NCPA Digest: Business climate tougher for indies, but they still represent better bang for healthcare buck
SAN DIEGO — The number of independents still is down from 2000, and margins of 2.9% represent the lowest in five years. However community pharmacists have proven resilient and helped reduce healthcare costs by dispensing a record high number of lower-cost generic drugs in 2011 and reported more frequent interaction with physicians to promote the appropriate use of generics, according to the 2012 NCPA Digest, sponsored by Cardinal Health.
“The 2012 NCPA Digest, sponsored by Cardinal Health, provides fresh evidence of how trusted community pharmacists are working with patients and their physicians to improve health outcomes while reducing costs,” stated NCPA CEO Douglas Hoey. “Independent community pharmacists shattered their previous record in frequency of dispensing lower-cost generic drugs by raising the bar even higher in 2011. In addition, these small business healthcare providers are counseling patients face-to-face on the proper use of and adherence to their prescription drug regimen — making a dent in the estimated $290 billion in healthcare costs attributed to nonadherence," he said. “Community pharmacists are working more frequently with physicians and continue to play a vital role in improving health outcomes while reducing costs.”
The NCPA Digest findings included:
- The number of total independent community pharmacies increased slightly from 23,064 to 23,106 but have still not recovered to 2000 levels, when they totaled 24,861;
- The pretax net profit margin for the average independent community pharmacy fell to 2.9%, its lowest level in five years. Similarly, the number of independent pharmacies operating at a net financial loss increased slightly and continues to account for roughly 1-in-4 of these pharmacies;
- As the last Digest also found, 92% of revenue was derived from the sale of prescription drugs;
- Government-sponsored programs accounted for the largest share (49%) of their prescriptions;
- Independent community pharmacies set a new high in generic drug utilization, increasing their generic dispensing rate to 76% from 72%;
- Independent community pharmacists consulted with doctors about prescription drug therapy 7.9 times per day on average, marking a significant increase over prior years;
- Half of these pharmacies now have a formal program to increase medication adherence, such as refill synchronization programs like Simplify My Meds;
- To help remain competitive, independent community pharmacies found efficiencies to reduce their dispensing costs slightly, from $12.44 to $12.19 per prescription; and
- The most common niche services offered by independents include same-day home delivery (82% of pharmacies offer it, most free of charge), compounding (66%), durable medical equipment (65%) and immunizations (60%).
The Digest, a comprehensive survey of the current state of independent community pharmacies, was released Monday at NCPA’s 114th Annual Convention and Trade Exposition.
Pfizer honored with NCPA 2012 Corporate Recognition Award
SAN DIEGO — Pfizer on Monday was awarded the National Community Pharmacists Association 2012 Corporate Recognition Award at NCPA’s 114th Annual Convention and Trade Exposition, the association announced Monday.
“Pfizer is a longtime and steadfast supporter of independent community pharmacies and NCPA,” stated Lonny Wilson, NCPA president. “They often have been a quiet supporter, not seeking attention or headlines. However, I can proudly tell you that Pfizer has been a driving and indispensable force in NCPA’s adherence initiative PAMA, which stands for Pharmacists Advancing Medication Adherence. Pfizer wants to help reduce the billions of dollars a year that are wasted on the improper use of medications, by focusing on pharmacist-provided patient care services that improve patient outcomes. NCPA’s efforts are critical to that goal.”
NCPA has committed that by 2015, actions taken by independent community pharmacists will result in demonstrable improvement in patient medication adherence rates through the PAMA initiative. The core elements of this program will address behavioral changes in pharmacists’ actions and business enhancement opportunities. Pfizer supported the initiative since its inception.
University of Arkansas for Medical Sciences wins NCPA’s Pruitt-Schutte Student Business Plan Competition
SAN DIEGO — A team of pharmacy students from the University of Arkansas for Medical Sciences College of Pharmacy was named the winner of the 2012 Good Neighbor Pharmacy National Community Pharmacists Association Pruitt-Schutte Student Business Plan Competition, the National Community Pharmacists Association announced Monday. A team from the University of the Pacific Thomas J. Long School of Pharmacy & Health Sciences was runner-up, and a team representing the University of Kentucky College of Pharmacy finished as the second-runner up.
The three finalist teams and advisors made live presentations of their business plans before the competition judges and an audience during NCPA’s annual convention here. The 2012 competition drew a record number of entries from 40 schools and colleges of pharmacy, with four schools and colleges of pharmacy submitting a plan for the first time, NCPA reported.
"The NCPA Foundation is committed to connecting independent community pharmacy owners of the past, present and future to ensure millions of patients across America have access to these critical healthcare providers," stated Sharlea Leatherwood, NCPA Foundation president. “The Good Neighbor Pharmacy NCPA Pruitt-Schutte Student Business Plan Competition is our signature program because it provides the type of ‘dry run’ to developing a successful business plan that any prospective owner could benefit from. And if the past is prologue, then some of today’s participants will be owners in the future.”
The goal of the competition is to motivate pharmacy students to create a business model for buying an existing independent community pharmacy or developing a new pharmacy. Through this competition, NCPA is better able to prepare tomorrow’s pharmacy entrepreneurs for a successful future. The competition is supported by Good Neighbor Pharmacy, Pharmacists Mutual Companies and the NCPA Foundation.