Selling pharmaceuticals is a big business that's in serious flux. Health-care costs are spiraling skyward, and prescription drugs have led the charge: In the 1970s and '80s, drugs accounted for just a single-digit fraction of health-care costs; now the percentage is solidly in the double digits. The impact of the 2004 Medicare Modernization Act and the legality of drug re-importation are prime industry issues, and both are inherently tied to rising costs.
On the retail front, the Big Box is in; the neighborhood druggist is out.
National chain drugstores have ravaged independent pharmacies in the last decade. And many consumers have taken to alternative remedies beyond the realm of your old-fashioned drugstore--think Echinacea and acupuncture.
As retail pharmacies have changed, however, the back end of the industry has pretty much stayed the same. Pharmacy-benefit administrators--companies that manage pharmacy claims for employers and health plans--by and large won't disclose information regarding their revenue streams. This doesn't sit too well with employers and insurers, who'd like to rein in the never-ending escalation of costs.
A pair of Colorado-based businesses--Boulder's Pharmaca Integrative Pharmacy Inc. and HealthTrans LLC, in Greenwood Village--are industry innovators.
Pharmaca is bringing alternative medicine to the neighborhood drugstore; HealthTrans is lifting the veil of secrecy from pharmacy benefits administration. The common thread? Both companies are enjoying a great deal of success in ignoring the status quo. Here are their stories:
HEALTHTRANS: DISCLOSURE BUCKS OLD INDUSTRY MODEL
Sometimes innovation is more ethical than technological.
HealthTrans, a pharmacy-benefits manager born from a 2000 joint venture by Atlanta-based NDCHealth and the local HealthTrans Data Services, is blazing a new trail simply by being straightforward with employers and health plans, who are customers.
After a pharmacist submits an electronic claim to a health plan, HealthTrans' software system checks the patient's eligibility and the intricacies of the plan with such customers as Rocky Mountain Health Plans and Kaiser Permanente, double-checks the clinical information, and prices the drug. "We respond back to the pharmacy with all of that information in about a second," said HealthTrans COO Lou Hutchison.
While HealthTrans' response time is fast for the industry, its cutting-edge software is not its prime distinction. The...