in our blog post Compounding: An Introduction and Getting Started, compounding used to be the primary function of pharmacists. They provided customized medication for patients, tailoring formulas to individual needs. With the advent of mass drug manufacturing, the role of compounding declined and pharmacists were seen more as drug dispensers than anything else.
However, recent technological advancements and increased innovation has again enabled modern pharmacists to revisit customized medications through compounding. This makes exploring the benefits of compounding as timely and a true differentiator in your local market that will help your pharmacy stand out.
For instance, when a patient is unable to take a commercially available drug or they require a medication that has been discontinued, a licensed pharmacist can recreate that medication via compounding. Other times, patients don’t respond to the traditional forms of treatment, or they simply need their medication in a different form. By offering compounding, you fill the need for a customized solution at your pharmacy.
Not convinced? We’ve detailed 5 key benefits of pharmacy compounding so you can learn how it can boost your business and help your patients live a healthier and happier life.
Providing Access to Discontinued Medications
At times, pharmaceutical manufacturers discontinue production of certain drugs due to low demand. In doing so, they make it difficult for the patients who still need these medications to fill their prescriptions.
Today, compounding pharmacies have access to the highest quality pharmaceutical ingredients and can fill the prescription, using the latest research, quality control process, and techniques.
Compounding pharmacists like you play a pivotal role in providing access to these medications by recreating pharmaceutical-based ingredients to get patients exactly what they need.
Making Medication Easier to Take
Let’s face it: Some medications have an unpleasant flavor, making it hard for the patients to take them as directed, which decreases the likelihood of compliance.
A compounding pharmacist can customize the prescription with the patient’s flavor of choice. This is especially handy when dealing with patients who may refuse medication, like young children, elderly patients, or even pets! Your patients will thank you once their medications become more tolerable. . Plus, they’ll tell their friends, family, and coworkers about you because you took away one of their “headaches” – administering medication to their child or elderly relative.
Offering Alternative Dosage Forms
For patients who have trouble swallowing pills, having the capability to provide an alternative form of the medication (such as a liquid, cream, or gel) is a convenient and appealing service.
Making Allergy-Sensitive Medication
Some patients cannot take mass-produced medication due to an allergy, a sensitivity, or intolerance of dyes, lactose, gluten, alcohol, fillers or preservatives contained in certain medications. A compounding pharmacist can make it possible for the patient to get the treatment they need by recreating the formula for that medication without the offensive ingredients.
Offering Unique Services that Set You Apart from Competition
Offering compounding at your pharmacy can set you apart from your competition. It allows the pharmacist to use their extensive drug knowledge to help the patient and prescriber create a truly unique treatment plan.
You are able to ask your customers about the side effects they’re experiencing and what questions they have about their medication. Then, you can start developing a new product catered to their individual needs – something chain pharmacies don’t do.
Compounding pharmacists are often able to offer treatments for unusual or resistant maladies that traditional allopathic medicine can’t help with or has failed.
Should You Offer Compounding at Your Pharmacy?
Consider this scenario: The average pharmacy with 100 patients per day can easily have 5 patients who will benefit from compounding products. With an average $50 spent per prescription, this would add $77,500.00 per year to your gross profit.
Compounding allows you to increase revenue while offering your patients and physicians alternative targeted solutions for their healthcare needs.
Still need more information? Download our free eBook! Generating More Pharmacy Customers Through Compounding and read more about how other independent pharmacy owners have succeeded by adding this profitable niche
Dan Benamoz, RPh, President and CEO of Pharmacy Development Services, discusses the technology trends that independent pharmacists should endeavor to familiarize themselves with.
This video was recorded at Pharmacy Development Services’ 2016 Super Conference in Orlando, Florida.
Independent Pharmacy’s Competitive Advantage Over Chains
Dan Benamoz, CEO and Founder of Pharmacy Development Services, always says that the main competitive advantage independent pharmacies have over retail chains is the ability to “turn on a dime.” While chain pharmacies are mass merchandisers, independents are not and should not try to be. Instead, independents should focus on innovation.
When an independent pharmacy owner identifies the innovative new program or technology they want to implement, they should focus on getting it done as quickly as possible. According to Dan, the public perception is that independent pharmacies are behind on technology, but that should not be the case. Independents have no bureaucracy, no attorneys, and no corporate red tape to get through when a new opportunity presents itself.
Here is what Dan Benamoz said on the subject in his February 2016 interview with Pharmacy Times:
Niche is a buzzword we love here at PDS. Of course, niche typically refers to specialty services, but at PDS we see niches as opportunities to stand out and dramatically improve your bottom line. The independent pharmacy landscape has shifted dramatically in the past few years and one of the biggest changes is in how pharmacists turn a profit. Now more than ever, independent pharmacies need to identify new programs and implement them quickly to stay ahead of competition.
How will you identify profitable new niche opportunities for your pharmacy?
1. Attend industry events with an open mind.
Industry events like the PDS Super-Conference are an incredible place to source new ideas for your business. In fact, we recently received this note from pharmacy owners who attended the 2016 event in Orlando:
“Dan, I would like to thank you for opening up our eyes to think out of the box and to learn how to work smarter, not harder. You have helped us to begin to change our thinking by not looking at the smaller picture but to look at the bigger picture. We were looking at the money we were losing on a product and not at what we could make in the long run. You gave us a starting point with ideas we will put in place. We want to be an elite pharmacy to help patients no matter what ailment they may have.” -Rudy and Dawn Letellier, Waveland Pharmacy
Although the note doesn’t make it clear which specific ideas, niches and programs were most impactful to them, we’re willing to bet that the ideas Rudy and Dawn picked up at the PDS Super-Conference have the ability to improve their company culture and increase cash flow.
2. Join a community of industry leaders.
We caught up with PDS Member, Angela Stokes, who raved about the benefits of PDS Membership and talked about the importance of identifying and implementing new programs.
“I could stand here and name programs probably for an hour, that we created and absorbed, and it revolutionized our pharmacy. I don’t even know if we would be in business today if it wasn’t for what PDS gifted us with.”
PDS Members form a unified community to share ideas and learn from each other’s successes and failures. They attend numerous pharmacy-specific trainings and work with best in class Subject Matter Experts, Business Coaches and Performance Specialists to identify and implement the best new programs faster than their competitors.
Watch the video to hear what Angela had to say:
3. Tap into online resources.
At the very least, digital resources like blogs, ebooks, webinars and message boards can help you stay informed. Enter your email address on this page to subscribe to the PDS blog and receive ideas, inspiration and updates tailored to the pharmacy industry. On the Industry Message Board (PDSAdvantage), you will have the ability to connect and converse with thousands of pharmacy professionals on a daily basis.
Time and again, we hear from pharmacy owners nationwide, who say that customized services like compounding, bedside delivery and SyncRx+ are the answer to obtaining new pharmacy customers and increasing profitability.
So what are you waiting for? Download your free copy of the ebook, Generating More Pharmacy Customers with Compounding, where we reveal important findings and tips including:
- How pharmacy compounding drives business revenue
- How compounding ensures a steady flow of new customers
- What resources and trainings are available for compounding and much more
Learn more, launch your own compounding niche and get more customers in the door now!