PHARMACY

Becoming a stronger pharmacy player

BY Michael Johnsen

A year ago, Fred’s Super Dollar was looking for buyers. Today, Fred’s Super Dollar has become the buyer having most recently acquired the specialty pharmacy business EntrustRx. While the southeast discounter generated moderate year-over-year sales growth of 1.6% for fiscal 2014, the company has its future square in its sites with an emphasis on pharmacy and specialty pharmacy. Fred’s has projected sales growth in the coming fiscal year to eclipse 10%.

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Pharmacy is integral to those growth projections and today accounts for 44% of Fred’s business. In 2015, Jerry Shore, Fred’s Super Dollar’s freshman CEO, expected Fred’s pharmacy business, both retail and specialty, to make up more than 50% of Fred’s revenues.

“Our pharmacy business, which continues to be our most profitable department of Fred’s, grew at an even faster pace in 2014,” Shore told analysts in March. “During the year, we improved our penetration of stores with pharmacies from 52% to 58% at year end,” he said. Ultimately, Fred’s wants a store base that consists between 65% and 70% retail pharmacies.

To that end, in the past six months Shore has amassed a team of proven retail executives, with experience spanning across the dollar channel, retail pharmacy and mass. Fred’s named Mike Bloom president and COO in January. Bloom comes to Fred’s from Family Dollar and CVS Health. In March, Shore and Bloom rounded out the senior executive management team with the addition of Walgreens veteran Bryan Pugh and the promotions of Craig Barnes, a one-time AutoZone executive, and Mike Holligan, who got his start with Walmart.

Fred’s isn’t forgetting its dollar channel heritage. “We perform a role in these rural markets that is very important for the consumer,” Bloom said. “I see us being a very strong [dollar store/ pharmacy] hybrid model, with a great pharmacy business [and] a strong health-and-beauty aid business. But it’s very important that we balance that with that general merchandise [selection].”

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PHARMACY

Health in a high-gloss setting

BY Jim Frederick

Building on its strong service reputation and a solid foundation of loyal shoppers in the Northeast and Mid-Atlantic region, Wegmans will continue its slow but steady expansion as it extends its menu of health-and-wellness offerings.

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Even though Wegmans reports that it opens “just two or three new stores each year,” at least another 10 new openings are planned, including stores in Alexandria, Va.; Concordville, Pa.; and Westwood, Mass. Longer term, another four new supermarkets with pharmacies are in the development pipeline for Virginia, along with two more in New Jersey and another new store in Maryland, according to the company.

Driving the company’s success: a solid reputation for delivering what it calls “a nearly telepathic level of customer service,” provided by motivated employees. Wegmans scored No. 7 on Fortune Magazine’s list of the 100 best companies to work for in 2015. In February, the company also scored No. 1 for corporate reputation among the 100 most visible companies in the 16th annual Harris Poll Reputation Quotient study.

Wegmans’ 85 in-store pharmacies extend its service reputation with a battery of new and ongoing preventive care programs, including adult immunizations; nearly 60 generic drugs offered at $4 for a 30-day supply; free home shipping of prescriptions; an auto-refill program; and a Wegmans Pharmacy Online service that gives customers “quick and easy access to prescription information,” according to the company.

Also available: a disease management program for Type 2 diabetics launched in 2014, and an individualized pharmacist consultation and screening program for patients with hypertension. Under its ongoing “Eat Well Live Well” program, Wegmans also offers healthy-eating store tours, special dietary advice and nutritional choices for customers dealing with diabetes, high blood pressure, food allergies, gluten intolerance and other conditions.

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Implementing MTM, med sync services

BY Richard Monks

Privately held since 2005, Shopko operates a wide range of store formats with healthcare offerings, ranging from full-service pharmacies to optical centers. Nearly 30% of Shopko’s sales come from these health-related services.

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Since its inception in 1962, the company has continued to grow and expand its reach, tailoring its various formats to meet the needs of different markets. The 133 stores it operates under the Shopko banner offer shoppers in small and mid-size cities and their suburbs a mixture of general merchandise and pharmacy and optical services across an 80,000-sq.-ft. footprint. Meanwhile, the company’s 178 Shopko Hometown stores average between 15,000 sq. ft. and 35,000 sq. ft., and operate in more rural locations. Most of these stores also offer pharmacy services.

Shopko fills more than 14 million pharmacy prescriptions and in excess of 525,000 optical prescriptions every year, spokeswoman Michelle Hansen said.

Founded by a pharmacist, Shopko has continued to evolve its pharmacy business over the past half century, most recently focusing on professional and personalized services, targeting both acute and chronic patients.

For example, Shopko is committed to medication therapy management at both state and national levels, and was the first chain pharmacy to join the Wisconsin Pharmacy Quality Collaborative, a group of pharmacists and healthcare plans working to create a reimbursement system based on pharmacists’ ability to drive outcomes.

In addition, Shopko’s pharmacies are moving to an appointment-based model by implementing a medication synchronization system.

In March, the company debuted 20 new Shopko Hometown outlets, converting outlets in nine states that it acquired from Alco Stores Inc.

That expansion is only the beginning. “We plan to accelerate new store growth in the second half of 2015 and 2016,” Hansen said.

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