A Trifecta of Threats (and Opportunities) Set to Become Mainstream in Pharmacy

Inevitability #1: Big-time Retailers Fill the Mail Order Gap

It was with great fanfare that Amazon announced early last month that it had made its first drone delivery from its Cambridge, England, facility.¹ I thought it interesting that the Wall Street Journal’s article about the launch of the service used medication delivery as an exemplar to highlight the advantages of drone delivery not once, but twice:

“Delivering tractor parts or medicine in rural or remote areas could work for drone delivery.” —Ivan Hoffman (former FedEx executive)

“United Parcel Service Inc (UPS), in September, kicked off a commercial drone delivery test for items like medicine.” —Wall Street Journal, December 14, 2016

Although commercial use of drones has seemingly been far off in the future, the ability to deliver items from central fill facilities via drones may be much closer to reality than previously thought, considering it was only last Christmas season that drones-as-toys became mainstream. Now, megasize companies are fighting a fierce battle to figure out alternative ways to get products from manufacturers to consumers. The traditional distribution-to-retail outlet model is under siege. Why else would Walmart buy Jet.com? Why else would UPS and FedEx be nervous about Amazon?

Because convenience is king and presale distribution of products to brick-and-mortar locations is waning, if not dying, the ability to sell a product before spending a dollar on distribution, storage, safe-keeping, and building maintenance—all while offering tens of millions of products—has gone from advantageous to essential. This inevitable and transformational shift will no doubt come to pharmacy and a doorstep near you. Heck, it’s already in the mail.

The time it takes for a package to arrive after a click on the computer can now be 24 hours or less. With drones, the time to delivery can be 30 minutes or less. This level of expediency, combined with advancing capabilities in telepharmacy, will no doubt fill the mail order gap, wherein medication list changes, acute medication needs, and impersonal care delivery (or lack of thereof) have prevented mail order businesses from taking over the industry entirely.

Inevitability #2: Tech-Check-Tech In Wisconsin Gets Significant Endorsement From NACDS

The Pharmacy Society of Wisconsin announced a partnership with the National Association of Chain Drug Stores (NACDS) to test a 3-year pilot program that “allows eligible, properly trained, and validated pharmacy technicians to complete the final check of a prescription filled by another technician.”² The advantage of such a workflow process and policy is self-evident:

“By reducing the time a pharmacist spends on completing final checks, pharmacists will be able to redeploy their time away from dispensing and toward direct patient care services, consequently yielding better patient outcomes.” —Pharmacy Society of Wisconsin website

This assumes, of course, that there is demand for direct patient care services from a pharmacist. Remember that, far and away, the largest human capital cost center in any pharmacy is the pharmacist(s).

Inevitability #3: The Glut of New Pharmacy Graduates Will Be Greeted With a Saturated Marketplace

A few years ago, the New Republic ran an article describing the inflection point of 2009, when the demand for pharmacist positions finally aligned with the supply after years of short supply.³ As is often the case with marketplace ebbs and flows, a natural tendency toward overcompensation seems to have resulted in an oversupply of pharmacists:

“My estimate [is] 20% unemployment of new grads by 2018,” Daniel Brown, a pharmacy professor at Palm Beach Atlantic University, told the Pittsburgh Post-Gazette in 2013.

“The job market is [stagnant], but we’re still pumping out graduates every year ... (and there is) little incentive for schools to slow down this expansion. PharmD students are cash cows, taking on hundreds of thousands of dollars in debt and often committing to a longer course of study.” —The New Republic, September 2014 If increasing supply is inevitable, the only acceptable response is an attempt to increase demand. Of course, Provider Status may fit the bill. Literally.

From Fulfillment To Care Delivery: An Imperative For Professional Sustainability

The trifecta of threats to full-time employment that I’ve just described is rooted in a common Achilles’ heel: the distribution of product as the core professional identity. Superior purchasing power, freight logistics, and automated filling have already won the battle of the fittest merchandiser. For pharmacy, mass production of pharmaceuticals led to mass distribution to retail pharmacy outlets, which, in turn, allowed for the provision of product-on-demand by pharmacies able to receive prescriptions for thousands of different products that could be filled in local neighborhoods in 15 minutes or less. However, that model will inevitably yield to mass distribution direct to the patient and on demand—that is, unless viable community-based care delivery services become a de facto requirement of fulfillment and distribution.

Not long from now, a singular business focus on the drug product will become unsustainable for community-based pharmacies that intend to employ a pharmacist. The product must now become the vehicle for delivering health care services—of the type that can only be delivered by community-based pharmacies—or there is no reason to use those pharmacies for distribution to the patient.

In an effort to leverage all of that education between the ears of the pharmacist, Tech-Check-Tech further removes pharmacists from distribution to free them up to establish relationships—interpersonal exchanges that are filled with durable, kind, and effective interactions that improve the health trajectory of the community’s residents. It’s a good thing that all of these schools (both old and new) have refocused training toward care delivery-oriented services. Now we all just need someone to demand those services.

Troy Trygstad, PharmD, PhD, MBA, is vice president of Pharmacy Programs for Community Care of North Carolina, which works collaboratively with more than 1800 medical practices to serve more than 1.6 million Medicaid, Medicare, commercially insured, and uninsured patients. He received his PharmD and MBA degrees from Drake University and a PhD in pharmaceutical outcomes and policy from the University of North Carolina. He also serves on the board of directors for the American Pharmacists Association Foundation.

References:

• Well G, Stevens L. Amazon conducts first commercial drone delivery. The Wall Street Journal website. wsj.com/articles/amazon-conducts-first-commercial-drone-delivery-1481725956. Updated December 14, 2016. Accessed December 20, 2016.
• Pharmacy Society of Wisconsin. Teck-Check-Tech Program. PSW website. pswi.org/Education/Tech-Check-Tech-Program. Accessed December 20, 2016.
• Zavadski K. The pharmacy school bubble is about to burst. New Republic website. newrepublic.com/article/119634/pharmacy-school-crisis-why-good-jobs-are-drying. Published September 29, 2014. Accessed December 20, 2016.
• Crighton M, Toscani M, Barone J, Colaizzi J. Are pharmacy schools growing too fast? Pharmacy Times^® website. pharmacytimes.com/publications/career/2016/pharmacycareers_february2016/are-pharmacy-schools-growing-too-fast. Published February 15, 2016. Accessed December 20, 2016.