As we move forward into the next era of healthcare, there has been much talk about the various pharmacy and medical models and their relative appeal, while many in the market continue to speculate about which pharmacy model is the likely successor. In the past, some pharmacy related mergers happened merely to produce scale and improve the profit possibilities of those involved with some channel directed strategies and niche providers having success. However, we believe very few of the models today are well positioned to deliver more effective, flexible and transparent solutions that we anticipate the market of the future will need in order to excel in this increasingly complex industry. It is our belief that many of the pharmacy models are not currently aligned with evidence-based medicine, transparency, and delivering improved outcomes for the payers, providers, and consumers.
It is also anticipated that blockbuster branded drugs moving to generic will not only dry up but will be replaced by higher cost generics – and large aggregations will max out supply chain rates. Further, mail order pharmacy will remain only marginally popular with consumers, and without historically significant financial advantages over retail, may actually decline. If this is true, this would produce excess capacity for those pharmacy models built to use mail order as one of its primary profit drivers.
We anticipate that some of the key focus areas in the next era of health care will be: (i) rising Specialty drugs coupled with few generic options, and (ii) increasing revenues through operational excellence incentives in Government programs (Medicare, Medicaid, and Health Exchanges). Successful solution providers coupled with the right model will help health plans deploy holistic solutions that maximize value through improved outcomes (and resultant incentives) along with effective cost management.
DST Pharmacy Solutions and the Future
The DST Pharmacy Solutions Strategy aligns directly with the needs of the future, as pharmacy is no longer an isolated part of healthcare but an important variable in the complex healthcare equation. We focus on the areas of convergence that can bring the best solutions for each client. Specifically, we have proven expertise to manage increasing complexities, we possess the critical claims mass to contract with best in class providers in Specialty, Rebates and Network and have added industry expertise from multiple sources (competitors, consultants, clients, providers). As a result, we can address the convergent opportunities on how to approach complex challenges with our clients:
Unlike competitors with large infrastructure investments (brick/mortar stores and mail facilities), DST Pharmacy Solutions remains nimble and channel neutral, which allows us the freedom to put together the best solution for each of our clients. Finally, the relationship with DST Health Solutions provides convergent opportunities that create solutions between medical claims, analytics insights, and health outcomes solutions of common clients that traditional purely pharmacy focused models do not possess.
It is our belief that the DST Pharmacy Solutions Strategy provides the market not only with a new model, but something better equipped to handle the current and coming demands of the next healthcare era.
We believe our leveraging of core competencies and creation of strategic alliances, in a non-conflicted model, position us ahead of the competition now and going forward. As a result we are poised to deliver not only traditional cost management, but also the Total Value Convergent solutions the market needs for the future.