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Fruth gains flexibility via store-in-a-store format

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Fruth Pharmacy_FoodFair store

Fruth Pharmacy entered a new state with the opening of a location inside a FoodFair store in Grayson, Ky.

POINT PLEASANT, W.Va. — Fruth Pharmacy ventured into a new business model last year by opening three small-format stores.

“This store-within-a- store model features a small Fruth Pharmacy inside of a FoodFair, a regional grocery chain,” comments, Lynne Fruth, chairman and president of the drug chain, which has 29 locations in West Virginia, Ohio and Kentucky.

“We also strengthened our partnership with local hospitals by opening two Express Care Clinics inside our retail pharmacies. The clinics are open seven days a week and are staffed by midlevel providers. The clinics have ramped up quickly and have been well accepted by local customers. Another five clinics will be completed by June 30 in arrangements with three additional hospital ­partners.”

Last year was also one in which Fruth initiated several significant changes in the areas of advertising and retail sales, resulting in a strong improvement in revenue and margins.

Fruth also has an ambitious agenda for this year. “We plan to open at least two additional locations featuring the small-store format in 2016,” explains Lynne Fruth. “We will explore other locations for retail clinics with regional hospital partners. A total of eight clinics should be operational by the end of 2016.

“The completion of the rollout of our central fill location and the opening of our Patient Care Center should help drive increased clinical services in 2016. In addition, Fruth has been selected to partner with the NACDS Foundation to participate in a point-of-care-testing program for hepatitis C and HIV in West Virginia and Ohio.”

fruth lynne_in-store

Lynne Fruth

Consolidation — both throughout the health care industry in general and within community pharmacy in particular — is cause for concern, but within acquisitions and mergers are opportunities, maintains vice president Tim Weber.

“The larger and more vertically integrated companies that include a community pharmacy and payor become, the more concerning it is that companies like Fruth will be locked out of access to employees, Medicare D, etc.,” he says. “Consolidation within the insurance industry is the most concerning, as it further reduces any leverage pharmacies hold in the negotiation process, particularly if they (insurers) are aligned with a pharmacy-owned PBM.”

But Fruth continues to look for ways to provide niche services, “to become true partners” to local employers and providers and not just dispensers of medication.

“Additionally, the continued pressure on pharmacy revenues due to reimbursement changes has forced us to refocus our efforts to grow our nonpharmacy business and revenue, including renting space within our stores to our medical partners,” points out Weber.

Fruth pharmacists, he notes, continue to offer an expanded assortment of programs and services. “Our pharmacists provide a range of on-demand immunizations as permitted by the applicable state laws, provide medication therapy management services to customers identified through partners Outcomes and Mirixia, and complete required counseling and follow-ups on specialty drug dispensing,” he says.

“We are in the process of implementing Medsync services, which will allow our pharmacists and technicians to become further involved in our multi-prescription patients’ lives. Fruth has also begun piloting medbox-style packaging in select locations for some of our patients to allow for better adherence.”

Also in pharmacy, Fruth offers text messaging and smartphone apps for its customers, and it recently began a pilot with Cardinal Health’s Pharmacy Health Network TVs to allow for better communication with customers.

“To help our pharmacy staff, we’ve deployed Kirby Lester tabletop counters in the majority of our stores, Eyecon in two locations and Parata robots in our new central fill facility,” notes Weber. “Once our central fill is fully licensed, we expect to remove up to 2,000 to 3,000 prescriptions a day from our locations to allow our pharmacists more time with patients.

“Fruth continues to explore other technology initiatives to expand services to our customers and to increase Fruth’s ability to deliver a wider range of clinical services.”

Although Fruth has made internal changes to advance pharmacy, that part of the business faces some significant hurdles, notes Lynne Fruth.
“We are still concerned about the issue of access to patients,” she says. “The expansion of managed Medicaid is a concern if we are not included as a provider in all managed plans.

“Some of these managed Medicaid plans are forcing all specialty prescriptions out of state, and we will lobby hard for local pharmacies in the state to be able to fill these Medicaid prescriptions. Increasing compliance and difficulty getting clarity on what is expected from different regulatory agencies is a concern as well as the expanding requirements from DEA and EPA.

“And the finalization of AMP creates uncertainty for retail pharmacies as we await more guidance on the implementation and what the effect will be on Fruth.”


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