How Will Pharmacy Chains Respond to PillPack?

Health care is a sector ripe for opportunities for disruption, and PillPack has demonstrated how 1 untapped pharmacy service can be brought to the masses.

Multidose drug dispensing (MDD) or multidose medication management (MMM) systems like PillPak clash against the traditional single-dose vials (SDV) most patients are familiar with. Medications packaged outside of a clear amber vial are novelties for most Americans.

The idea of packaging medications in plastic blister strips for dispensing is not new, however, as the process has traditionally been used in the inpatient setting and long-term care or nursing/assisted-living homes. PillPack CEO TJ Parker even came up with the idea from his father’s pharmacy, which provided such services to the neighboring community.

The American Society of Health-System Pharmacists sponsored several research grants for MDD systems in the past, more often geared at using the services for patients at hospital discharge. But the use of MDD systems is not confined to the United States.

Take, for example, a Singapore company that rolled out an MMM system to supply medications to nursing homes and mental health patients in conjunction with the nation's government. Several countries in Europe also use MDD Systems to supply medications to patients in the home and at nursing centers.

Multiple companies sell devices and services for pharmacies to start their own MDD systems. For instance, Parata has its own Parata PASS (Patient Adherence Strip System) line that includes machines to package the drugs, and the associated hardware and software to run such a service.

But most of these services and companies are exclusively geared towards nursing and assisted-living homes, not the nominally functional patient in the ambulatory care environment who PillPack is targeting.

Why now? First, the technology is finally there. The production side of things has been around for years, but what's new is the mentality and mechanisms of ordering anything online and having it home-delivered in days. This is coupled with mobile apps for patients to use and engage with services provided by companies like PillPack.

Second, the nature of mail-order pharmacy has become a mindset among patients, and the services provided by PillPack are very analogous.

Third, the novelty and simplicity behind what PillPack is selling hits home for most patients, which helps build customer loyalty and desire to use such a service. Patients are using an increasing number of medications, and they are living longer with chronic diseases. As a result, they are encumbered by a number of SDVs, so preparing and using a pill box seems nonsensical when a service like PillPack is readily available.

Lastly, it seems the people behind PillPack saw a good business opportunity in taking MDD systems nationally, rather than just locally, as smaller independent pharmacies have done.

Based on the success PillPack has had thus far, how will other pharmacy companies compete? CVS has launched its own mail-order MDD service, which is currently taking customers. I feel this was inevitable, and other companies will quickly join in.

Other large pharmacy chains may begin looking at smaller companies or independent pharmacies to acquire in order to roll out similar services. It just makes sense for them to offer something similar to PillPack, especially since the manufacturing capacity is there and the technology is now available widely. Plus, patients want it.

Which company will stand out in the impending battle of drug delivery services?