ARLINGTON, Va. — Author and consultant Jim Collins is perhaps best known for applying the concept of the flywheel effect to the business world. Introduced in his book Good to Great: Why Some Companies Make the Leap and Others Don’t, the theory eschews the notion that an organization advances by sudden, dramatic surges, asserting instead that steady progress toward strategic objectives leads to increasing momentum and ultimately a breakthrough.

Steve Anderson

The National Association of Chain Drug Stores proves the point. After years of making the case for the centrality of pharmacy in health care; working to ensure fair reimbursement and expand the scope of practice; and facilitating cooperation between business partners, NACDS pushed the flywheel to a tipping point in 2021. Building, in Collins’ words, “upon work done earlier, compounding your investment of effort,” the association is seeing “the huge, heavy disk [fly] forward, with almost unstoppable momentum.”

For its success in advancing the interests of chain pharmacy, and achieving its breakthrough in the midst of the COVID pandemic, during the course of which the industry did as much as any entity to get Americans immunized, the editors of Chain Drug Review have named NACDS Retailer of the Year.

At first glance, Retailer of the Year might seem an odd designation for an association. But NACDS is an organization of retailers, with C-suite executives from member companies comprising the board of directors.

“It is important for retailers and suppliers across the country to understand the engagement of industry leaders inside NACDS — it’s very strong and unique,” says Colleen Lindholz, the association’s current chair and president of Kroger Health. “During the pandemic, engagement was needed for us to come together, really talk and focus on what our true needs were at that very moment. We were able to then go out and make things happen quickly.”

Colleen Lindholz

Community pharmacy’s contributions to the fight against the pandemic are remarkable. As of December 9, the 21 companies participating in the Federal Retail Pharmacy Program had administered more than 187.4 million COVID vaccine doses, including 8 million shots at long-term care facilities.

“I think back to where we started 14 years ago, when we were talking about pharmacies as the face of neighborhood health care, and how far we have come from that point to where we are today, when 70% to 80% of all COVID shots are being administered in a retail pharmacy,” says Steve Anderson, the association’s president and chief executive officer. “Shortly after I came to NACDS, I was on Capitol Hill telling members of Congress about how pharmacy should be the centerpiece of health care in this country. They, frankly, didn’t really think that we were part of the health care system. They thought we were retailers that sold various products, including pharmaceuticals.

“When we started this process, we had the tagline ‘Pharmacies: The Face of Neighborhood Healthcare’ to reposition the industry. It was a simple phrase, but it was pretty powerful. It emphasized that 90% of all Americans live within five miles of a retail pharmacy — which is a quote used by President Biden throughout the last year — and that we are health care providers.”

NACDS and its members responded immediately to the federal government’s call for assistance in dealing with the COVID crisis. Effective working relationships were forged with officials in both the Trump and Biden administrations that produced tangible results.

“When COVID first hit, there was so much uncertainty,” recalls Rick Keyes, president and CEO of Meijer Inc., who was thrust into the role of association chairman a year early, in 2020, when his predecessor took a job in another industry. “As we thought about NACDS, we needed to move pretty quickly because we knew we were on the front lines, whether it was our retail stores or our pharmacies. We could make a difference, but there was a lot to be sorted out.

Rick Keyes

“We moved really quickly to work both at the state level and the federal level through the amazing staff at NACDS and our board to say, ‘How can we help? What are the things that we can do as retail pharmacies to really support our communities? How do we mobilize our pharmacy teams? How do we get on the front lines and really make sure that we can provide access to testing, to take care of and support our communities?’ ”

What began as a partnership built around detecting COVID-19 evolved into one centered on preventing the disease with vaccinations. NACDS’ research into the immunization capacity of retail pharmacy played a big part in the establishment of President Biden’s goal of delivering 100 million vaccine doses within a 100-day period, a target that was met and exceeded with the help of the association’s members.

“From the rollout of testing to the rollout of the vaccinations, the retail industry has truly helped save lives in this country,” Lindholz says, “and I’m so proud of that. It’s a validation of where retail pharmacy sits in the whole ecosystem of health care and the importance that we have in health care overall, when we think about accessibility, convenience, affordability and efficiency, in addition to having some of the most trusted health care professionals in the United States.

“From an NACDS perspective, lessons learned during the pandemic include the role that NACDS plays as the storyteller and the advocate of the industry. During the early stages of the pandemic, the public policies that were needed were not in place to allow retail pharmacies to respond like we did. NACDS really did step up and advocate to allow that to happen and put those policies in place that allowed the country to see the results that we see today.”

The association was instrumental in convincing the Department of Health and Human Services to use its authority under the Public Readiness and Emergency Preparedness Act (PREP Act) to temporarily override state scope-of-practice regulations, thus unleashing the full potential of pharmacy to combat COVID. The leaders of NACDS have made it a priority to convince the government to make those expanded powers permanent.

The drive to secure that status will leverage the association’s recent efforts to raise the profile of chain pharmacy. Beginning in 2020, that work for the first time included national TV spots.

“During the pandemic, especially early on, it was clear that we needed to have a voice, and not just in the industry, but in the country,” Keyes explains. “You think about the pharmacist as one of the most trusted advisors in the health care system. We needed to share that voice.

“NACDS put together some really amazing spots that aired across the country that said, ‘Pharmacy is ready. We’re here to support you — come get tested, come get vaccinated. We’re going to be part of the solution.’ ”

In addition to the progress that pharmacy has made under the PREP Act, NACDS and its allies have won a series of victories in the states. Success at that level is crucial because, during normal times, that’s where pharmacy practice is, by and large, regulated.

“We’re optimistic going into the new year,” says Anderson. “Throughout 2021, we’ve had 70 advancements in the states to make flexibilities permanent for immunization, testing, and pharmacists and technicians’ scope of practice.

“We have achieved advancements to create PBM reform and transparency to include open networks, prohibitions on gag clauses, any willing provider provisions, specialty medications at retail, fairer reimbursement policies and pharmacy audits. And all those we’ve done in 15 states.

“On another front, the U.S. Supreme Court ruled unanimously in the Rutledge decision, which was handed down December 10, 2020, and that has allowed us to do more on PBM transparency and PBM practices. This last year, there were more than 300 PBM bills that have been introduced. The number right now is 53 new laws that have been enacted, which I think is a great victory for our members. So we’re continuing those fights, and we’re going to continue to tell the pharmacy story at the state level, in addition to the national level.”

Keyes points out what’s at stake: “We’ve seen a record number of pharmacies that have closed, and this reimbursement issue is not going away. It’s just getting worse. We’ve seen tremendous traction in the six states where Meijer operates, states like Indiana, where we’re actually able to pass state legislation that calls for transparent reimbursement rates. As we get momentum in the states that builds momentum federally, and we really want to make sure we capitalize on that.”

Another vital contribution that NACDS makes to chain pharmacy is its ability to bring people and companies together. Even with the cancelation of its signature events — the Annual Meeting and Total Store Expo — in 2020 and 2021 due to COVID, the association found meaningful ways to connect with its members, including virtual versions of those events and such innovations as NACDS Live, a series of webcasts that offer insights from industry experts.

“One of our associate members told me early in the pandemic, ‘NACDS is really the glue that’s keeping this industry together,’ and I think that’s true,” Anderson says. “The great strength of NACDS is relationships, and I hear that whenever I meet with a member. Nobody does it better than NACDS at our meetings and conferences. We’re looking forward to getting back to that, because we have a lot to talk about in terms of what we’re going to be doing to move this industry and this association forward.

“Our members are so passionate about what they do for the American people, and that makes it enjoyable and beneficial for all of us to be involved in those events. That communication that we have between our chain retail members and our associate supplier members is invaluable in terms of what it does for our member companies and the consumers that come into their stores each and every day.”

While the commitment of chain pharmacies to serving their customers won’t change, many aspects of what they do and how they go about doing so are evolving rapidly. NACDS intends to stay in sync with those developments.

“We’ve talked about a strategic road map for NACDS and how we’re moving towards more holistic solutions around helping people,” Lindholz notes. “With our members being the front door of health care, there’s just this huge opportunity for us to not only expand our scope, but to understand the consumerism of health care and how we can provide more products and services when people need them most. And, as you start to see retail have not only pharmacies, but clinics, how can we come together in ways like never before?”

NACDS is already providing pertinent information and insights to its members as they begin to develop answers to that question.

“Everything that our members are doing now in positioning themselves in terms of health and wellness destinations is striking,” Anderson says. “In 2023, NACDS will be celebrating our 90th anniversary. Coming out of this pandemic, we will have a new birth in terms of innovation and transformation and technology and, really, leadership, in terms of where the industry’s going and where NACDS should go. We’ve got a lot of work to do coming out of this pandemic, and we’re up to the challenge.”