The Future of Compounding Pharmacies | Brett Pine Revelation Pharma, CBDO

This transcript was generated automatically. Its accuracy may vary.

Mike:  Brett, Introduce yourself to our listeners.

Brett Pine: My name is Brett Pine. I'm up in Chicago, Illinois. I'm the Chief Business Development Officer at Revelation Pharma. We're a buy and build compounding pharmacy group.

So we have a network of 503A, 503B pharmacies. The other side of our house is really from an acquisition standpoint.

We get very excited about working with sellers of compounding pharmacies that want to come along for a journey, are ready to exit their space, us come in and acquire, we just want to add to what's already great and see if there's some sellers that want to go along for a great ride and get a second bite of the apple. I'm very fortunate that I get to lead our sales and marketing sleeves and we're very fortunate that we get to work with patients and physicians and referral bases in all 50 states and get to continue to extend our outreach on a national level.

Mike: So have some Pharmacies that the person may say, I want to join in with revelation. I want to be basically one of their pharmacies. You also have another side where you buy just their records.

Is that kind of the two different sides of the company? 

Brett Pine: We do buy brick and mortar where we buy a pharmacy, we keep It intact. It stays operational. During that time, the seller can choose to stay on. The seller can choose to retire because maybe they don't have one. Anyone behind that wants to come in and continue the business, but then we also book a business we call Bob's, but book a business is basically a site that is preparing to close, we will acquire their records and essentially copies of the prescriptions where we will then. take over taking care of their patients and continuing service and medication provided through the referral basis. Their site closes and we maintain their records and go ahead and keep servicing those patients. And again, it all is compounding based. That would be two sides of our acquisition house.

Mike: That's the merger and acquisition side of revelation. And then the other side is you forget about the mergers and so on. Then it's the actual business, the actual running that company. What is that side of it?

Brett Pine: It is a network of independent pharmacies that we put together. We're not a chain that's not our aspiration or goal. Pharmacies come into our network. We then operationally maintain them. SOP standing operating procedures.

We put a lot of compliance around it to make sure we're at the highest regulatory capability from a quality control, quality assurance aspect. Then people like myself on the sales side, they either will have a salesperson or sales team there, or they won't. And what we do is we add our sales. Our field sales people there to help surround them with someone who is going to be contacting the referral basis, show them what our capabilities are, sure we retain and hold down and take care of the patients we have, but also grow the patient population in certain therapeutic areas.

Mike: So Brett, out of the MNA what is the worst? of each of those people. So someone's going to sell you just the book of business. Someone's going to actually become part of the network. What is the worst emotion? 

Brett Pine: Business, the negative comes into play when they hit an instant time crunch, they have decided they're going to close their door. They need someone to figure out how to. Get them to where they need to be in a short period of time. And they're just not happy about the timeline. We need a certain amount of time to do something successfully. We're very in tune with doing things the right way. And part of the right way is making sure you take care of the patient. I would say the negative comes in when they're in a high time crunch and they don't want to wait any longer now that they've made their decision and they get unhappy about it, but at the same time, we want them to. We want to have their patients succeed and continue positive outcomes. If you rush it, patients are the one that are going to take the brunt of it.

And at that point in time, they've kind of, they've already washed their hands. They wish the best for their patients, but they're done. And they get very frustrated at the speed. We do it pretty quickly, but , quick will never be enough. A brick and mortar, I would say this, the people that want to remain, they have to also understand that we have a very certain way about going about doing everything.

And we have a great track record or how we do it. I used to own my pharmacy, a pharmacy before I sold to a different group years ago. So I can, I can relate to this, but when you're an owner, you know how to do things a certain way that has worked for you. And when someone comes in and is playing with your baby, Which is your pharmacy. And it really doesn't matter what you own, what you own is what you've created and put your blood, sweat, and tears into. You think you still know what's best for them. And even though

a company like us has the best intentions, if it's different, different and. And change creates fear and ambiguity. Ambiguity creates uncomfortableness. So I think there's a, there's a, a fear of losing control. And then the control that gets put in place might be different than what they're accustomed to. And I think it's scary. I think the world changes. is pretty, pretty fearful.

And 

instance come into play

and

Mike: I imagine that some people maybe start one or the other, they might say that they want to do the acquisition and then whatever time wise or things we mentioned, maybe they change their mind at that point and say, yeah, Let's just get the hell out of here.

Brett Pine: I don't think it's an easy decision to decide to sell their pharmacy. Most people have spent a good amount of time and hours and years there, and it's hard to let go of that. there's. There's circumstances that come up with that, or whether you have a lease 

expiring that you can't get through with your landlord, just need to stop the bleed and let someone else come in and try to fix it, which we've 

it really comes down to time.

And although pretty swift in our MNA actions, people always want to go faster. But again, 

if you go too fast, you create an opportunity for failure 

Mike: About five years ago when DIRs were at their worst, I was bleeding through probably, I don't know, a thousand bucks a day, something like that , a quarter million dollars a year. I had this house next to our pharmacy that I had bought, 10 years before that. And it's like the value of that house was eaten up like in.

Two months have gone by. And so at that time I was looking for a buyer for the pharmacy and you're right. I mean, I wanted this thing to be done like on the weekend. And of course that's not going to happen after that point. We finally got rid of the brand name, stopped that bleeding and that kind of stuff.

But I imagine some people when they want to go, they want to go, I mean, they want it done like tomorrow. 

Brett Pine: when you, when someone gets to that point, no matter how well you do a kid gloves, white glove service, talk them off the ledge. I think it takes a long time to make the decision. And then you don't want to take any time for that decision to complete. 

, it takes a

lot to get And once you've made that go, let's go. And they know that a lot of things are out of Out of people's control, whether it's, , legal boards of pharmacy, licensure, vendor agreements, this, that, and the other. And you're like, I'm moving as fast as possible. But, yeah, I think I think once people make that decision, whether it's hard or easy, more more often, it's hard. But then once that decision has been made, you flip a switch and it's like. I already flipped the switch. So what are we waiting for?

Mike: Yeah, I know how that goes. I mean, like in our living room, I've had this TV there for, like a 38 incher and I don't have too much room for it, but I'm going to go up to a whopping 43 incher. And , I've had this TV in our house for 20 years like this, but yesterday at 6 PM, when I made that decision that I was going to make this.

Whether my wife liked it or not, I was going to make this decision and I wanted it to happen in an hour. I was going to run out of Walmart stuff. But I think decisions are tough and they gnaw at you. And once you make it, you just want to go for it.

Brett Pine: I think when the decisions are a little bit easier is when it's financially driven, especially if it's a negative situation, you kind of have your hands tied. So when you're like, I'm making this decision because I feel the need to do it. The decision is for a specific large reason, not equally important, but hourglass has already run out on you.

And every day that you wait longer is costing you a lot more. So waiting is not necessarily, Hey, I don't want to, it's. I can't, I can't wait any longer. It's just draining bank accounts that I don't have money to, to push out further and I've done the best I can. So there's definitely sometimes where emotion is involved , sometimes where life is involved and it has, , once that freight train is heading downhill, it takes a lot to slow it down if you even can. So I 

get it. I am nice with people when they're in those,

And we want the best opportunity to get out the other side of it,get some cash in the short term. And potentially a second bite of the apple on a longer term, whether that's in an earn out or equity or something of that nature, but we don't want to take their, take, , a company off their hands, make it great, and then not have them have anything to show for it.

We, we do want 

win win situations. 

It's like the angst of the decision lessons when it's financial.

had this employee years ago and we butted heads a little bit. 

Mike: , I didn't want it to go on any longer.

a year came by where I didn't hit a certain number I wanted to hit, I basically used that as my own, it wasn't an excuse. It was true, but it was easy to bring that person in and say, Hey, look, I'm sorry, but we're not cutting it here. And, I wish you well, but it just can't work out financially here.

That was a hell of a lot easier than saying, , you and I don't get along and you think, I'm full of nepotism and it's just an easier conversation when the money has a lot to do with it, it's easier for everybody. This is black and white.

This is what we have to do.

Brett Pine: There's a lot of great things that come with ownership, but some of the things that come with it that are difficult is, you know, stress, and risk is real. And it's also real to bring it home. And, at some point if it gets real hard, hard to have that distinguishing line. And, , I live in a family first belief and, , the last thing I wanted to do is bring it home. And I, I knew I, I knew when it was getting close to time that we were going to sell our pharmacy. We actually were at our peak and we hadn't even contemplated, but a good opportunity arose.

And once that seed get planted in my head, it didn't take long for it to get watered and start to grow. And then once it grow and it takes roots in your brain, you're like, I'm going to do this. And, I will say, , once it's done this is something very interesting that I'd be curious if other sellers have actually felt to, as I kept thinking, oh, this would be so amazing.

You get this payday and this, that, and the other, I felt relief. I wasn't I wasn't like, Oh, my God, look at my bank account with this. I was relieved. I felt like a weight came off my chest, because it actually takes on a second job when you're trying to sell your pharmacy, you don't want to upset the people that work with you.

Cause they're the ones that helped get you there. So you're doing this other thing on the side and you're doing all this due diligence with them and you're answering all these questions and you're looking at your business in a way you've never thought of it before. And then someone's analyzing your baby in the form of your business.

And I will say that, , after all the dust settled I wish, I wish revelation was around when I sold my pharmacy. It was a couple of years before its inception. I'd be even better placed than I fortunately am today.  

Mike: So Brett, when I was thinking compounding, , I'm thinking a certain like a hundred percent compounding, but these are going to be a lot of just family pharmacies that do a certain percentage of compounding, I imagine.

Brett Pine: We stratify our pharmacies in the way we view them in three ways, in three forms, Tier 1, 2, 3. Tier 1 is a large pharmacy doing at least multiple million dollars in revenue and license in almost every state, if not every state. They need to do sterile and non sterile, tier 2s are a medium sized pharmacy. They'll have 20 odd licenses and a couple million dollars in revenue. They'll be able to do sterile and non sterile compounding as well. And Tier 3 is really your local mom and pop shop, sort of what you were alluding to. Very neighborhood driven, locally driven. If anything, license in their home state, maybe one or two others at best. They only do non sterile and it's either yes, we do some compounding, but we also could sell your Lipitor and we'll work with your insurance plan and this, that, and the other, know, in a perfect world, first of all, we of those, but in a perfect world and where we are today, we look for a larger pharmacy doing. All compounds are close to it. Where it is truly their focus, their passion, their compliance is high. They're driven to grow that segment. And then we don't work with insurance. Typically it's nothing against insurance, but it's a self pay medium on the compounding side. We dictate our pricing. We could get as competitive as we can, but also maintain our margins and you get paid up front and you don't know, no audits and whatnot. So what I'd say to this is there are pharmacies that we engage with that do. 60 to 75 percent compounding, which means they have a retail component or they will do long term care and hospice meds or whatever it is. We normally will either help them sell that part off or we will acquire the whole thing and sell that segment off.

So we stick with our thesis of just compounds. It's what we're great at. Don't want to deviate from

I'd say we're probably 95 percent self maybe a couple percentage still have some insurance involvement here or there and we're actually starting to be sought out by some PBMs and insurance companies to see how we could work together on a compounding medium but in a more equal and fair balanced manner versus here's your provider manual, you could either sign it at that reimbursement schedule or not.

So it's getting 

really interesting. Let's put it that way.

Mike: There's no apologies for narrowing your business. I know even with the show here, my little hobby, it's like, on my questionnaire, it's like, do you have a hundred thousand in revenue? I mean, I know that's not killing it, it just gets away from some of the people that have an idea that they're.

Pulling out or they've sold something to their aunt Mabel or something like that. And now it's a business. Nothing wrong with that. It's just that when people are listening, though, they want to know who they're listening to. And there's a million things like that , marketing firms that want people to have at least this million dollars in revenue and , if you're not, we'll be happy to send you a newsletter, but you've got to focus or you're nothing to nobody. 

Brett Pine: So I see here, you're a third generation pharmacist and , what, what comes up in our world a lot is, , now you have a third generation pharmacist, but there's not a fourth generation one coming in and you're now owning a pharmacy, but there's going to be a day that your horizon comes in where it's time for you to. Step down and enjoy the fruits of your labor. That's a lot of, a lot of times that we're starting to see come our way now is people who don't have that next generational interest or, or pharmaceutical background to take it on. And those are the people that we know legacy is really important to. I bet your family and their pharmacies or however you guys interacted with it. There's a legacy component that was involved that , like myself, , you put that much into it. You want to still see it flourish, even if you're not. Financially your ownership is related to it. I still want my pharmacy that I used to own and operate to flourish forever. I wish nothing but the best for it. If anything and, know, when people reach that certain time where it's time for them to go, and it's not always age driven anymore. , we talked to

people who are

In their forties who are there's 

some people that are 10, 25 years older, but might be ready to go, but who's going to take it on after them. And they'll end up having to seek out an acquisition in doing so. 

Mike: Yeah, I'm pretty sure this is the end of our road here. I've got a number of kids, but I've told all of them. I said,none of them have really thought about pharmacy that much. And one or two that did. I said, look, only go into the pharmacy. If you love the science of pharmacy, if you love the thought of working at a few different places don't go into it though, for, for this, cause , what used to be volatile 20 years ago meant you don't know what's going to happen in the next.

10 years. And then it went down to five years and then it went down to like, Two months of volatility. I said, don't do it because of that. So I think this is probably the end of the road. When I do hang things up, I've got some kids that like the business part of it, but I think in Michigan, I'm pretty sure 25%.

has to be a pharmacist and like, I just have the one store and if it's not good, maybe for my lifestyle, but we're open nine to five. And if all hell breaks loose, if a pharmacist calls up and says, , they're in the ER for something, it's like, yeah, I can, I can drop this thing. I was going to do it this afternoon.

I can make it work. But , if you're not a pharmacist, what are your odds of finding a pharmacist in hours to cover a shift like that? Then you're closing. That just doesn't make sense.

Brett Pine: My father he's retired now. My father owned independent pharmacies in Chicago, which is how I got interested in it And, I definitely remember the times where it was last minute. He's just running. , he'd be the pharmacist in charge of certain ones and work as many hours as he can.

But. You can't ever do it yourself. 100 percent yourself. And invariably, someone is going to get sick. Someone will be on PTO. Someone will have an unfortunate last minute emergency. And , these patients still need their medicine, but you also have to make sure you're going about it in a compliant manner.

And , it's a lot. When I was a kid, I remember my father saying that, , for independent pharmacy was a dying breed, but what's interesting is how it comes full back full circle back to compounding is, you 

know, the reason so many, in my opinion,

Many independent pharmacies compound because they need to define their own niche and their own, their own groove to keep going to. To find a competitive advantage against the big box chain pharmacies. , they weren't ever going to sell enough Advil and enough pop, and enough of those oral tablets too, with the compressing reimbursement rates. So they had to find something that they could do that was special and unique. But also serviced an actual. specific type of patient need, whether it's a, , I did veterinary medicine for a long time, which was actually super enjoyable. Plus , your patients don't talk back to you. but , a lot of pharmacies had the business acumen to realize what was coming.

And I think most did see what was coming as they tried to reinvent themselves in different areas. So whether it was specialty or compounding or compounding for men and women's health or hormones or veterinary medicine. And , so many of them exist now because that was how they got their research strategy to battle that , big pharmacies here and big pharmacies there just moved in. And without mentioning names, , , one one group of pharmacies has 7, 500 locations. Another one that's variably at least one's down the street. So how do you invent yourself in a way that you don't compete with them? And that was how I got into pharmacy. I was like, I don't want to compete with them.

I hope they do great. I wish them well, I want to do something they're not going to do or not do very well, and I want to be exceptional at it. And we were very 

fortunate to do so.

Mike: My late father, we had a car place burned down across the street from us and this car place that was of family friends forever. I don't blame them, but they ended up trying to sell the land to Walgreens. The neighbors didn't like it.

We didn't say anything. The neighbors just didn't want two pharmacies on one corner, but my dad, I remember he'd always say that he's not concerned about a chain coming in. He's concerned about an independent coming in and doing things a lot better than we could do. It's a different market.

And that's really, you'd like two good independence, a little bit further apart, unless you're in a very. particular, niche there, but that's who we don't want on the other corner across the street from us. So Brett, how many different buildings in the network? And I don't mean, , this company, how many actually different buildings are in the network 

Brett Pine: most recent brick and mortar Friday of last week. So we're very excited about that. I believe that was our 19th brick and mortar that we have coming in. We've had around 30 total acquisitions. We just closed on one about a month ago and we just closed on our most recent one on Friday, And so we have I'm pretty sure it's 19 operating brick and mortar locations. We look to only expand on that quickly and aggressively this year. 

Mike: So it's the network. And so are any of them called revelation pharmacy or are they all their own,

Brett Pine: As a core thesis, we don't change their name. We do have one pharmacy that we bought as a shell. it was a non operating pharmacy. I think it used to be a pharmacy and we renamed that RPC2B. RPC, pharma compounding. And then, two B is the B2B aspect. We do work with telehealth partners, and that is our telehealth sleeve. So that's one of our 

pharmacies solely dedicated to that. So RPC two B, revelation Pharma business to business pharmacy is basically what we call that. So that was the only one we renamed, but we didn't buy it in an operational state. As far as we look going forward, we continue to buy and acquire pharmacies and we will keep their name and that's part of our legacy. That we want to keep for the neighborhood and for their therapeutic area of what they've been known as.

Mike: And then the network, I know it's. internal network, and I'm not saying it should be, but do the customers see that network? like, do they know that there's other pharmacies associated and they could do this or that? I imagine those could be States away and they probably don't really care.

So they don't necessarily hear of the network. It's more just like, this is a compounding pharmacy. 

Brett Pine: I think the answer is dependent. Sometimes no, they don't care. It depends on what you're trying to provide for them. So if you're around a tier three, one of our tier threes are smaller pharmacies and you're trying to help them locally. , I think in those moments, it actually doesn't. Always benefit you by promoting the larger brand because sometimes they came to an independent pharmacy to begin with on purpose. It's small and local and we want to have that look, taste and feel and smell and all that stuff is the same bad channel. Same bad place. 

We don't want them to feel a change in those moments.

If we're going after larger practices that have multi therapeutic areas, and they're going to need sterile capabilities, you kind of need to work with A larger pharmacy that has a larger menu of offerings and capabilities. And sometimes those clinics are going to bring in patients from a different state or across, across the way. And in those moments when they are looking at multi therapeutic lines, we will bring in the idea of a larger network. But I will say this, one of the things when we start working with larger practices or larger partners that we do push is redundant backup. So redundancy is important to us because if there's one lightning strike in the whole country today. And it hits our pharmacy A and that pharmacy A is serving a thousand patients a day. Well, those patients still need help. And what we're able to do is move it to pharmacy B and make sure that we have redundant backup on capability, compliance. Product, output shipping reach and accessibility and, and uniform pricing in those moments. So redundancy and redundant backup is is key to our larger partners because you don't really have an opportunity to have downtime. Perfect, example, I'm in Chicago and it's cold today. Well, I see two of our pharmacies tomorrow are in very bitter cold and could impact the efficacy of our

Brett Pine: for the safety of our staff, the state safety of our products, quality and control. And we're moving a lot of those 

Mike: All right, Brett. I'm thinking of compounding and I know that all businesses have competition and sometimes we think of competition as just like true competition, like another pharmacy. But I imagine there's competition like, Hearing about compounding versus not hearing about it and going with just standard stuff.

I imagine there's competition with people not comparing prices, just not wanting to pay that much for their condition, things like that. Where do you see your biggest competition or competitions in your network? Thinking about all those different kinds of things, not just strict competitors. 

Brett Pine: In a self pay market, obviously, we're not going to have a 10% copay on our products, but we do want to make them economically feasible. So I think pricing is a competitive aspect that doesn't have to do with the competitor, but an overall perception of the industry. So 

I do see that, where I

The challenge that we get to put into place is everything we provide is not commercially available until it's not commercially available and then we can fill a gap. So, so here's what it looks like is going to need, therapeutic outcome in in their hormonal balance, especially 

women who are pre and post menopausal

their bodies are starting to fluctuate in a way where they cannot produce the right amount of hormones that they were used to, and it's not one hormone. And it's multiple hormones in very specific titrated strengths that do not exist in the market. So, that's when they're going to have to decide, am I willing to not pay my $10 copay, but get products in one specific dose at an economical price? 

That's custom specifically made for you. I think that's one way that we would combat it if we had an open discussion about it. Now we do have other competitors out there. But as it relates to commercially available products, , Each individual product only has a, has a, has a finite number of SKUs and strengths that are associated with it.

Whereas compounding away that ceiling and allowing an openness to make whatever strength you want of certain allowable products, I would say one thing that differentiates us is the quantity of testing and costs that we put into our compliance, because the last thing we do. We'll allow ourselves to put something into the market that we know is not 100 percent efficacious, going to therapeutically make a difference.

And then we got to stamp our name on and stand behind. So , pricing is always going to be something there. , whether it's McDonald's and Burger King trying to figure out whose fries cost less, we're kind of the same thing if we have other compounding pharmacies that we work against pricing will be a big part of it.

But I think service. Yes. Consulting and education capability accessibility is 1 of the biggest parts of it 

Mike: if a compounding company was not interested in long term success, if they weren't interested in the five year plan, but just a one year plan to make things look good, might a compounding company do? And I'm not saying anything illegal. 

I'm not saying compliance wise. 

Mike: I'm not talking about cutting corners. Well another way to ask it is: What parts of compounding may take longer to be fruitful and it is a five year plan versus a one year plan?

Brett Pine: going on in the market today is probably the most perfect example of a short term versus long term plan. And that's in the GOP market. weight loss 

, GOP is very very revenue driven, great margins a definitive help to the country. And patients who are in need, especially from a weight loss perspective, you could see positive results in short periods of time. 

 Once you figure out how to compound it, you can be up and running very quickly, but at the same time, we know that once that becomes commercially available formally. when it comes off the shortage list properly, , that's when it stops. That's what our allowance is.

And then the allowance So from a one year plan, we're seeing a lot of pharmacies, pivot from their core competency of, of compounding or just start that weren't compounding before and say. Man, I could push a million bucks in here that I would have never done in three years time. I could do it in six months, get in, and at some point it's going to stop and then I'll go figure it out then. that that is a very short term drive. priority. What would stop people? What would be a barrier to entry gating items is fertility, for example, is very relationship driven, and it's very hard to break into those relationships in certain therapeutic areas. It is so relationship driven, and there's such strong relationships in place that you have to believe that you're not going to break through the day.

Once you better have a lot of patients to get there. And you also need to know that if you don't break through enough you won't be there in the long term. and I, and I believe that compounding has a lot of sticky relationships because providers have to really believe in the pharmacy they're working with. They have to know that they're going to create a positive extension of them with their patients. If I am Dr. Pine and I'm referring. to Mike's pharmacy. I better believe Mike's pharmacy is going to make me look good. And they have to develop that relationship. You don't flip flip that switch too often. So, , a lot of times it takes a long period of time to land new providers because you need to show them what you're capable of doing. 

Mike: It would make sense to have a company like your step in, especially as things seem to be getting bigger in the world and more networks and things like that. What else are people doing besides going with a company like yours? I'm not saying go with yours or your competition, but there's things like they just close.

They sell to maybe a couple, a few guys that are up and coming pharmacists. What do other of these companies do if they're not going to go with a bigger network, a company like yours, for example.

Brett Pine: for a couple of pharmacies in Illinois the other day that I knew very well back in the day. And I researched one and they just closed up shop and they were, they were the pharmacy in Illinois for a long time compounding wise. And I was shocked that they just closed, , I, I'm surprised they didn't go try to find someone to acquire them.

And there's a host of reasons why that would happen. I think another thing that happens is we see a lot of these compounding pharmacies sell to a chain pharmacy where they sell their records in the form of a book of business. And those chain pharmacies do a very minimal Oh, amount of compounding, typically non sterile. But they believe they have enough of the ability to do so. And they'll go and sell their files, their prescriptions over to that pharmacy. So that's another thing. And then other times we do see startup up and coming younger generation people that want to get in, but don't want to start it from scratch.

And then they'll go ahead and buy where, 

in the insurance world.

Mike: So some of the insurance companies, that's their vertical integration of owning the compound pharmacies and then paying for that and all that. You're talking about some of these PBMs even, are the PBMs buying, I know we always talk about these three major PBMs. I know there's fifty of them , are they buying compounding pharmacies and doing that forced, forced whatever compliance and so on? 

Brett Pine: There's definitely a pretty, pretty large multi site compounding pharmacy that was in a number of states. They acquired it, they wiped out most of their sales unit cause they realized that they were getting a lot of the prescriptions by default. so they kind of go and do what they think is best for those sites, and I'm not here to judge if it's right, wrong, or indifferent. Sometimes what we see is their competition gets so big, they prefer to just acquire them and work with them. There's other times that they're like, man, I really wish we could figure out how to do that, but instead we'll acquire it and we'll let that keep running. That'll work 

in the background. We'll keep our retail side of it, but now

offer a specialty side on the compounding aspect. That way they get both sides of the house, which makes a lot of sense from a business move.

Mike: Years ago, you probably know the name, but there was, the medicine shop and the way I understand the medicine shop, we had this guy that opened up pretty close to us , one of those, and he lasted about 10 years or something. But I think their thing was your pharmacy should be open from 10 to six and from nine to 10, that's when you're detailing doctors, things like that.

What is the recommendation from your company? Is there a similar thing? I'm sure you guys probably teach some of the marketing, what's the balance on that as far as time and what percentage of your week should be doing this or that, what would you call it, what are the best practices?

I guess as far as the marketing of those. 

Brett Pine: That at our size, we know how important operations are. is. And we can't take time away from operations. We need to make sure that we also have plenty of time to sell, but not interrupt our operations. So we have. dedicated sales teams that I have. So instead of dedicating a certain amount of time a day. Our pharmacies are open from X to Y and our sales people are selling that whole time as well separately from the pharmacy. So, , we have, 

whether it's to continue rapport, build new rapport and get new physicians in the network. It's not that we can't cross paths, but we don't want to take away from being able to serve the patient properly and then take away from being able to serve more patients as well. So we keep operations and sales who work very well hand in hand, but we don't typically carve out a certain part of the time. That we normally would be in a pharmacy and we take them out. I will say the one caveat to that is our general managers and our picks are, they're just very knowledgeable.

They're in tune with the providers. They're in tune with their patients' needs. And what we do like to do is while still having a full stock of people at the pharmacy, we will every once in a while have a GM come out and work with our salespeople, either in person or with them to just go talk to some of the providers that already know them. You end up hearing a voice long enough. Sometimes it's nice to see the face as well. So we do have a really good op sales handshake. I like to call it cause we work together. We can have the best sales team in the world. If you don't have good operations, it really doesn't matter because nothing's going to move. or if you have the best operations team, but sales doesn't know how to create more opportunities for them, they're going to have nothing to fill. So , we have to work in tandem for success. So sales will drive the process of bringing in referral base, having prescriptions come in, maintaining that base while also growing and operations handles the consulting sleeve of it. The workflow of it and making sure accessibility is. large, but quick and quick is in turnaround time. And turnaround time is really key in compounding. Although, although we don't pour something out of a bottle, pounce it by 30 and then bottle it, we create something that we know needs to have 30 doses in it.

And then after we create it, we put it into a bottle and it takes more time. People that need our products because they're not commercial doesn't mean that they have extra time to wait for their therapy. They went to a doctor for a reason. Cause something needs to work on fixed change, altered whatnot.

We're here to provide that better outcome, but we need to do it quickly. So although it might seem like we can just pour it out of a bottle, we've got to make the product that goes into that bottle, but we don't have the luxury of waiting too long, but we also can't go too fast because quality is of the essence.

So it truly is a, , tandem work together, handshake type of movement, but we do try to silo ourselves in so much that. We try not to bother operations too much because they have so much going on taking care of the patient and operations will work with us and we need to on the sales side and vice versa, but then sales will go and be like, I need to go push more more volume over to that pharmacy to make sure they're taking care of plenty of patients and stay, , business healthy. So , it's a fine line. We all walk, but it's very similar and different. It's in different business mediums, but we have to continue to make sure that we have a very strong source that the rapport stays high, but we also continue to build new relationships.

Mike: what's your most remote pharmacy, would you say out of all those, let's say 20 brick and mortar, what's your most remote, which one has the furthest of another network pharmacy close to them? 

Brett Pine: We have one. away from another one. If 

not more. 

Mike: You don't have a sales team there. You don't have boots on the ground. You're doing this from your, from your headquarters, or do you actually have sales people that are there in Alabama?

Brett Pine: A whole great slew of States now, Texas and California might need to have more than one in there because those States are huge, but yes, we do have boots on the ground in multiple States, every state. No, but a lot of our salespeople have multi state territories. So. Let's pretend I'm one of our sales representatives and I live in Chicago.

Well, I'll cover Illinois, obviously, but I will also most, likely cover Wisconsin and Michigan, Indiana. I at most, I think four states is about the best mix of a lot, but not too much because if you, if you get their territories too large, They don't have enough time to fully concentrate on all of the physician offices that they need to concentrate on.

They would be too diluted, but we do need people to have boots on the ground. So if we do have a remote location in Alabama in Birmingham, , although I might not live there, that doesn't mean that I can't go and try and service the clinics that are surrounding there and other clinics that might be able to take advantage of our services that we offer.

Mike: So you have a sales team out there, they got all these states, what percent of the revenue is, I don't know, walk in versus mail out, 

Brett Pine: I'm guessing we're probably in the 80 plus percentile of shipping out. There's definitely some people, 75 to 80%. I'm , a lot of people are wanting the Amazon experience,

They want to make it quick and accessible to get what they need to stay healthy, but they don't have a lot of time to go. And physically pick it up. So why not have it delivered? , that kind of goes back to the accessibility aspect. Does that mean people don't pick up on that?

That's not what that means, but , the pharmacies that you and I grew up in, it's not like that anymore. , you don't have outside of like the large chain pharmacies, , a lot of pharmacies don't really want the front end. They don't want to have a wheelchair to sell. They don't want to have Advil to sell.

They don't want to have it. cough because they also know someone could click two buttons on their phone and it'll probably be there in three hours. So I think a lot of the independents have gravitated to a medium where they're maybe not trying to bring people in as much and then put the pharmacy in the back of the store. So you have to walk through all those aisles. Oh, I want that. Oh, I want that. They want to make it accessible, easy to work with, with intelligent educated pharmacists behind them that can, that could give them the information they need, but they want a quicker experience 

Mike: Some pharmacies can get into The habit of thinking people want something a certain way. Let's say your pharmacy delivers, for example. and maybe there's some PBM laws where you have to get signatures but the old school would be like, well, no, they want the delivery drivers to go knock on the door and give it to Mrs.

Smith and say good day to them and do this kind of stuff. And it's like, they thought? I mean, do you want yours? Amazon driver to come knock on your door and, , pick up your newspaper for you and hand it to them, or do you just want to like, let it happen and, , I mean, sometimes people can get into these older thought patterns.

Like everybody loves this. And some people, frankly, just do it that way.

Brett Pine: Yeah, you're very right. When I was younger, I mean, shoot, I started from the ground up literally, , in a basement, stickering , candy. Well, there was a day that I would deliver stuff to and, , people would want to interact with you a little, a little more 

than today. And then I'd get my 25 cents a tip and I'd. But , I feel like we are right now. Yeah. The faster I can do it and the quicker I can receive it, the less effort and energy put into it, unless I want that that moment in time is typically what we're seeing more often. I want to be able to order my meds.

I want to refill my meds. I want to do it really quickly because I don't really want to spend the time on it, or I might get lazy and not do it, which I'm a perfect example of. Yeah. And I want to deliver to my door and I don't necessarily need to talk to the delivery person, but the people that do want to speak with them, that's where we make ourselves fully accessible on the consulting side. 

Mike: Brett, how's your company actually set up? How many people do you have? I know you're at home. people are on the, I guess we'd say not the medical side, not the pharmacy, the pharmacist, clinicians, all the people that you mentioned there.

Brett Pine: What do you got as far as your team, as they would say? We're probably almost 600 people strong at our company. I'm on the corporate side, so. that enables me to, to work from home. I don't need to be in a pharmacy to do so. Obviously the people that work at the pharmacy, they need to be in there. So I'm not sure the exact number, but we do, we have a legal team and M&A team, a marketing team, and a full sales team. 

We have an HR department. All of them are able to work remotely. We are actually at the very end of building out a beautiful new corporate office in Atlanta. So a lot of them will go there to work, but from a requirement to work in a pharmacy versus not all people will work in the pharmacy unless you're at the corporate level and then they could bounce around. So I got to think about the guessing here, maybe a quarter of us are able to work remotely at any given time. Because the people that work in the pharmacy. For compliance and for our need to service our patients, they need to physically be there. 

How many people are reporting to whom? How many people are reporting to Sean? Is it? Does that ladder go up? 

We have an executive team and then a senior leadership team and then director. So the way it works is so I'm the executive team. So I report to Sean. Our executive team consists of 6 people. So us six report that's including Sean. So five people are reporting to him. I have a team of five people that are all vice president level in senior leadership that directly report to me. And then , the vice presidents will have anywhere from three to six people reporting to them. After that, we get down to a director level to director level. Their teams could get up to about six to seven people. And then after that you get kind of pharmacy level people. That doesn't mean that it's just pharmacy level people. It's just kind of how they're going about. And at the pharmacy level. You could be a pharmacist or you could be the pick or the GM pick as in the pharmacist in charge, and then you. could have that whole whole body of staff report to you. As it goes on the corporate level, we try to not have teams be too much bigger than four to six people. So you make sure you don't ever get stretched too thin or pulled in too many directions that you can't be an effective

Mike: I'm always surprised at some of these companies. I suppose revenue and profit dictates that, but you always hear about these companies. It's like, , we have steel cases in town, , it's like, they've got this many people and they've just cut off like 20 percent of this or that.

And it's like, well, we're. Either those people weren't doing anything or the people that are remaining there are going to get burned out or something. and you don't have the choice. Sometimes you just have to do it. Or if, , you're a, and your new product doesn't get clearance or something like that, it's just always amazes me how they can just like, and not only that amazes me, but I down the highway and you see one of these big companies and it's like, know, there's no product in there.

It's just a. Bunch of shufflers. And it's like, there's hundreds of people there and it's like, they're just moving papers around. I always wonder how much fat is in places and this and that. So that sounds about right. Six people. As you get bigger than that.

you start losing things.

Brett Pine: I'm never here to tell people how to run their business, but I do believe in lean and mean, but I also think that if you ever get too lean, people are going to get mean. But, 

When I owned my pharmacy, I bought the pharmacy. There were about six employees when I sold the pharmacy.

We had about 32. And when you're an independent, you'll notice you start just wearing so many hats. It got to be a lot. , and I will say I feel the team I have, you. I know, I, I learned over the years that you're only as good as the people around you. Cause you're only one person.

You could do a lot, but there's only 24 hours in the day for one person. 

 I do believe in coaching and mentoring and giving people an opportunity. There's been many, many times in my life. I didn't know the right way. And if I didn't have to ask the right questions or have the right leadership, I probably wouldn't have found my way. And people are willing to take that time for me.

I want to make sure I take that time for them.

Mike: Yeah, I was talking to, uh, one of my guests and it was right after the assassination attempt. And we were talking about how, , in Congress and I guess rightfully, so you don't see this in pharmacies so much, but it's like, whoever was responsible for this. , who's getting fired for this. I was talking to my guests and it's like, I'm not saying that's wrong.

You just don't see that in pharmacies so much. And part of it is because you have too much of that attitude, you run the risk of people not bringing mistakes and possible mistakes, if you're too quick to do that, people fear that they don't bring stuff forward.

But I suppose, in some places it's more so than even, , you're not worried about can, can this. be made. It's just like people are looking for heads and it's symbolic of this happening. Someone's got to pay for it. They're gone. And I wasn't necessarily complaining that that was wrong. 

 It's just not something we're used to in pharmacy so much.

Brett Pine: I think it's interesting to point that out and I don't disagree. , there's this thing I used to always say, and I really think it has some weight in it, is in healthcare, not just pharmacy, you're Perfection is, is expected and needed because you really don't have room to mess up a medication to mess up, diagnosing someone to mess up, , in surgery, but we are human.

And I think that a lot of people in healthcare really try to pick each other up versus having that, , one throat to joke. mentality. I get why some people have that. And I think that it's part of, you know, where we are as a society today is let's look for someone to blame. But in health care, we're all trying so hard to make a positive difference while doing our job well. If you're consciously worried about screwing up, then you're probably not paying proper attention to just going about your business, using muscle memory and doing it right. But then slowing down and asking a question, if you're approaching an error. I truly believe in the no bad question mentality.

question is the one that you don't ask that creates a mistake or an error And in our 

world, an error can create. And so that's why there's not a lot of room for air in it. But I think healthcare is a lot of people that are wanting to make a difference, but are willing to work with people together in the workplace or for patients to make that positive difference.

And I don't think a lot of people sit there thinking about air or a mistake as much as doing what they can do to the best of their ability. I would hate to have a surgeon working on me. They're constantly worried about screwing up because I don't think they're paying the proper attention to do it right. I trust in our of, of the pharmacists and doctors that we all work with and the pharmacy technicians and everyone in the labs that if you do the right training, you ask the right questions, you're willing to put in the sweat equity more often than not, you're going to come out the other side pretty well.

Mike: I guess a lot of times there's decisions that are made where maybe somebody has to get their head chopped. But a lot of times I think, well, in healthcare and pharmacy, you're not making a ton of decisions when. When something goes wrong, it's usually an error.

It wasn't a bad decision. And then so much of that is just the, what do they call it? Systemic, if an error happens in pharmacy, quite often it's, it's systemic.

It's like, did we not have enough people on where the phone's off the hook? Because even an individual error is. Almost always something to do with the system. And I guess that's maybe where it's different from some of the things like I alluded to the assassination attempt or something, or I guess, I guess in that case, it's like, well, who's in charge of the system?

Maybe that has to change.

Brett Pine: I definitely could see how air can be part of a larger framework, But I think in healthcare, they put in so many safeguards that if an error occurs more often than not, there's enough safeguards in place that I'll catch it. If they continue to happen, then I agree with you.

It's a system, but look at how many. Different people and a computer will get their eyes on checking so you receive a prescription Someone's gonna work on and check it for accuracy Then someone's gonna check that script for the actual label for accuracy Then someone's gonna compound something in our world off of a specific recipe and it's gonna get checked off by a pharmacist Then you're gonna have a finished product product and it's gonna get checked again So if you look backwards the amount of double checking that's occurring 

Is so high that you're creating the lowest for an error. So if you have air starting to get thrown through and they're multiple, it's normally not an individual. It's a system. 

There's no such thing as a company that won't mess up an order, it's, I wanted a large fry and I got a small fry, I wanted Diet Coke, I got a Coke. I wanted 10 extra syringes, but I only got five. Things will happen, but how you observe and see how that came to be is how you make yourself better in the long run. And as long as you learn from those, don't learn the hard way twice. 

Mike: your doctor's comment made me think of the joke of what do you call the physician that graduated last in his class? And the answer is doctor. you don't know if you're dealing with the top guy or the bottom one. So, 

Maybe that's the value of, certification, , instead of looking at their exam scores, but who knows,

Mike: I want to tell that joke in the field. 

Brett. Someone is listening to this now and they pull into their driveway or they pull into the store and they've finished up and they've got it a minute or two on their hands.

Mike: What would you like from them? 

Brett Pine: First of all, I would want people to go to our website to see the services that are out there and people that are either in pharmacy or looking to get into pharmacy or learn more about it. There's a lot of great education out there that can be had from either working with a company like ours, working with patients that have a need. And I think the education out there creates an opportunity for us as a society to help people get well and get well for a long period of time. And I think people that are able to go through the information that we have out there, it'll show the educational pieces and the resources available for them too. figure out how they could better help themselves in a business sense or help themselves in a medical sense and see how we do things to see how they could either replicate it or join us. Quite frankly, 

Mike: Hey, Brett, thanks for joining us. It's fun to get in the world of that. It's kind of fun to see the backside of things and how companies are conglomerating and growing and things like that. Helping along the way, our brothers and sisters who are owners of some of these companies.

 I know you came from that and I think Sean came from that. so that's cool to see, what has happened in your world coming from those kinds of establishments. Brett, I know you're busy. Thanks for 

your time. I appreciate it. Our listeners do, and we'll look forward to keeping in touch.

Brett Pine: well. It's been, it's been great. 

You've been listening to the Business of Pharmacy podcast with me, your host, Mike Kelser. Please subscribe for all future episodes.