Why I don’t fear Amazon in pharmacy

 

There seems to be a good deal of trepidation among my fellow community pharmacy Superintendents and owners about when and how Amazon Pharmacy will commence operations in the UK.

 

First, there was the registration of the UK trademark and then some recent job adverts which at first glance appeared to be based in London, suggesting a launch was imminent but further inspection reveals they are roles at their Pillpac operation in Arizona USA …. phew!

 

That said, it does feel like it is coming pretty soon. I don’t think it’s a coincidence that both Lloyds Pharmacy and now Pharmacy2U have recently “hired bankers” to explore sales. I don’t know about you but this feels like a bit of a coincidence and, while I am no expert on these things, it looks like they are both effectively holding up a “Please buy me Amazon” sign, judging it to be a good time to be acquired by the online giant with seemingly unlimited resources.

 

Pharmacy2U would be a better fit but there are plenty of other distance selling operations that would enable Amazon to hit the ground running with an existing NHS contract. Given Pharmacy2Us costly false start at their new Leicester facility last year (excellent analysis of that here), Amazon may wish to skip past the pesky NHS control of entry mechanisms and the scrutiny that comes with that process. We should also not forget Amazon’s recent partnership with Morrison Supermarket on grocery fulfilment. They happen to own a few pharmacies themselves. So Amazon has multiple relatively easy points of entry to the UK market.

 

To some extent though I think we just need to stop wasting any time speculating on what Amazon may or may not do. We need to focus on our customer service and prepare.

 

Amazon has multiple relatively easy points of entry to the UK market.

 

So, you may be wondering by now why I’m not worried about Amazon Pharmacy?

 

Well, the journey of helping to build up 15 new pharmacies from scratch across Scotland and England as well as working on numerous health-tech projects which then led to co-founding MedPoint over the last few years has meant I have spent a lot of time thinking about what patients want and need. These are not always the same thing.

 

Call me old-fashioned but there is a lot that happens in the relationship between a good community pharmacy and their patients that simply cannot be replicated by a faceless distribution centre hundreds of miles away with a slick app. The unfortunate thing is that more & more, community pharmacies aren’t paid for all that they contribute to society, especially in England (don’t get me started on that topic!).

 

In Scotland, the term “ART of Pharmacy” has been coined to try to encapsulate what pharmacies can do when speaking to commissioners. Advice, Referral, Treatment.

 

We also have examples of sectors that Amazon tried and failed (so-far) to dominate. Not that long ago we were hearing about the death of the supermarkets as Amazon tried to disrupt grocery shopping.

 

It largely failed. Why?

 

It failed because existing operators adapted quickly and offered their customers the same level of convenience via home delivery service, click and collect and a smooth online and offline experience. So there was no significant advantage for customers to make the change en-masse to using Amazon for groceries and other household items.

 

Customers value being able to go to a physical store if and when they need or want to. This applies even more to community pharmacy given everyone needs face-to-face care and healthcare services from time to time. Yes, a monthly subscription-style delivery of your medicines sounds great when you are on a few stable medicines and nothing changes, but life isn’t like that. Invariably when there are complications and a patient cannot get through to their chosen online provider, who do they turn to sort it out?

 

That’s right, the local community pharmacy where they can go and speak to a human and be seen, heard and cared for. The level of “churn” of patient nominations at the larger online pharmacies demonstrates this.

 

That’s aside from the times you throw in the odd ‘Beast from the East’, Royal Mail delay or strike, and oh yeah, pandemics, just to mess with the supply chain.

 

These events served to demonstrate the value of having a distributed network of community-based pharmacies as it spreads the risk. What blockchain does for cryptocurrency, community pharmacies do for the medicines distribution system to draw an analogy from the world of tech.

 

Would large monolithic central hubs hundreds of miles away from the patient that rely on postal services have coped with shocks like that? It’s no big deal if those new slippers don’t show up on time but medicines are not something you can wait two or three weeks for.

 

I used to be pessimistic about the future of our profession but now can see a path and a bright future for those pharmacy operators that take up the challenge and adapt to new ways of working.

 

Don’t wait around to see what happens if and when Amazon arrives. Take a page out of the supermarket play-book and give your patients what they increasingly want convenience, and a user experience akin to what they are already used to in other aspects of their lives.

 

Most, (not all) will stay loyal and why would they not?

 

I’m certainly enjoying working with all the innovative pharmacy owners and other health-tech partners who see the opportunities, as well as the threats and, are choosing to “lean in” to the challenge by harnessing technology to bring pharmacy services into the digital age.

 

I used to be pessimistic about the future of our profession but now can see a path and a bright future for those pharmacy operators that take up the challenge and adapt to new ways of working.

 

On the dispensing side, a lot of operators are already investing in a hub and spoke model to realise efficiencies and for others, there will be options for outsourcing that logistical work like HubRx and Golden Tote from Numark among others I’m sure.

 

Efficient supply is very important as it is the foundation of the relationship with local patients. It is their main reason for interacting with your pharmacy, but I don’t feel it is where the future value for our profession is. That is surely in clinical services to those same patients via the network of what are essentially walk-in clinics in every neighbourhood. Whether that be via NHS commissioned or increasingly private services given the inevitable long-tail effect of the pandemic on NHS service levels.

 

One area I’m particularly excited about is the potential for diagnostics & pathology testing in community pharmacy with the cost of equipment no longer being a barrier with solutions from the likes of Agilis Health.

 

So I’m pretty sure most community pharmacies have a place on the high street of the future but we need to move quickly as a profession to achieve that slick digital patient experience and get the final mile of collection/delivery working well to ensure patients stick with us, Amazon or no Amazon.

 

Kevin Murphy is a superintendent pharmacist and CEO of MedPoint. You can find him on Twitter here.

 

Read more

 

Is Amazon about to move your pharmacy cheese?

 

Amazon, digital dentistry and how community pharmacies fit

 

Professor Harry McQuillan on the ‘ART’ of community pharmacy

 

The ‘ART’ of Scottish community pharmacy is all about data

 

 

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