Q&A: David Neu on navigating the future of pharmacy

LAS VEGAS — AmerisourceBergen and Good Neighbor Pharmacy introduced a slew of new programs at ThoughtSpot 2015 this year. Drug Store News caught up with David Neu, EVP AmerisourceBergen and president Good Neighbor Pharmacy, at the show to discuss how those new programs will help Good Neighbor Pharmacy pharmacists better navigate the future.



Drug Store News: At the General Session, you mentioned that it’s probably the most complicated time in pharmacy that you’ve ever seen. What did you mean by that?



David Neu: For the independent community pharmacy, it’s probably two or three things. One is that they’re in a bit of this contradiction. They really need, for many good reasons, to have their independent pride. They are a commercial business, they are a small business owner, so that identity is very important to them. The other piece is they need the leverage and the scale of the things that their competitors, the chains for example, bring —  backroom functions, support on advertising and promotion that the chains work very hard at with the manufacturing community. The complexity is that they’re fighting the good fight every day. They’ve got tough reimbursement; they’ve got access issues; they’ve got a lot of focus on Star ratings for patients, and it’s tough for them to get at some of the infrastructure. That’s why we talked about complexity today [at ThoughtSpot 2015] — what’s the best way to take some of that burden off?



DSN: From your vantage point, what do you think are the biggest challenges facing the independent today, and how is Good Neighbor Pharmacy helping them overcome some of those challenges?



Neu: There are a couple that are kind of a constant in the industry, and you probably hear them from most people that you would ask that question. Reimbursement of course is at the top of the list. And no question that is one that is pressing them, and at times feels a bit out of their control. There are a couple that are right there with it when it comes to profitability and effectiveness. If you think about independents as a merchant and what makes up their P&L and profit margin, the pharmacy prescription piece is just one component. The way they connect that back to companion sales on the front end, making sure they connect dots for a total experience for the patient, the way that they set that out — they integrate their techs in that process and bring it together as a destination — is essential if they’re going to be competitive operating at a level that their peers do or above.  No question then on the reimbursement side that they’re getting squeezed. We talked about ... ways we can help them with that, but they have to bring that consumer piece and that back-end third-party orientation managed care. They have to bring the two together.



DSN: This morning at the General Session, you talked about the broadening of your relationship between AmerisourceBergen, Good Neighbor Pharmacy and independents. You referred to it as an inflection point in that relationship. Can you talk to us a little bit more about what you mean by that?



Neu: What I meant by that is we have tried to bring a set of disparate solutions over the years to the independent to try to solve certain problems. There are many technology partners that are vital to their success. … So instead of going out and trying to fix a problem, we brought in who we believed to be the industry leaders in data — Emdeon in post-editing. [We brought in] industry leaders in reconciliation, FDS was the partner we selected. We brought in some new technology through PrescribeWellness on patient care.



And we didn’t just bring them in as a way to fix the problem of the day, we brought them in as a collective. And that process was to [combine] them in this comprehensive set of solutions [and] under one package so that it would be connected together. I think the reason that’s important is outside of that solution set, we have over 35 different pharmacy systems that we deal with. The payers and the PBMs want continuity and consistency of that connection. One of those places is us, through our third-party network, which was just announced today as Elevate Provider Network. But the other piece is how they interact with them systemically. What this does now is provide a pathway, and it becomes much easier now to deal with us like a chain.



DSN: The industry is in the process of transitioning to a pay-for-performance business model, but the reality is it is still a pay-for-service reimbursement model today. How does Good Neighbor Pharmacy help bridge that transition?



Neu: That question is one of the most complicated ones that the industry’s been wrestling with for years. It’s interesting, before medication therapy management, we had reimbursement for cognitive services. We had in there a bit of clinical consulting, and it has always been about who’s going to pay for it? And the other piece is without a centralized patient record, what value is there? [What] if there was a consult for an asthmatic, but we didn’t know that they went to the ER fewer times because there was no connection?



That’s starting to change now. It doesn’t change overnight, but one of the things that’s happened recently with the change in health care and the Star measures, is that there is now a [mechanism] to capture this information. It’s not perfect, but the payers and PBMs have gotten smart. They have put incentives and disincentives in place that if you don’t show specific change, outcomes … if [the needle] is not moved, people either have reimbursement reduced or they could even in a worse case get cut out. There is both a carrot and a stick here. So I think with the pharmacist realizing as well that they have to get to the table and they need some partners and technology, that’s a big catalyst as to why Elevate Provider Network has become so important. I believe that there’s going to be a balance, a payment for services and outcomes management, it’s going to morph over time. But we’ve got the accelerator on now in a way that’s much different than all the pontificating that we did about it for 10, 15 years, and there really wasn’t a financial incentive or disincentive there. That’s really started to change.