The Business of Pharmacy™
April 5, 2021

Why RedSail Technologies Purchased PioneerRx® | Kraig McEwen and Jeff Key

Why RedSail Technologies Purchased PioneerRx® | Kraig McEwen and Jeff Key
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The Business of Pharmacy™

Why and how RedSail Technologies purchased industry-leading PioneerRx® https://redsailtechnologies.com/our-brands/#pioneerrx

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Transcript

Transcript Disclaimer: This transcript is generated using speech-to-text technology and may contain errors or inaccuracies.

Mike Koelzer, Host: [00:00:00] Hello guys. Hello? Hello. For those who haven't come across you online, each of you introduce yourself and tell our listeners what we're talking about today. My 

Jeff Key: name's Jeff Key. I am the president of PioneerRx, uh, pharmacy system, uh, targeted to the independent pharmacy. .

Kraig McEwen: I'm Kraig McEwen, and I'm the CEO of red cell technologies.

We're here. Talking about how we help independent pharmacies continue to be great. When's the 

Mike Koelzer, Host: first time you guys met 

Kraig McEwen: Archbishop? Yeah. So just a year ago. Yeah, just before a red sale closed the acquisition of . When 

Mike Koelzer, Host: was the closing of pioneer with red sale? Early December. So you guys haven't had a lot of personal time together as far as in the same room and you may not ever 

Kraig McEwen: even less than you think.

Jeff Key: It seems like a lot because there's been a lot of learning and then it doesn't seem like a lot, lots of, uh, video conferencing. Right. So it seems you can put your best face on rather than chilling. 

Kraig McEwen: Pretty much several hours every day, almost. 

Jeff Key: She's trying to get to learn. Everybody wants to know everything.

Craig, 

Mike Koelzer, Host: how much time did you have in the pharmacy operating system or pharmacy management system? How much experience Craig did you have in that before you were either welcomed or thrown into the system back in last March 

Kraig McEwen: and in the pharmacy technology space for, uh, since roughly, roughly 10 years, ISIS started through pharmacy health systems and we took a portion of a McKesson business, private, uh, and, and then following that was the co-founder of a business.

Specialty pharmacy technology space called trials are acts, which, which I'm still very much involved in, uh, chairing that board. And then, uh, subsequent to that, the pioneer relationships. So broadly speaking, 10 years in pharmacy technology, independent retail, pharmacy technology, it's only been about a year.

How about you, Jeff? 

Jeff Key: Yeah, so th the Dixon's, uh, Mr. Dixon, the generation above the Dixon's today, you'll always be Mr. Dixon. You'll always be Mr. Dixon. I know how that goes. Mr. Dixon went to MIT after he got out of the military and found computers there and decided pharmacies needed computers and was one of the first people to put computer systems in a pharmacy. It's called a new tech computer system.

They developed a Unix-based system called prism. So that system, they had converted to a Lennox and had about 500 customers. They had tried to replace it twice. They had tried to build version two. They had tried to build a new version, not a power builder and had failed. And they brought me in to build a new windows based pharmacy system.

So that was about 13 years ago 

Mike Koelzer, Host: because your schooling is in developing, 

Jeff Key: correct. You have an undergraduate in electric engineering and my graduate degree in computer, actually computer systems 

Mike Koelzer, Host: technology. How did they get ahold of you to pull you 

Jeff Key: in? So I had worked for a couple of companies, had some patents, was making some residual income and took a couple of years hiatus to teach college and continued education.

So home was Shreveport Louisiana in the companies that I had worked for. They're one of our struggles with getting good developers. So the state was spending some money on development upon, uh, education. So I took a job at the local university four years ago. To improve the quality of the students coming out of the programs, both on the continuing education side and the computer science side.

So I taught senior level computer science. I taught continued education in Microsoft development databases and software development. And the new tech brought me in to teach their four or five developers how to develop a modern system. They had decided that they needed to build a new thing. And in Microsoft technologies and the Dixon who was in charge of that area was very hands-on.

And he actually sat in some of those classes and he really liked what he heard. And he asked me to dinner and said, Hey, can you come help us build a pharmacy system? Well, what's the 

Mike Koelzer, Host: decision that you came in saying, all right. Yes. We want to go to Microsoft. We don't want to do Linux. How did he know Linux?

Wasn't the system. And believe that Microsoft was. Yeah. I mean, that was my 

Jeff Key: skillset at the time. I mean, generally most business development was built on windows 12 years ago. Some of the Linux [00:05:00] development would be standard than that. And in that you're either going kind of open source Java tools, which are pretty immature at the time.

Or you were going into Microsoft stack.net. And most of our internal stuff was.net. Uh, was 

Mike Koelzer, Host: Microsoft. And then Craig, I don't know much about the QS one system was on Linux or what system was that? 

Kraig McEwen: The original QS one system was a similar, the original programmer 

Jeff Key: guy who started. probably one of the very first pharmacy systems.

Both of 

Mike Koelzer, Host: these came from wholesale backgrounds. And that's how they knew that the pharmacy needed it. Computer so 

Kraig McEwen: much uh, started with the technology before the wholesaler. Yeah. Actually the system was originally built and the first application for the system was utility billing and municipality billing.

Then they moved the technology into pharmacy because they need pharmacies as well. I find the history of, of, of healthcare technology in general, just fascinating. 

Mike Koelzer, Host: The Q S one came in, they were already kind of a system before Smith kind of brought them on and said, let's get going on this. Let's use this for pharmacy per se.

Kraig McEwen: Well, he was the inventor. Oh, he 

Mike Koelzer, Host: was the inventor, but he didn't even use it for pharmacy right away. They 

Kraig McEwen: started initially in, in local municipality, uh, billing for the town of Spartanburg, city of Spartanburg and yeah. Yeah. It's perfect. Just amazing, you know, innovators, inventors and entrepreneurs.

Just amaze me. You take, you know, PE people like Jeff and he looks at what Jeff built in such a short period of time. It's really just amazing. I'm always 

Mike Koelzer, Host: Thinking of creativity is starting something new for the first time, but they say that real creativity is seeing something in another area and then using it for something else instead of reinventing the wheel like that.

So, Craig, what other system did red sale have? Do they have another one too, besides QS one red 

Kraig McEwen: cell purchase? Uh, what was James Smith called? The Smith technologies corporation Smith technology comprised three businesses. Integra and Integra is a long-term care software solution. Uh, retract and Docky track.

And then in addition, a company called public, which is still utility and, and tax billing software. Um, and so from a pharmacy management system in the QS, one business, there's really two, two primary, uh, software systems, which is NRX, which serves predominantly, uh, retail and prime care, which serves predominantly long term care.

Mike Koelzer, Host: You guys are both going about your business, Craig, you were involved but more on the business side of things. Cause you're not a developer at all. Yeah. 

Kraig McEwen: I listened to what Jeff tells me we should do on the technology 

Mike Koelzer, Host: front is, and Jeff, you were doing everything with pioneers. You are, but you're. And developing because you came in, then what, 12 years ago, as a developer now you're the president.

Where'd you pick up the skills along the way to be the president? Because I imagine those are different skills between being the top developer and the president. 

Jeff Key: Yeah. So I was brought in to build a business. I wasn't brought in as a developer, I was brought into to 

Mike Koelzer, Host: build the business. You knew the development and that's why it was a good match, but you were brought in to build the business.

Jeff Key: We'll look at a lot of successful companies and the lead of that. Company's technical. Absolutely. Whether that be gates or, you know, he's an electrical engineer. So a lot of times, one of my statements I would have said is that technology companies should be run by technologists. Right. Because they understand what you can do, what you can't do.

So is that typical? It's funny. Cause a lot of times I'll introduce myself as a non-typical precedent, right? 

Kraig McEwen: Yeah. It's more, it's more typically than not actually, if you, if you, you know, uh, red cells owned by Francisco partners, if you look at the Francisco partners, all they do is invest in software technology, across industries, but uh, more typical than not for software companies, the CEO is a technical or a degreed engineer, a CEO, for sure, not a vast majority, but a majority, particularly if that company has the same CEO from, from founder on, through the scaling, the scaling phase of the business, 

Mike Koelzer, Host: It really seems you have to have that almost because.

The days would be 72 hours long. If the software side had to explain everything that the leader comes to them with these wishes and stuff, and you guys probably know closer up front, like what can be done without going down a path forever until someone stops and says, no, we're not going to go that route that would take forever or cost this, or it's just not [00:10:00] feasible kind of thing.

It is 

Jeff Key: good to have an understanding of all parts of it. And a couple of things helped me. I was raised in sales. Um, my dad was a car salesman back when it was still a professional thing to do. We didn't listen to the radio in the car. We listened to sales tapes, zigzag, et cetera. So, I grew up with a lot of entrepreneurial thoughts.

That's the way to the top to eliminate stinking thinking. You can have anything you want in this life. If you just help enough other people get what they want. So a startup company, for sure you need product and sales and then figure out how to treat people right in support, which is education. Hm. So I had some sales, I had some technology and had experience with education.

It sounds like a good fit, right? And, uh, I was fortunate to have in four years of teaching come across what I consider to be exceptional people and were able to talk them into coming for our team. So a lot of the initial employees were former students either on the continuing education side or our.

Education side. So guys who got more than just, Hey, I want to do some zeros and ones that I really got, I want to solve a problem for somebody. 

Mike Koelzer, Host: So, Jeff, what was your task when you came in with Morris Dickson, they had a program and when they hired you, what kind of goals did they set out for you? I don't mean exact numbers, but it was the goal to get a better system, a bigger system.

Why did they actually bring you in? 

Jeff Key: So the goal that they approached me with at that dinner was to build a Windows-based version that replaced the functionality of their existing Linux-based system. And I had been reading good degrade and some other books like that. And, and, um, really I came back to them and I said, Hey, if the goal is to have a windows pharmacy system, I'm not really interested in that.

If the goal is to have the best pharmacy system to build the best pharmacy system in the world, Okay then I'm good. You know, I don't want it to just be a checkbox of, Hey, just do this into windows and what they were running into the time as a McKesson was given away when a based system in order to get drug business.

Oh, I see. And they were losing from sheriffs because of that. And well, what I told them is it's going to have to be gold would be the best, which means you're going to have to not be wholesaler specific. If it's just a Morrison Dixon product, you'll never be the best. It's got to be nationwide. Their product at that time just sold in nine states.

And, um, they went away and came back and they bought into all that. And they spent their money to do that. Really. They never, until the end, they never took a dime out. They invested all the profits back into it. And I remember we, uh, we, it took us about two years to build the base. We came out of beta the year after beta, we put in 14 systems, kind of a post beta.

And I said, okay, so next year I'm going to put in a hundred systems. That's our goal. And I want to have 1500 systems in five years. So I kind of set my own goals. The, uh, my boss at that time, Mark Dixon laughed out loud. I think uncontrollably, like it was accidental. And then I felt really bad about it.

Because he's a really nice grandfatherly guy. He's like, yeah, you know, it's nice to have goals, you know, stars in the sky. Right. But if you can't do that, it's okay. Just, just best. Well that year we put in 98 systems and we hit 1,505 in two months. 

Mike Koelzer, Host: Wow. What was the year you hit the 1500 about maybe 

Jeff Key: 2012.

Kraig McEwen: Mental Rolodex 

Mike Koelzer, Host: 10 years ago, 10 years ago, probably the McKesson system was there as branded to not necessarily be with McKesson or did people know that this was like McKesson's system? 

Jeff Key: Yeah, they were born around that time. And given away 

Mike Koelzer, Host: enterprise that was tied in with McKesson, you knew that they were together.

Yeah. 

Jeff Key: McKesson would come in and McKesson a drug guy. Hey, switch your drugs. Uh, we'll give you credits to pay for this pharmacy system. And they were giving them away. 

Kraig McEwen: It worked beyond, beyond just McKesson, but, you know, McKesson was in the pharmacy management system business and selling drug contracts, not the pharmacy management system business.

Mike Koelzer, Host: So you were tasked with saying, we've got to get something that's better enough to have people pay for it, not be free, all that kind of stuff. Right. 

Jeff Key: We won many, many of the contracts against the free, 

Mike Koelzer, Host: That's a good aim to, you know, shoot for that. I think we all, well, pharmacy is, you know, bad at that, but shooting above free because then you usually come up with something [00:15:00] decent.

Cause it's easy to give stuff away. You 

Jeff Key: Now, I talked to the pharmacy of the day, they're trying to give him no costs then to give him some hardware. Then they give him several months of stuff. And he likes looking at that and going, wow, they'll never get their money back. And I'm like, Hmm, what are they doing?

They're getting that money. They are getting their money back and they're not a charity. So. I think about where they're getting it and, and maybe, uh, maybe you'll figure 

Kraig McEwen: something out there in multiple industries. You know, years ago I was in cardiology, radiology. We used to compete against free.

You see free all the time and in pharmacy, but to Jeff's point, if you're running a business as a loss leader for some other business, is that loss leader business intended to be the best of anything? 

Mike Koelzer, Host: No, it's not. It's not forward-thinking, it's not a lot of things. Yeah. 

Kraig McEwen: It's in, what's intended to do is minimize the amount you have to spend in it so that you can get the other business.

Mike Koelzer, Host: So now I understand. Got in then with what he's doing with pioneers. So contrast what he did with your system. So you came in not developing, so you weren't brought in to make this a new system, like he wasn't. So how does that contrast to yours? My 

Kraig McEwen: background is healthcare technology, broadened cardiology, radiology for the first half, and then pharmacy for the, for the second half.

Um, and for the last 10 years, I've run companies for Francisco partners and we, we come at it a little bit or I, I come at it a little bit differently and we, we first try to find a market that we think, um, is a, not only attractive, but be, uh, ripe for some type of disruption. And. That you can solve a really meaningful problem by going so, uh, right.

You, you don't, you don't just invest in technology for technology's sake. Can you solve big wins? So we have been looking at the pharmacy management system space, uh, and independent and some change based for quite a few years. I've, I've looked at probably about every, every player in the market and we come at it and say, geez, what's interesting.

For 30 years, more than 30 years, people have been saying the independent pharmacy market is going to decline. A Walmart got into a Walmart is going to put them out of business. That's the end of it now. And Amazon's going to put them out of business and, uh, and what you realize it's a really resilient, resilient market.

And there hasn't been a lot of what I'd characterize as massive shifts in business model. Uh, and, uh, and so we come in and say, well, gee, the problem, I think red, sale's trying to solve. I think we do a good job. If we look back 10 years from now and say, if you were part of the red cell network, we solved a couple problems that are really core to independent pharmacy.

The economics for an independent pharmacy is not sustainable enough. And the care that independent pharmacies are providing can be dramatically better than what the larger chains are incented to do. And, we actually think we can help solve both of those problems. And so there's a portion of pharmacy management system technology that there's a bit of, how do you, you get enough independent pharmacy scale, and then I'm characterized as another.

Element of additional investment in other technologies, try to bring that all together. And so that's what red sales is trying to do. Um, and one of the steps was trying to make sure that we had the best pharmacy management system, uh, out there and not just the team that has demonstrated an ability to continually innovate, uh, in this space.

And so Jeff was proactive. You know, Jeff didn't, didn't go run a big process, uh, when pioneered and signed to sell, uh, we were chatting with Jeff for a bit. And Jeff, Jeff was looking for, uh, I think, uh, others like him that wanted to go solve similar problems. And we really gelled around a lot of those discussions.

Quickly around kind of what could we go and what can we do with these businesses? That's a bit different, I think, than what's been tried in the recent past. And so that's how I got here. And, uh, I've stayed partnering with Francisco partners because, um, we've done that a few times in, in similar related markets.

And so it's a lot of fun number one, and it's, um, meaning all to go, try to solve, uh, some of the, some of these big problems. So any type of time we invest in a particular market, we start. What's the big market disruption that we're trying to accomplish here? Um, and I think part of ours is making sure that we create a financially sustainable model and enable, uh, independent [00:20:00] pharmacy that is more clinically advanced than any pharmacy network in, uh, in the country.

And I think that's possible. 

Mike Koelzer, Host: So, Craig, do you work for Francisco? So Francisco 

Kraig McEwen: partners owns red cell technologies. Gotcha. Red cell technologies, uh, were created and purchased. All of QS one and Integra and the public from the Smith family. And then red cell partnered with Jeff and purchased pioneer from the Dixon fence.

Mike Koelzer, Host: Was there a company that helped in the middle, like bring your companies together, like a merger team or anything or not? That's just Francisco, Francisco that's Francisco. Okay. Okay. That makes sense. Would it 

Jeff Key: use that person as well? And then he was Goldman 

Mike Koelzer, Host: Sachs. That's why I read Goldman Sachs. So then they meet up Goldman and Francisco 

Kraig McEwen: Typically the way the process works is, um, usually when you're selling a business, the scale of, or pioneer, the owners of that business in this case, the addictions usually.

Uh, an investment banking firm to help them through that process. Gotcha. As Jeff went through, while you're trying to run your business and go through the process of selling a business, uh, it can be pretty time consuming, but I do 

Mike Koelzer, Host: deal with it. Jeff Pioneer made the Dixon family make the first move by saying we want to sell pioneer.

Jeff Key: Yeah, I think it's, it's more complicated than that. The, um, the Dixon's had almost sold everything the McKesson about three years 

Mike Koelzer, Host: earlier. Oh really? 

Jeff Key: The Dixon's were concerned about the whole opioid problem. 

Mike Koelzer, Host: Oh, interesting. Um, 

Jeff Key: And that didn't work out. It wasn't a good connection, but it got the pioneer people thinking about the future.

And as we really looked at it, the man, the pioneer management team we'd actually talked to McKesson, talked to probably a year before Craig got there about doing something together, we realized. We could not, if we didn't save independent pharmacy, independent pharmacy, didn't transform, we didn't have a business.

And we looked to do what we were trying to do independently. We did not feel that we could do it in a timely enough way on our current trajectory. Right. We figured we could get to where we needed to be on this kind of scale in about 10 years. And so we went to Dixon and said, you know, I actually emailed and said, we think that the management team believes we would benefit from different ownership.

And so a lot of times when you're selling a business, as amazing as pioneer X, you'd put it out to bid, right? You hear everybody come bid this. They didn't do that. This was a closed deal. They invited one company, they talked to one company and that was the company that the management team, pioneer management team felt like, um, would be the best for independent pharmacy.

So even in the end, the Dixons who didn't take any money out of it didn't make as much money as they could've made someone pioneer that they could've made more. They chose what they thought was the best for independent pharmacy. And for the business, 

Mike Koelzer, Host: did you know all the good people at red sale and all that when they were merging?

Is that what you said? This would be a good team or was it more like we, like what QS one has with their customers and their vision? So let's do that. I know it's one in the same, but which one did, you know, more of which one led in that category of saying this is going to help us be the company we need to be, you know, the market 

Jeff Key: size of a , but really the people that we were enamored with was the team that Francisco partners as Craig, uh, the strategist, a girl named Francis, they had put together a really, really strong.

And so it is not just the access to more systems, right? And the things you can do with scale there, but you're looking for a team, you're looking for people who have experienced that you don't, you're looking to put other pieces together. And that's something that, that, uh, the red cell group has a history of doing, uh, successfully.

Mike Koelzer, Host: Jeff. When you say that you couldn't get there for so many years, what slows that process? Was it money? Was it market share that someone already else had that it would have taken you longer to show them that your system was superior? Would all that just take too long? How come you couldn't make an impact sooner?

So 

Jeff Key: one of those is just the speed at which pharmacies are willing to change. So here today is the leading selling independent pharmacy system, the country, about 50% of people who choose to change or do something good with it. A lot of things are about network adequacy. [00:25:00] So if I'm trying to get, if we're trying to get pharmacists in better networks, right by, by helping them help their customers choose from a subset that can go to their pharmacy and therefore creating competition within that subset, you've got to have a good percentage in that state.

So you go to states like Louisiana, North Carolina, pioneer alone is, is the majority of the pharmacies in that state Montana, but network scale, where you can actually help offer programs and things like that really comes with probably around 8,009,000 systems. 

Slow 

Mike Koelzer, Host: That's down for me. Jeff, what do you mean by network?

What kind of networks are you talking 

Jeff Key: about? Payer networks PBMs. 

Mike Koelzer, Host: You're saying pioneers can help get pharmacies into certain networks. Certainly. I'm not familiar with that. What do you mean by that? Is that like, I mean, I'm always thinking that is like a PSA or something. How do pioneers help get people into networks?

Kraig McEwen: Step back for a second? You say, what are CVS and Walgreens doing? They've vertically integrated, vertically integrated the market. I'll argue with anybody on whether that has resulted in better clinical care or not. Um, but, but they've early vertically integrated the market. And so what does that mean?

That means they now are able to push markets around because of the size and scale that they are. Then we think of, think about a red cell, a little bit different. We've got a pharmacy network as large as either of those players. Now we're not choosing to vertically integrate, but we're choosing to integrate and create solutions where we can shine a light on what they're actually doing better.

Right. And what is that? That in my opinion, it's clinical care across a lot of disease states as. And, and we have the wherewithal to then aggregate that across states within states, and then take that and act like that larger player in those states and say, wait a minute, this doesn't make any sense to me why you're excluding this block of customers that we're able to prove to you is providing superior clinical care and you're excluding them from the network.

Oh, you still don't want to. Okay. We actually have a technology that can disadvantage you as a payer in that state, and we've got enough pharmacies to do it. 

Mike Koelzer, Host: That makes perfect sense to me that that's the case. I just haven't seen that marketed from, and maybe it just went over my head. I haven't seen that marketed from a computer.

Vendor before. And maybe it's because in Michigan we don't have much problem getting into networks. I mean, they're all terrible. They all stink, but we don't have a problem getting into them. Is that the case? Maybe that, because we're getting into them that that's why it just isn't front on my mind that the computer processing would help with 

Jeff Key: that.

At the beginning of the year, there wasn't an independent one who was in a preferred network. Are you in preferred 

Mike Koelzer, Host: networks? Can Michigan be our preferred network, we pay nine bucks for every prescription for a preferred network. Would it be good if you would get a preferred network? It would, but not if I'm paying $9 to the network for every prescription, I filled out PBMs 

Jeff Key: use preferred networks to steer patients to different pharmacies because they believe those pharmacies are going to be better for them in some way.

That's what they bought into. Yeah. Imagine if those payers believed that you would be better for them. Lower cost of care, et cetera. What if they also believed that the, that there was highly competitive, the five plans or 10 plans that you went to, your pharmacy were highly competitive and they need to compete with each other to have a better plan for the patient.

Yeah. So if you could create that environment, you could create an environment that would have a PBM, trying to steer people to you, and then trying to compete within you to be a better plan than the other plans that also allow people to come to you. 

Mike Koelzer, Host: You guys know better than I do. That's a great plan. I just haven't heard.

I just haven't seen the computer vendors acting in that regard. 

Kraig McEwen: You're right. You know, it goes back to, we were talking about, uh, inventors and founders and innovation. You can innovate a technology solution. You can also innovate a business model. And I'd say you're what you're seeing red cell start to do is not only leverage pioneer to innovate pharmacy management systems.

Part of the reason we exist is to innovate the business model in pharmacy. That's our job. We look back five or 10 years from now. We're going to measure ourselves on how successful we weren't doing that. That business model existed. Once we closed, once red cell purchased pioneer and had , that's the business model we're creating with.

We 

Jeff Key: probably talked to six companies in the last two months, since [00:30:00] we closed , saying things like, well, we've only done business with chains, but Hey, got scale. Now we're interested in talking, 

Mike Koelzer, Host: This is coming. This is the red sale. This is your guys' goal to say that we're going to become a force.

Now the new model is we're going to put together some pharmacy services and so on that are going to be this new thinking. That's going to make for better care and so on. So PBMs are going to be kind of standing in line for people that have this new technology, because they know how much it can improve patient care, then save money and those kinds of 

Kraig McEwen: things.

Yeah, I think, I think that's true. And I think if you go back to when we were talking earlier, when Jeff and I first met and we were, we were sitting in, in the pioneer office. With, uh, Francisco partners and myself and the Dixons and Francis, this is the discussion we were having saying, Hey, do we all believe in this and this hypothesis that we can create this if, if, if we get, uh, enough network adequacy and, and if we do okay, that starts to get really exciting again, fast forward until December.

And we're, we're not trying to make it reality. 

Mike Koelzer, Host: That's really exciting because right now in pharmacies, when they talk about size, it's like, all right, there's maybe a size difference, but it's only a size difference because we agreed to buy from this wholesaler. Or we agreed to say we're part of this buying group or something, but you guys are coming along with.

Yes, it's a size difference, but it's a size difference for a reason. We're all joining this because we can do something better. It's not just who you join. And that's really cool. 

Kraig McEwen: I think that's a really important point, right? So we could choose and go down a PSA O route. Uh, but, but I think there's also a theme that I think pioneer has done an exceptional job doing not only innovating, uh, the pioneer technology, but also, uh, doing it in a way that one, uh, nurtures the independence of independent pharmacy.

There's a reason they're independent pharmacists, right? And like, they liked that independence, but then designing the workflow and the technology so that you, you can practice it at, at best of class care, just using the system like you're supposed to use. Right. And so I don't think you necessarily need to be a PSA to do that.

And in fact, I think it's much more effective if you build the good practice of care into the system, let the system make sure that you're providing that information service before the pharmacies. So we then can shine a light to the, in this case, we're talking about the payers say, Hey, this is the group of pharmacies that actually practices the best care.

And sure, not only should you let them in your network, but we can also go, go take that quality of care and. Turn it into a competitive environment for the PBMs. We think, because we think the PBMs are going to value that or the, or the payers for sure, because we see the data in our system and we S we see what's 

Mike Koelzer, Host: happening.

So what are some things that you would sit there with a PBM and tell them, look, this is why we're more valuable. What's an example of that? System-wise 

Jeff Key: it depends on how the players aligned. So if the payers align to the health care side, that's easy, right? You're working on adherence, you're working on making sure the right medication, uh, you are talking right medication, getting them to a non-formulary medication, making sure they're not taking the wrong medications, a big new thing.

That's coming now, med wise, which is making sure the medications are timed properly during the day. You can have a massive difference in the patient's outcomes based on the timing that Hey, twice a day. She doesn't necessarily mean two of them, eight o'clock until one o'clock right? Because of how those conflict with each other, you carrot a stick on the PBMs is highlighting during the season of enrollment, who the better ones are for the patient and for you and having a system that drives it to the best plan for you and for the patient, that's kind of a stick.

You also have other payers, you manufacturer who's out there, pay manufacturers interested in adherence. They're interested in the patient getting the drug that was prescribed, not the one that the PBMs are fighting with them over, over again. Um, plus outside of the whole drug world, you've got the health plan, right?

You've got, you know, services based and interesting. I was kind of controversial in, in an innovation board meeting not too long ago. And I said DRR fees really matter. Sure they're kind of an interim way of cutting down a price. But our biggest problem is that [00:35:00] drugs that used to cost a couple hundred dollars cost $5 now, and we're paid based on percentages.

So in the end, we've got to find a new model. We gotta get paid for something different. One of those is being a tele-health extension. So I knew, um, thing just today at a Kaiser Permanente, 95% of their patients have tried. Tele-health 85% of them said, Hey, we're willing, we're going to choose tele-health for our next GP visit.

And so I have a saying that I think I, that it, maybe I did, but that it, it's kind of funny. It's circular. You think about it, but people who don't use tele-health, haven't tried. Okay. And kind of wait. Okay. Yeah. If they haven't tried it, have you used it? But the point is that once people try it, they generally find it convenient to keep using it.

It's going to be a big play for pharmacies in being a tele-health extender that telehealth providers can't do a flu test. They can't do a strep test. Can't do a COVID test. They can't do an allergen skin test. And so there's going to be a big play for independent pharmacies in that place. I can go to see whether that might just be my blood pressure check once a month, cause I'm poor or et cetera.

So, so big roles for new money. None of that happens without technology. 

Mike Koelzer, Host: When you talk about the time of day stuff, does that tie into your mobile platform? That's in the customer's hand and there they'd scan something or whatever that, and then you would be able to prove to the PBM, like, Hey, they're taking this every 12 hours and not three hours.

Good. 

Jeff Key: Absolutely. But you could see a pharmacist being paid to analyze and adjust the time of day that a patient's on. I mean, getting back to the stuff you learn in school, right? Actually how the pathways, how these things work. I love the car parking example, right? Certain drugs want to park in the same space.

And so it'd be taken at the same time. One of them is not going to be effective. Whoever gets into the parking space first. So you've got to spread them out a lot, or a lot of our patients are walking around and kind of in a zombie state because they're taking stuff too close together. Time-wise. 

Mike Koelzer, Host: Grouping groups by their pharmacy system would seem to be huge because we know just grouping pharmacies by the amount of pharmacists in the bike room doesn't seem to mean a whole lot besides numbers, but those can float around so much.

You got some people that might say we're grouping by pharmacists that really care. You know, it's like, well, all pharmacists care. It kind of depends on what, who they're owned by what system and who they focus on. So that's, that's really cool going with the technology 

Kraig McEwen: focus. We were talking with a buying group not too long ago, that was checking our interests for particular, for a particular program.

And Jeff and I were asking kind of, well, what success looks like, and the answer is oh, five or 10% adoption of the programs. Great. That's terrible. Like how could that possibly be the success? What if that's really what you want to do then build it in, build it into the workflow of the system. Make good practice of care equal to that, and then you get more adoption.

And to me that that's a, that's a core difference between trying to drive this through a technology lens versus just, uh, a grouping of buying interest lenses. I think there's a very, very important difference there, uh, because that can, that can cross states that can cross disease cross physical states that can cross disease states.

It can, it can, um, it can take a lot, a lot of different, different, uh, manifestations just based on how you're trying to drive, drive the information flow within that system. And I think there's not anything that's occurring in pharmacies. That's not linked to that system. So we're capturing it all. The question is how well are we then pooling it and making sure that the payers and the manufacturers are giving independent pharmacies their fair.

Mike Koelzer, Host: Everything's captured through technology. I mean, arguably maybe not a twinkle in your eye, even that can be measured though, by customer feedback and a rating scale and everything is going to go through technology. It seems 

Jeff Key: it's going to have to be an amazing independent pharmacy going to succeed with technology.

That's not as good as Amazon's. And so if you really look at the play you got to have, you gotta have great technology. Technology has to allow you to do what you're trying to do. Almost accidentally. 

Mike Koelzer, Host: You have to trip over it, basically in a good way and go around. 

Jeff Key: And a lot of time trying to find stuff to do, oh, let me, let me do I need to do this?

Let me, let me look at doing it. It needs to be right there. And, pioneers, we're continually working. We've got a program right now that pays the pharmacist to go over a printout with a patient on a new drug that they have when they first get. [00:40:00] Manufacturers actually pay the pharmacist to do that, to make sure they get a good education.

We started off with a 5% adoption just to find we just made a modification that we have about 25% completion. We expect our next modification to be 60 or 70% completion, rather than make it easier, where it's almost harder not to do it then to do it. And you can do that with technology.

You can't do that with 20 different technologies. So you do it because they say, Mike, if you don't do this, we're going to fire you. Right. And even at that, they don't do it. Great. And I can tell you when some of their stuff, we have motivated people, but technology has to help. So, if you look at CVS, bringing people together in their employment by threat of firing, we're bringing a group together by technology.

That's when that group together, we can go to a manufacturer and say, Hey, our pharmacists are going to do this. What will you pay them to make it really easy for you guys to do it? Where is X you're getting paid? Does it hardly cost you anything at all? And then get hundreds of those 

Mike Koelzer, Host: One phrase I use in my pharmacies all the time is like, guys, like when we made a mistake, I'm like you guys, how can we trip over this next time?

So there's absolutely no way we can do this again. You know, you'd be surprised on what stuff you can put in front of somebody though. It's still usually me, you know, missing something. Jeff, I heard you on another program. And you said that when some software was bought or something like that, there was, I forget the number there was 26 or 30 different variations of that software.

And there was like no way to update that. So one of the keys is bringing stuff together to make it more of an effort. Does that ring a bell to you, Jeff or not? I 

Jeff Key: now it sounds like I was talking about one of our super powers with, with pioneer exit. We did very early on. It made sure everybody was on the same version of the software.

That 

Mike Koelzer, Host: was it. So 

Jeff Key: we created an auto updater where it automatically updates. Very easy to roll back one, if it's a broken database, always backwards compatible because of that support is easier. Uh, you don't talk to somebody on the phone and tell them, oh, this thing you want to do, Mike, it's done. All you can do is upgrade five versions ahead.

And it's like, no, last time I did that, it broke. I'm never upgrading again. 

Mike Koelzer, Host: Yeah, that's right. And then people don't do it forever. 

Jeff Key: Those discs as a coaster, whenever you send them. 

Mike Koelzer, Host: My wife does that. She did that with her iPhone. She had an update. It was probably like three years old, you know? So I use it for Sumption.

Don't don't press that. I can't update it. Don't update it. Great. Now you have and let's say you have a pioneer, let's say you pick up some other ones, red sale. How many systems do you want? Would you rather everybody go to one? 

Kraig McEwen: The whole country is a pioneer. That'd be, 

Mike Koelzer, Host: That'd just not be going to happen right away.

Kraig McEwen: Or, uh, you go back to what Jeff talked about on, on how things, the, the length of time it takes for farming to convert. You know, I think the answer is that there's, there's two, two different, uh, paths you go by on this one. You make sure that we're, uh, giving people all the good incentives and sh and shining a light on, on why pioneer is such an innovative system and the things you can do on, if you look at what Jeff will be coming out with here shortly, uh, around COVID as an example, uh, and, and vaccine management, I think it's a great example of that.

Um, so that's step one. Step two is to make sure that we can give you some of what you can get with pioneers. As an example, we think that a lot of the mobile applications and messing up applications that upline here has, would really benefit the QS one, uh, customers. Right? And so you're gonna see us move to do that.

The third piece is to make sure that we, uh, Take care of the QS. One customer, we continue to invest, particularly in support. We do things like as soon as we lock you, as one looked and saw that they're pretty close to those 27 versions that you were talking about. 

Mike Koelzer, Host: I think what Jeff had mentioned. 

Kraig McEwen: Yeah.

And you know, we've got them to three now we'll get them the one here, uh, in the next six months or so. And that goes a long way to how to improve the support level. So make sure we're taking care of the customers, good support and giving them good paths to conversion, to be able to practice a top of license.

There are some things you can do in QS one or in pioneer that you're just not going to be able to do in QS one. And we got to make it easy for you to, uh, to move to the best technology. Uh, in the country and from our perspective, that's great. We're, we're, we're willing to be, uh, patient and supportive of it because either way, you're still a red cell customer.

And we'll do that. The only, the only, uh, other item I'd highlight is the long-term care segment where we're [00:45:00] actively investing in a next-generation long-term care pharmacy management system that we'll be launching in the market here in, in a few quarters. Uh, and, and so we're, we're, we're very excited about that as well.

So that, that would be the only, only subset exception to the concept of, of moving everybody. So 

Mike Koelzer, Host: Right now it's just two pioneers. Oh, 

Jeff Key: has a, an old, an 

Kraig McEwen: RX. Yeah, QS one. Technically, if you're out in the, in the total install base of Q as one, there are four pharmacy management systems today. They 

Mike Koelzer, Host: merged and they've, they're bringing along their little family of them.

Kraig McEwen: No, they just got launching things. Uh, the original system was RX care. Plus there's still, there's still some arch GIC. It's a character based system. There's still some of those out there that the majority are on NRX. Uh, some are on a newer platform called sharper a very, a very, uh, few, and then the long-term care solution is, is prime care.

Um, and that's, that's a true long-term care, uh, solution. And so we'll very, very rapidly try to try to, um, move sharp, our action RX care plus, uh, over to pioneer and the interact folks as well, continue to support and our extra 

Mike Koelzer, Host: sure. Was there a system itself called Q S in RX, 

which 

Jeff Key: is that one product, a lot of people called QS one.

That's how they, how they did that. But the things that you will see pioneers do and red sell and do even more of is doing things that are in the best interest of independent pharmacies. Yup. An individual may not feel today that that's in their personal best interest because they're independent for a reason, but we are true in the belief.

And this is one of the reasons we love Francisco partners. If they are designed, there's some models out there, the Gorgon gecko, right? You buy it? Yes. Break it up. The pieces are worth more and they're very aggressive. Francisco partners believed. And it's gotta be a success for the customer. Successful employees, Ana success for the owners are, you're not going to have success.

If you don't build, if you don't shoot for that, as your goal is not gonna be successful, but some of that's going to be any, you may have seen in the past the plan here, we roll out with seven different options. You know, the installer comes in and tells you 12 different ways you can do it because it's been a pharmacy system.

I think you're going to see more and more. This is how we recommend it. You want to think this is how you should do it. This is, and you're going to see things optimized. A great example of that is an IOUs versus the partial fills, right? Partial fills the right way. The white way with insurance is the right way for everything else.

You'll have people doing partial fills and they say, well, I wish he would keep up with whether or not it did it in the Wilco. Okay. That's partial fills. Yes, those are what are over here. And you're going to see that with pharmacy systems. You're gonna see that as you know that they're saying, Hey, are you going to support all these forever?

We're going to do what's in the best interest of our 

Mike Koelzer, Host: custom. I think that's an easier sell because all of your customers for those products are all independent pharmacies. And so I would buy into that, you know, if they say some, do it this way, some do it that way. And it's not like I'm saying don't set it this way, because it was probably set up that way for the chain stores they have, or it was probably set up that way for this thing they have.

If I know that a company is setting it up a hundred percent for the independent pharmacy, it's like, yeah, if everybody else is doing this way, I'll get used to it. I'm agreeing with you, Jeff, that I'd rather have. Six different options to do something. I'd rather have you guys do the dirty work for me, pick the best one.

Say, Mike, this is the best one. People like you'll get used to it. I just watched a documentary on, um, max, a movie software, you know, they were doing all these programs up until like version seven. Then they went to version 10 and they said, this is a good way. They're doing it guys. Five-year-old kids are doing this on your cell phone.

So I think sometimes people like the beauty of something being difficult. It's like, no, let's do the one that a five-year-old can do. Yeah, 

Kraig McEwen: That's right. If you, if you look at the pioneer, was it two, two features a week? Jeff 

Jeff Key: roughly means I'm more than that, but 

Kraig McEwen: why is that model so well liked, well, because it's very focused on the needs of independent pharmacy.

That's the right way to do it. If I tried to do that and get the QS one, engineers are really talented engineers, by the way, to do that on the older versions of the QS one. In some areas, one line of code is equal to a thousand lines of code in the older systems. You can't do it. So I could continue to try to tell a pharmacist, Hey, we'll, we'll continue to support that.

Even though we'll never be able to come close to meeting your expectation, your need versus saying, look, what you've really got [00:50:00] to do is go.pioneer 

Jeff Key: this week. We'll roll out defaults for vaccines because we used to do four a day. And now you'll have days you're doing 400. So it's probably not okay to go to a different tab and choose what aren't you put it in.

So we're going to roll out. Defaults are going to default to, Hey, the administration dates, the fill date that it's the left arm. It's intramuscular. Right. And, he thought that there's different. Go change it. It's not different. We'll roll at that this week. Next week, we're gonna roll out something different.

We'll roll up a pop-up form. And within the next two weeks to put some of those fields in. So, uh, you're gonna have some independence that says we always choose the right arm. I don't know. Maybe we're not going to put in an option to what your default has left on her right arm. It's going to go out of my left arm.

And so let me some of those kinds of things that, you know, you're hitting the what 95% 

Mike Koelzer, Host: of the people, it seems there has to be a percentage or else you're going to drive yourself batty, because if you make too many options, it would take forever just to set up all the options. Yeah. Just give me defaults.

I'm good with defaults. As long as the part that makes you independent and independent talking about growth, will that be a two-edged sword, Craig? Well, you guys will continue to want to grow. But a year from now, all of a sudden I'll come back to you and you'll be crying. And you'll say, Mike, we just got 30 different computer systems.

I mean, cause now you just have QS one, which has a couple or three you'd want to grow by bringing on a hundred different acquisitions of smaller companies. But then you've got all these people that you've got all these systems again, you'd have to get them to pioneer pretty quickly. Cause you drive yourself batty with more than a few of those.

Right. We we've 

Kraig McEwen: talked about narrowing the number then the number of farms managed systems. And we've also talked about, uh, how do you leverage the network adequacy to go drive meaningful changes in the economics and access to patients for, or pharmacies? I don't think adding another two or three. Small pharmacy management systems go at solving that big problem at all.

I think we should invest in two or three areas. You're seeing us, uh, continue the pioneer investment. And if anything accelerates it, you're seeing us invest in, uh, in the next generation long-term care solution. And you'll see us make investments probably inorganically or through acquisition in areas that really align around the clinical care within pharmacies.

I think that's a far, far better solution. 

Mike Koelzer, Host: Your goal, which I agree with, would not be to pick up 50 pharmacies by buying some smaller software, because then all of a sudden you're screwed because you brought another program on which you don't want. And, it's not worth those 50 to get that you'd rather make a better system and hopefully give those 50 people a reason to choose a pioneer from the start.

Kraig McEwen: Absolutely. We've got, we've got good network adequacy. Now we've got the best pharmacy management system now. And so now we can turn our attention to, to investing in driving those services and programs that can really change, uh, the clinical care and economics for, for the pharmacies that we've been talking about for the last hour, that that's where that's, where you'll see us spending the time.

If that 

Mike Koelzer, Host: makes sense, you'd drive yourself. Yeah. 

Jeff Key: You have to think vertically, you may buy some other companies, but they're not going to be a pharmacy software vendor. I'm thinking that that synergy helps, you know, CVS out there doing it. Right. You have Optum just bought ARX. So you want to try to buy complimentary businesses.

That compliments independent pharmacies and makes the whole business stronger. And when I say the whole business, I mean my business and your business, 

Kraig McEwen: I think a great example that you'll, uh, you know, I think you'll see us really study. Can we make a true imp uh, a true differential impact with a telehealth solution, uh, alongside pioneer ma maybe.

I don't know the answer to that question just yet. I sure think so. Probably. And you'll see us spend a lot of time studying that very, very quickly and making some decisions on that, you know, where do we think the puck needs to be for independent pharmacy in five years? W we were very planful, Jeff and I were talking before we closed the acquisition.

Right. So we had a pretty good vision of where we wanted to go, uh, on, on that prior to closing either of those acquisitions, um, and felt like we could execute. 

Mike Koelzer, Host: Even though pioneer and red sale didn't join till later. You and Jeff were already talking about whether QS one would be a good 

Kraig McEwen: system, red cells and discussions to buy QS one you're in due diligence.

But we were also speaking with, because Jeff and I had started talking and we were very much aligned on, kind of this vision for network adequacy and the types of solutions you could drive with it, but it would require enough locations to be able to get that done. Let's say 

Mike Koelzer, Host: right now that you two met.

And you didn't [00:55:00] have any of this company behind you, you know, for some reason it's in a different lifetime and, well, let's say this, you guys were so good that the company said, Hey, you guys, we don't want you anymore. You're so good to go do your own thing. However you want to paint the story. Let's say you're not with red sails and not with pioneers.

Okay. Let's say those two companies don't exist. You guys met each other for the first time with all your history, you know, maybe some funding, but no customer base or whatever right now, what would you come up with right now on your own? It probably wouldn't be saying let's go invent a computer system and get 10,000 customers.

Maybe it would be, but what road would you take right now? If you two met each other, had all your history together. But you are not working for red sale or pioneer, just the 

Jeff Key: behind the scenes. Craig's made a promise to his wife that his next deal is going to be to buy some local businesses, quite 

Mike Koelzer, Host: local, do not have you traveling around the country.

I mean, 

Kraig McEwen: Before I was traveling around the country, I've traveled around the world. Uh, so the improvement in the work-life balance was not being in Japan and Europe and, and everything, but with traveling across the U S um, uh, and I'm from Pittsburgh. And, um, I'm very passionate about helping to grow the local economy, but, you know, the way I answered Jeff and I would probably have had to meet after Jeff created his next innovation.

See, I, I think, I think Jeff and I worked so well together because our skill sets are complimentary. Yep. It's just the epitome of a founder innovator, great CEO for technology, a company. I'm not the guy that's going to build that startup. I've been the co-founder of trellis RF, which is a good, great business doing well.

Like the 99.9% of the credit to Andy Mauer and the team that's running that business. But I'm really good at market strategy and scaling businesses rapidly. And. I love meeting Jeff as we've met with pioneer, because I think pioneers, frankly, just still on the very early brokers, I also would love to meet Jeff on the next thing that Jeff is going to invent, kick around a couple of beers talking about how do we scale it for four more rapidly than you can on, on kind of a traditional model that I think where the real, real, the real fun for me is.

So 

Mike Koelzer, Host: what have you got inside of you, Jeff, if you weren't in this and someone gave you a non-compete in pharmacy software, and let's say that Craig didn't have a curfew on him and he could do a little traveling at least what would be your 

next thing. 

Jeff Key: If you look at the healthcare world, and I know it from the piece where I'm looking at it, I think there's a big need for somebody to step up on health information, exchange the clearinghouse for medical claims, the whole care plan, 

Mike Koelzer, Host: the care plan 

Jeff Key: to me, the real realization of the care plan 

Mike Koelzer, Host: is is, 

Jeff Key: is an information sharing mechanism 

Today, you see the care plan being used a lot for billing, 

Mike Koelzer, Host: I'm going to send it. Cause I, I did a med sync and this payer pays for that. 

Jeff Key: I really see it as a mechanism for data exchange, 

Mike Koelzer, Host: uh, at 

Jeff Key: A care plan holds your allergies, your drugs, your own, and everything like that. Imagine if, 

Mike Koelzer, Host: Hey, 

Jeff Key: this trading partner gets a copy.

If somebody abandons something, they don't pick it up. This person gets it. If they do pick it up, 

Mike Koelzer, Host: this person gets it. 

Jeff Key: There's a business out there for an intermediary. Who's sending all these things around the base for an event. 

that occur I 

Mike Koelzer, Host: was reading last week. I don't think it was medical, but it was something about at least having an information pod.

So no longer did social media, places own all this stuff. You have your own pod. So kind of a, a pot of healthcare that you're not re-inventing, the forms and claims and all that. Every time it's like a universal people that are maybe afraid of the term universal, but a database that is carrying all this, 

Jeff Key: But I am building something technical, that's why Greg would say he'd want to meet me further into it because he likes mid-size companies.

He liked taking a mid when the, when they, when they start that rise, helping them to rise quicker and, and, and stuff like that. And I, I enjoy, I kind of enjoyed all pieces of this journey. Uh, for me, I used to be one of those kinds of things that changed every four years. Well, I've gotten it, these things every four years, they just happen to be at the same place.

Your job changes after four years of a startup. And then maybe four years later, your job changes again because now everybody's like, oh no, what did we create? We got MBAs, right? They fire off the horns to bring in the MBAs and let's protect it. And if you're smart, you've figured out a way to learn enough that they don't do that.

And my 

Mike Koelzer, Host: late father would have loved you, Jeff, with thinking of that healthcare information, because in the later years of his life, he had bone cancer, but it would affect the [01:00:00] swelling of his brain. And he would forget a lot of things. But one thing he remembered is every time he would go into a new appointment that always asked him the same questions, you know, his birth date, his street address, all this stuff.

He's like, you guys have got to have this somewhere already. You just asked me this yesterday, you know, and this is the same healthcare system. They're all asking this stuff again. But it seems like, yeah, with all the forms you fill out for all the healthcare and college stuff, it's like, someone's got to have this.

I don't, Google has tried that, you know, with their Google health thing, but maybe people don't trust that enough. I don't know. Google 

Jeff Key: found at Microsoft. People really don't have an interest in managing their health information. Most people aren't going to go on a website, prove who they are. And then flag who gets what access to what there's a place.

There's a huge opportunity for pharmacies to help a patient manage their healthcare record and who gets, who gets access to it. People want 

Mike Koelzer, Host: it together, but they just want to give permission to someone like a pharmacist who they trust and so on. What would you tell. Couple of young punks coming out of college right now with maybe pharmacy, but maybe some developing skills, maybe some business skills.

What would you tell somebody that said they want to be sitting in your similar seeds? Not the same product and so on. 

Kraig McEwen: I got a 19 year old son by my nieces, uh, a 20 year old pharmacy student. So, uh, 

Jeff Key: We've been on a call where Craig's got a 19 year old son where he's like, Hey, come, you need to hear this.

That's a real world advice right 

Kraig McEwen: here. I give the same advice to kids coming out of school that long ago. I still do. I think it's really, really basic to get extremely passionate about something, um, work like hell to be great at something. Um, you, you've gotta, you've gotta be great at something and be really selfish early on in your career with learning.

Um, you know, I, I always talk about the, the very, the very first company I bought. I was going off to do diligence and I was way too young to be able to be leading this due diligence. I was like 25 years old. I got a great opportunity. And the CEO of the business said, Hey, I want you to meet this management team.

And I want you to have one sheet of paper on the left side, with tick marks. When they ask you a question on the right side, put a tick mark. When they make a statement at the end of the meeting, if there's a lot more statements and questions run like hell, because they're, they're, they're really dumb management team.

If they spend most of their time asking you questions, they're probably pretty smart because if you take the same two kids coming out of college, same intelligence, same work experience, but one of them asked 50% more questions their whole life think of the intelligence that they have and the knowledge they have compared to the one that wasn't intellectually curious.

It's staggering. So I think you have to build that intellectual curiosity and a basic work ethic. 

Jeff Key: I'm living the dream. I'm more passionate about what I'm doing than ever. I even got a little new bump, their independent pharmacy, I am a pioneer, the best pharmacy system in the world. So do something great.

And Craig and the team are amazing. 

Mike Koelzer, Host: I was listening to Tim cook from Apple the other day. And, uh, I'm not an apple guy, but I was listening to him or reading about him. I'm not an apple guy. I gotta throw that in. Just like when I tell people, it's like, when I'm talking about business stuff and money and it's getting into law stuff, and I say, I'm, I'm not an attorney.

And it's like, you didn't need to know that, but it just felt good telling somebody that I'm not an attorney, you know? No, but he said, if you go out of orbit and then come back and look back in an apple, ultimately it's going to be a healthcare company. People are going to say apples changed the health of the world.

Kind of thing. What's your comment on that? I mean, do you think that Apple will be known as a healthcare company, maybe with their mobile. Stuff and watches and ultimately that's going to be their future. That's a good 

Kraig McEwen: question. I just probably, I gave to, well, I've got an apple watch. It works, works pretty well, but mailing is, if you go back to earlier things, I don't have to do anything with it.

I do think that they do a good job of just making it happen. Uh, and, and, uh, that makes sense. I, I, if I asked that question, I'd probably say, no, I think it's going to be a small company that we don't know about yet. We like to view the Amazons and the apples of the world. Like it's, there's something really, really unique.

And we haven't seen this type of thing decades ago in the industrial revolution and everything. I think you're going to see those companies get out innovated soon. I really do. I think you're going to see them get out 

Jeff Key: innovated. One of the things that I've always told people to be kind of controversial because seems to be my nature sometimes is you're a technology company.

All companies today are technology companies. If you're gonna be a successful pharmacy, you're really a technology. Right. You're going to be a successful healthcare provider. You really gotta be a technology company because you're not into it successfully without technology. Here's somebody saying that a technology company is really going to be a healthcare company, which is kind of opposite to me [01:05:00] because you can't do it without the technology.

So they may choose in their technology stack to improve health. And I think that's great. I think one of those things that's going to benefit pharmacies is tests are gonna become cheaper. They're gonna become, you're gonna have a day. Somebody can come into your pharmacy and you can do a CBC, right? And you're going to have the equipment that is going to be cheap enough.

I was in a pharmacy a couple of weeks ago, and, um, they had a blood machine in their pharmacy that ran a bunch of different types of scans. They had a deal with public health to screen diabetes, Custer to do, uh, something with a group of diabetic, uh, customers. So, um, is a lot of technology we leveraged for health.

Sure. We spent a whole lot of our money in the United States. On health. But I think in the end, Apple is going to be a technology company today. You would say Apple as an entertainment company, what they're selling is entertainment, music, and you got the iPhone because it was cooler. You could play games on it.

You could do those things. There's being in the future. People will buy Apple technology because it's healthy and you've seen companies buy all their employees, Apple watches to track their steps and give rewards for so many steps. I think I could see how that makes sense. 

Mike Koelzer, Host: So Craig and Jeff, if you could put a feeling or an adjective on what your selling independent pharmacies, what would that be?

What feeling do you think that you're selling pharmacies? Interesting. 

Jeff Key: I think you heard somebody, not one of us say in a podcast, uh, just recently, uh, that all of the good things that need to happen in pharmacy, aren't gonna happen. If pioneer doesn't help, 

Mike Koelzer, Host: they're not going to happen. If pioneer doesn't help, there is 

Jeff Key: a future for independent pharmacy that their kids, I have people come up to me at trade shows and one with a son and a daughter, and both of them going into pharmacy.

Right. We've got all our eggs in one basket. Both kids are going into pharmacy. Is there a future? Yes, there's a future. If we make one together. 

Kraig McEwen: Great. What's yours? Mine was very similar. Mine was belief. I don't think we can just make independent pharmacies survive. I think we can make it thrive. I actually think it has all the elements to, to be, uh, the best place to get healthcare in this country.

It just needs some more nurturing, uh, and, and nurturing with a very aggressive push towards, towards, uh, amazing technology solutions. And I think what, what pioneers of algae, one good example of, of where you're going to see us continue to invest. 

Mike Koelzer, Host: I tell some of my workers, you know, you always think about the future of independent pharmacy and you say, guys, we've got whatever 12 touchpoints a year.

And you know, the main thing is people are dying of heart disease and cancer. I mean, they're dying of health problems. You know, even speaking about Apple, you don't look at Steve Jobs out of all the things that he had. It's his health that took them. There's a lot of room for pharmacy. We just need smart guys like you to keep leading 

Kraig McEwen: us and some great young students come out of pharmacy school.

I think you, you gotta keep feeding the, uh, the profession. 

Jeff Key: I enjoyed this one thing I've enjoyed mostly about these podcasts. Just getting to know different people. And you're one of my favorite people to listen to. Let's just give it to you. You're my favorite podcast to listen to. And, uh, you know, as far as pharmacy is concerned, I, I enjoy a lot of the conversations 

Mike Koelzer, Host: and I appreciate that.

Jeff, that means a lot to me. Sorry. I've never been here from harvesting. 

Jeff Key: I'm sure. It's amazing. I need to make it up there at some point. 

Mike Koelzer, Host: Well, first of all, thank you very much. That's flattering. And I don't know if you want to see the pharmacy. I'm better at sitting on my ass and talking than I am probably.

Jeff Key: Well, you're amazing at that. So that's a high bar, so you've set a high bar for yourself. All right. 

Mike Koelzer, Host: You guys, will you keep it up and we're eagerly waiting for your cool things to come forth. So keep it going. I really appreciate you taking the time. All right. Thanks a lot guys. Take care.