RxOwnership luncheon emphasizes efforts to ‘keep independents independent’

Since it began in 2008, McKesson’s RxOwnership has helped more than 3,500 pharmacy owners buy, sell or start their own pharmacy business in an attempt to, as RxOwnership national VP Chris Cella told Drug Store News, “keep independents independent.” Cella participated in an “Ask the Experts” panel with three longtime RxOwnership collaborators at McKesson ideaShare 2016 to help potential pharmacy owners and sellers understand RxOwnership’s services and the work required to break into being a small business owner.



The panel, moderated by RxOwnership northeast region ownership adviser Tammy McDonald, saw Cella discuss the finer points of buying, selling and starting pharmacies with Waypoint Strategic Advisors founder Rick Coakley, Live Oak Bank pharmacy division general manager Jimmy Neil and former RxOwnership national VP and current managing director of First Financial Bank’s professional services division Bob Graul.



The panelists discussed the resources that RxOwnership provides for no fee to would-be owners, including tools for helping customers figure out the basics of their pharmacy, from a demographic breakdown of their local market to the number of prescriptions being written in the area, and tools to help them project when they might begin to see ROI on a new store, in addition to financial advising and other resources.



But the process begins, at least for start-up pharmacies, with what they’re hoping to contribute to the independent pharmacy space that can differentiate them from competitors.



“You've got to be able to tell me why patients want to come to your store from where they're currently going,” Cella told Drug Store News. “It's extremely important with a start-up that the business plan is done, that it's done right and that you understand it's a living document that needs to be reviewed constantly. It's not something you just submit to the bank to get your loan and then tuck away for the rest of your career.”



One of the major themes that emerged from the panel was the need for potential owners to become informed about the industry, where it is headed and the work that comes with getting a pharmacy off the ground — especially when it can take several months for a pharmacy to break even.



Coakley told luncheon attendees, “There is some personal sacrifice in starting up your own business or buying your own business, and it's important to think about that and take care of that personal side.”



Owners looking to sell their pharmacy face their own set of challenges, Cella explained, that RxOwnership can help them overcome. Cella emphasized the need to have at least a five-year plan to exit the business, rather than what he calls the “fire sale” approach of deciding to sell and trying to do so the next day.



For new owners looking to purchase a pharmacy, perhaps even more important than actually being a pharmacist is the desire to be involved in every area to help grow the business. That starts with knowing what sort of pharmacy you want to run; RxOwnership can help narrow down the search among its database of pharmacies to match the buyer.



“As a lender, what I’ve seen in the last 20 plus years is: Are you an active investor and participant in the business?” Live Oak’s Neil asked attendees. “Are you there working it all day long solving problems, motivating and leading people, innovating, inventing, doing the things you need to do to differentiate? To me that's more important than whether you’re a pharmacist or not.”



The end goal of assisting three different types of clients to open, buy and sell a pharmacy, as well as the outreach efforts RxOwnership makes to entrepreneurial pharmacy students, is to provide better health care to communities. And ultimately that often means helping independent pharmacies remain independent — even after an owner decides it’s time to move on.



“We’re finding that independents are more prepared for the changes in health care,” Cella said. “The switch from fee-for-service to pay-for-performance is more geared toward an independent. There are numerous studies done by the National Community Pharmacists Association and the American Pharmacists Association showing that the independent pharmacy owner and the independent pharmacist are better healthcare providers.”