NCPA Executive Update

NCPA Executive Update delivers insights on legislative, regulatory, policy, and industry developments from NCPA CEO B. Douglas Hoey, Pharmacist, MBA, to NCPA members and pharmacy leaders every other Friday.

Will Community Pharmacy Be Uberized? | NCPA Executive Update | January 15, 2016

by NCPA | Jan 15, 2016

Dear Colleague,

Doug Hoey

Uber has turned transportation on its head. For years, taxis were the primary way for travelers to get around many towns and were regulated and controlled. In some big cities like New York, medallions which permitted the cab to operate in the city were sold or inherited like a precious heirloom. Finding a cab was not always convenient (try hailing one during a rain storm) nor were they always a great experience ("Are all those pine tree air fresheners dangling on the rear view mirror working?"). But then Uber comes into existence and disrupts decades of sometimes poor customer experience with its technology that enables anyone with a car to become an Uber driver.

Could independent pharmacy become "uberized"? Cabs have to have permits and licenses from the city and other oversight authorities. Uber seemed to blow by the rules and dare city regulators to come after them. Despite ongoing legal cases filed by taxis against Uber, over the last few years customers have voted with their feet and the court of public opinion, at least so far, has picked Uber.

Community pharmacies are highly regulated and also are required to carry permits and licenses in order to practice. Obviously, there are drastic differences between a taxi and community pharmacy, but could a disruptive technology like Uber turn pharmacy on its head?

I personally doubt it if for no other reason that the satisfaction with pharmacies is much higher than with taxis, but I can assure you from meetings I have with those in and outside of pharmacy, technology companies are desperately looking for ways in which they can mimic Uber's success in attracting new customers and tap into the $300 billion prescription drug marketplace.

Next month at NCPA's Multiple Locations Conference (MLC), Bill Roth, founding partner of Blue Fin Consulting Group, will give an overview of health care trends and their impact on the business of community pharmacy. Bill is well known in the industry and well respected for his use of data, industry experience, and instinct to form his crystal ball—perhaps one that could foresee the Uber impact. I've seen a preview of Bill's presentation, and those interested in staying one step ahead of the competition will find what he has to say illuminating.

Here are some of the topics Bill will cover during his program at MLC:

  • Product landscape: brands, generics, biosimilars, pricing pressure

  • Payer landscape: government reach and influence, Kaiserfication

  • Consolidation: power of big 3 anything, vertical consolidation, drivers and impacts

  • Societal trends: "uberization", decline of paternalism

  • Innovation:—robotics, e-health

Bill's program will help set the tone for the future, but the MLC will also have plenty of time for "here and now" topics like diversifying revenue through non-prescription sales and the popular "shoot the breeze" idea exchange. Join your colleagues at the Multiple Locations Conference Feb. 10-14 in Bonita Springs, Fla.


Doug Hoey

P.S. Speaking of the here and now, last week I talked about the start of the new year insurance problems, and the new MAC update requirements, and asked you to tell us what you are seeing. NCPA still wants to hear from you. Many of those comments talked about low MACs from Aetna. Aetna has responded to our outreach along with that of many PSAOs and individual pharmacies and says it has updated over 500 MACs. Let us know whether or not you are seeing the impact of those increases and if they reflect the marketplace reality on those products.

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