Bought a pharmacy. Sold a pharmacy. Ask me anything

[imcallingcorp]

Left chain after 6 years of "misery" to own a pharmacy in beautiful NY NY only to learn about independent pharmacy "misery" and sold after 1.5 years. I'm sure there are some questions out there about the indy world. Ask away

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[cozypark]

How many script/day?

How profitable was it (How net income was compared to retail chain income? Similar? Or more/less)

How’s reimbursement from insurance? (I heard it was really getting worse. Some meds you get less that the money you pay to buy. That’s what I’ve heard.

Did you have free delivery service?
If so, how did you manage the extra charge for delivery? From your own pocket?

I am thinking to buy my own pharmacy. (But not in NY though)

 

[gwarm01]

Did you make any money on the sale? If so, was it enough to retire?

 

[Gombrich12]

Were most of the other successful independents engaged in some sort of fraud?

 

[owlegrad]

What are you doing now? What prompted you to sell?

 

[CetiAlphaFive]

Left chain after 6 years of "misery" to own a pharmacy in beautiful NY NY only to learn about independent pharmacy "misery" and sold after 1.5 years. I'm sure there are some questions out there about the indy world. Ask away

1.5 years? ... Did you only take out a loan for the bare minimum to start up?

Do you have any business training or experience outside of these 1.5 years?

 

[sosoo]

prior to quitting, have u ever considered operating a phantom pharmacy?
Phantom pharmacy - A growing health care fraud

 

[imcallingcorp]

How many script/day?

How profitable was it (How net income was compared to retail chain income? Similar? Or more/less)

Took paycut $10/hr, no 401k, no paid time off. I was a 20% owner and agreed to these terms prior to buying. Yes not glamorous package nor large equity in store but it's not cheap to do solo.

How’s reimbursement from insurance? (I heard it was really getting worse. Some meds you get less that the money you pay to buy. That’s what I’ve heard.

Reimbursement is a joke. most rxs you are lucky to get paid cost!!! i've had 2500$ hiv meds where i make $5 profit. Then you have all the DIR fees for medicare who the fu&! knows if you make or lose sometimes lol

Did you have free delivery service?
If so, how did you manage the extra charge for delivery? From your own pocket?

We had free delivery in manhattan and bronx which required a driver and assistant and unfortunately thats a very expensive service to offer. we also had free local delivery which meant needed minimum 2 non pharmacist employees at all times. and yea just comes out of your bottom line as my patient population would never pay delivery fee

I am thinking to buy my own pharmacy. (But not in NY though)

All i can say is do your homework. It's super tough to make any worth while money in the current environment and i dont see it getting better any time soon

 

[imcallingcorp]

Did you make any money on the sale? If so, was it enough to retire?

made my money back plus just enough to make up for all the sacrifices such as less salary etc...

retire lol

 

[alprazolamborghini]

All i can say is do your homework. It's super tough to make any worth while money in the current environment and i dont see it getting better any time soon

whats the point of this thread? funny how you tell people to ask questions and you answer like this

 

[imcallingcorp]

Were most of the other successful independents engaged in some sort of fraud?

Don't know many other indys personally. healthcare fraud is an obviois problem all across healthcare

 

[imcallingcorp]

What are you doing now? What prompted you to sell?

Took some time off for personal reasons. Sold for many reasons. some are ...
1- no money in it and hard to imagine better anytime soon as we have zero control over anything way to regulated / dominated business

2- expected more from partners. all of our faults as this should have been discussed more thoroughly before hand

3- commute was killer about 3 hrs/day

 

[imcallingcorp]

1.5 years? ... Did you only take out a loan for the bare minimum to start up?

Do you have any business training or experience outside of these 1.5 years?

no loans allcash up front i only had 20% stake and the store being sold was a really good deal.

i had zero business know how, but the rest of my partners did including other pharmacies

 

[imcallingcorp]

prior to quitting, have u ever considered operating a phantom pharmacy?
Phantom pharmacy - A growing health care fraud

ever consider running of a cliff? u should

 

[imcallingcorp]

whats the point of this thread? funny how you tell people to ask questions and you answer like this

i answered all his questions specifically they were in the quote for some reason. posted weird

 

[sosoo]

ever consider running of a cliff? u should

if fraud is rampant "across healthcare," might as well do it the right way.

 

[wagrxm2000]

if fraud is rampant "across healthcare," might as well do it the right way.

So you are into fraud too, who would have guessed?

 

[sosoo]

So you are into fraud too, who would have guessed?

i wish but no, as a floater i gain nothing. im just surprised that fraud is rampant in healthcare, but when i expose them ppl attack me. cvs seling expired meds. independents running fraud schemes. im just a messenger bringing it to light. yet ppl acknowledge that fraud is rampant, but they attack me when i expose them. weird'

 

[imcallingcorp]

i wish but no, as a floater i gain nothing. im just surprised that fraud is rampant in healthcare, but when i expose them ppl attack me. cvs seling expired meds. independents running fraud schemes. im just a messenger bringing it to light. yet ppl acknowledge that fraud is rampant, but they attack me when i expose them. weird'

you got dirt on cvs go get some whistleblower money. and what did you expose that you were attacked lol healthcare fraud is constantly exposed and reported by the news. Seen plenty of news on such fraud including doctors, nurses, nursing homes, pharmacists... everyone.

 

[npage148]

Is this some type of fight club thing?

 

[imcallingcorp]

Is this some type of fight club thing?

sosoo has some anger issues it seems. i think its best he seek help

 

[owlegrad]

i wish but no, as a floater i gain nothing. im just surprised that fraud is rampant in healthcare, but when i expose them ppl attack me. cvs seling expired meds. independents running fraud schemes. im just a messenger bringing it to light. yet ppl acknowledge that fraud is rampant, but they attack me when i expose them. weird'

You asking the OP if he considered committing fraud to be "exposing fraud"?

 

[M0df]

It sounds like it was destined to be short term ownership from the start. When you spend 3 hours on commute, even in NY, you must have expected to make plenty of money to compensate for that.

 

[CetiAlphaFive]

It sounds like it was destined to be short term ownership from the start. When you spend 3 hours on commute, even in NY, you must have expected to make plenty of money to compensate for that.

Sounds like there was a lack of leaderships, and too many hands in the pot trying to make their buck.

Not exactly a recipe for success.

 

[lord999]

What changed your mind from ownership (you might have discussed it in your reasons, but the 3 hour commute was something that you were willing to tolerate at first)? Was the (lack of) management and ownership structure the main driver?

As most successful businessmen have had bad businesses in their past, are you going to reattempt ownership someday?

 

[sosoo]

You asking the OP if he considered committing fraud to be "exposing fraud"?

exposing is a bad word choice. i meant bringing to light. and the link was provided. these frauds are wild and serious but hardly anyone mention them. i never done independents but phantom pharmacy was huge n wildly successful at one point in time. i was curious what independents have thoughts about them.

 

[imcallingcorp]

It sounds like it was destined to be short term ownership from the start. When you spend 3 hours on commute, even in NY, you must have expected to make plenty of money to compensate for that.

living in NYC I have always had long commutes. college averaged 3-4 hrs / day and job prior was 1.5hrs / day. commute alone was never going to be a deal breaker.

 

[imcallingcorp]

Sounds like there was a lack of leaderships, and too many hands in the pot trying to make their buck.

Not exactly a recipe for success.

100%. I went into this wanting their partnership because they were all veterans of the business. But to them this was a cheap lets see what our extra money can do for us deal. For me it was 75% of my liquid money. Biggest take away you don't need people as partners for money use a bank and you don't need them as partners for their experience you can always hire people to consult etc...

 

[M0df]

Ok so return was not what you expected. Can you be more specific? Was it at least 2-3x of what you were making working base hours for a chain?

I always wanted to do this type of thing but with 1 partner, maybe 2 at most in the right setup.

 

[imcallingcorp]

What changed your mind from ownership (you might have discussed it in your reasons, but the 3 hour commute was something that you were willing to tolerate at first)? Was the (lack of) management and ownership structure the main driver?

As most successful businessmen have had bad businesses in their past, are you going to reattempt ownership someday?

1 word reimbursement. I was so eager to get out of corporate that I didn't do my homework. And even from when we took over until sold got even worse. The PBMs are killing the indy segment so bad. I just couldn't stomach it , kept worrying about going out of business or putting money in monthly and so we put the store on the market and got an offer that I consider very fair so good bye. If reimbursement alone was better I could have delt with any of the other issues but when you are running a business it all comes down to the $

i would certainly be willing to be a business owner again but definately not pharmacy ( unless ofcourse all pbms apologize for their behavior and start paying us like professionals)

 

[imcallingcorp]

exposing is a bad word choice. i meant bringing to light. and the link was provided. these frauds are wild and serious but hardly anyone mention them. i never done independents but phantom pharmacy was huge n wildly successful at one point in time. i was curious what independents have thoughts about them.

 

[imcallingcorp]

exposing is a bad word choice. i meant bringing to light. and the link was provided. these frauds are wild and serious but hardly anyone mention them. i never done independents but phantom pharmacy was huge n wildly successful at one point in time. i was curious what independents have thoughts about them.

I have thoughts. what the .... does this have to do with my topic. My thoughts about them . they are losers , scum . so are the rest that bleed the system with their greed. Did you really have to ask? go troll elsewhere

 

[lord999]

1 word reimbursement. I was so eager to get out of corporate that I didn't do my homework. And even from when we took over until sold got even worse. The PBMs are killing the indy segment so bad. I just couldn't stomach it , kept worrying about going out of business or putting money in monthly and so we put the store on the market and got an offer that I consider very fair so good bye. If reimbursement alone was better I could have delt with any of the other issues but when you are running a business it all comes down to the $

i would certainly be willing to be a business owner again but definately not pharmacy ( unless ofcourse all pbms apologize for their behavior and start paying us like professionals)

Thanks for your candor. I doubt that will change. McKesson and ABC tend to make a business out of cheating honest people when they can. "All for the shareholders", they say, when they pay the trivial fines for anticompetitive behavior.

 

[imcallingcorp]

Ok so return was not what you expected. Can you be more specific? Was it at least 2-3x of what you were making working base hours for a chain?

I always wanted to do this type of thing but with 1 partner, maybe 2 at most in the right setup.

Specifically I touched on already. My salary was 15% less than at chain plus no benefits. Obviously as a 20% owner I would receive a cut of profits however thats only if there are profits and only if you don't have to reinvest into business. The store we bought was 2.5 years at the time still a baby. In a place like NYC where there is tons competition unless you have some hookups with clinics or large offices etc... growing script count based on just being a great pharmacy is a slowwwww process.

If you ever try I recommend buying an existing pharmacy over starting from scratch. Start up in the current business environment is best for trully underserved areas where your script count is kind off guaranteed. Although with mail order and preferred networks for medicare sometimes your patients can't come to you anyway.

 

[GrapePropel]

Took some time off for personal reasons. Sold for many reasons. some are ...
1- no money in it and hard to imagine better anytime soon as we have zero control over anything way to regulated / dominated business

2- expected more from partners. all of our faults as this should have been discussed more thoroughly before hand

3- commute was killer about 3 hrs/day

I live in Manhattan and plan on opening a pharmacy up here. How was your commute three hours? even from NJ and Ct it's only an hour to NYC

 

[imcallingcorp]

Thanks for your candor. I doubt that will change. McKesson and ABC tend to make a business out of cheating honest people when they can. "All for the shareholders", they say, when they pay the trivial fines for anticompetitive behavior.

Right the PBMs busy makin killing and although the Mckesson's of the world need the indys for the higher margins they make of them they have their own interests. But what will it take to have us payed decently for our work? Here's another fun topic . So I don't know what most here know about preferred medicare plans but in essence if you as a store take a preferred contract ( some indys aren't allowed into some ) your pharmacy will be payed less than a non preferred pharmacy. In return they "promise" you access to lives because those lives will have to pay much higher copays to use non preferred pharmacys. Point is even places like rite aid and cvs were not preferred in most partD plans other than the ones they own. And how much difference is this reduced pay I have example. I was preferred aetna D provider in 2016 and you would lose money on every single generic you filled no matter what! Sometimes big losses!
example * $100 loss if I filled 60g clobetasol

 

[imcallingcorp]

I live in Manhattan and plan on opening a pharmacy up here. How was your commute three hours? even from NJ and Ct it's only an hour to NYC

Don't want to say exactly where I live but yes 3 hrs/ day and I had no shorter option.

 

[GrapePropel]

Specifically I touched on already. My salary was 15% less than at chain plus no benefits. Obviously as a 20% owner I would receive a cut of profits however thats only if there are profits and only if you don't have to reinvest into business. The store we bought was 2.5 years at the time still a baby. In a place like NYC where there is tons competition unless you have some hookups with clinics or large offices etc... growing script count based on just being a great pharmacy is a slowwwww process.

If you ever try I recommend buying an existing pharmacy over starting from scratch. Start up in the current business environment is best for trully underserved areas where your script count is kind off guaranteed. Although with mail order and preferred networks for medicare sometimes your patients can't come to you anyway.

What's with virtually every independent pharmacy in manhattan being a soap/candle/makeup/perform? The minimum size for a pharmacy in New York state is 300 sq ft. I plan on opening one up that is 350 sq ft that mainly focuses on making money from scripts, cigarette sales and New York State lottery machines. You have to understand that sometimes it can take 3-5 years before your pharmacy can become profitable. Going in at only 20% equity I assume you hand investors that were not involved in the day-to-day performance of the store? What are some undersevred areas in Manhattan? East harlem? Lower east side (alphabet city)

 

[GrapePropel]

Right the PBMs busy makin killing and although the Mckesson's of the world need the indys for the higher margins they make of them they have their own interests. But what will it take to have us payed decently for our work? Here's another fun topic . So I don't know what most here know about preferred medicare plans but in essence if you as a store take a preferred contract ( some indys aren't allowed into some ) your pharmacy will be payed less than a non preferred pharmacy. In return they "promise" you access to lives because those lives will have to pay much higher copays to use non preferred pharmacys. Point is even places like rite aid and cvs were not preferred in most partD plans other than the ones they own. And how much difference is this reduced pay I have example. I was preferred aetna D provider in 2016 and you would lose money on every single generic you filled no matter what! Sometimes big losses!
example * $100 loss if I filled 60g clobetasol

if you are going to lose a lot of money on a script you tell the patient you are out of stock or can't process it because you will lose money. Even if this violates your contract because you need to do it to survive .

 

[imcallingcorp]

What's with virtually every independent pharmacy in manhattan being a soap/candle/makeup/perform? The minimum size for a pharmacy in New York state is 300 sq ft. I plan on opening one up that is 350 sq ft that mainly focuses on making money from scripts, cigarette sales and New York State lottery machines. You have to understand that sometimes it can take 3-5 years before your pharmacy can become profitable. Going in at only 20% equity I assume you hand investors that were not involved in the day-to-day performance of the store? What are some undersevred areas in Manhattan? East harlem? Lower east side (alphabet city)

So pharmacies will soon be banned from selling cigarettes and lotto nets you very little profit. pharmacies that sell high margin items are smart. If you want to be in a lower income neighborhood your best bet is having a very large store so that your front end helps. Like a pharmacy / 99c store type . You have to think what your demographic wants. I highly recommend you stay away from having a whole in the wall store they may have worked in the past but not anymore

 

[GrapePropel]

If you think

Where was your pharmacy at in NYC?

 

[imcallingcorp]

if you are going to lose a lot of money on a script you tell the patient you are out of stock or can't process it because you will lose money. Even if this violates your contract because you need to do it to survive .

Obviously I never filled those type rxs. my point was that this is the current environment in the business. we should never have to be put in thise situations to begin with

 

[imcallingcorp]

Where was your pharmacy at in NYC?

won't say exactly but it was manhattan uptown

 

[GrapePropel]

won't say exactly but it was manhattan uptown

So Harlemish.

How much did you guys spend to buy the pharmacy? I'm assuming it was between 800,000 and 1.5 million USD. Weren't you suspicious why the previous owners were selling? (they were prob losing a ton of money) Why did you think you could turn around the operation?

How many scripts were you doing a day.

What was your break even?

What marketing did you do? was it effective?

What were your most profitable customers and least?
I'm assuming uneducated cash patients were the most profitable because you can charge them a lot without them knowing the market rate for the meds

Any profitable medicare patients? (HIV, HEP C, obesity) ect?

 

[CetiAlphaFive]

won't say exactly but it was manhattan uptown

Hahaha, bro, you literally can't throw a pizza wrapper without hitting an independent anywhere in the 5 boroughs.

I appreciate your OPSEC tho

 

[imcallingcorp]

So Harlemish.

How much did you guys spend to buy the pharmacy? I'm assuming it was between 800,000 and 1.5 million USD. Weren't you suspicious why the previous owners were selling? (they were prob losing a ton of money) Why did you think you could turn around the operation?

How many scripts were you doing a day.

What was your break even?

What marketing did you do? was it effective?

What were your most profitable customers and least?
I'm assuming uneducated cash patients were the most profitable because you can charge them a lot without them knowing the market rate for the meds

Any profitable medicare patients? (HIV, HEP C, obesity) ect?

Bought pharmacy for under 300k inventory included. Was doing about 90 rx per day and we knew the problems the pharmacy had. However it was a good deal if you consider the cost of opening up from scratch. The store was big so large expenses such as tons of shelving , 2 pos systems, etc...

Not sure what you mean by break even

We did sale flyers such as any big retailer since we had large front end. It definately brought in many customers but not rxs. People who have existing pharmacies they use won't just switch without good reason.

Cash customers are very rare thanks to obamacare unfortunately. Especially in low income areas all have some form of medicaid. Medicare paid better thank medicaid but with DIR fees who knows.

You ask about profitable patients i mean the more they take the better chance you have. Profitable meds are like the lotto. generic abilify was my favorite had plenty people on that and low cost med to keep in stock , much better than expensive brand meds that get you small percent while locking up tons money on your shelf.

 

[GrapePropel]

Bought pharmacy for under 300k inventory included. Was doing about 90 rx per day and we knew the problems the pharmacy had. However it was a good deal if you consider the cost of opening up from scratch. The store was big so large expenses such as tons of shelving , 2 pos systems, etc...

Not sure what you mean by break even

We did sale flyers such as any big retailer since we had large front end. It definately brought in many customers but not rxs. People who have existing pharmacies they use won't just switch without good reason.

Cash customers are very rare thanks to obamacare unfortunately. Especially in low income areas all have some form of medicaid. Medicare paid better thank medicaid but with DIR fees who knows.

You ask about profitable patients i mean the more they take the better chance you have. Profitable meds are like the lotto. generic abilify was my favorite had plenty people on that and low cost med to keep in stock , much better than expensive brand meds that get you small percent while locking up tons money on your shelf.

By break even I mean how many scripts a day did you calculate/estimate you would be needing to sell a day to cover the cost of rent + electricity/utilities + salaries of employees + insurance + any other daily operating cost. For example maybe it was 140 scripts a day, maybe 200 scripts maybe 300 prescriptions... like on average maybe you make 10 USD per a script profit.

Can you give some of the pros and cons of the work place vs working for chains?

I assume it was you and one other pharmacist that took turns at the store. Were you able to sell it or did you have to eat the whole loss of ~200k?

What advice do you have to me who will be opening up my own pharmacy from scratch in manhattan?

I heard locations near hospitals/quick clinics are good.

 

[CetiAlphaFive]

Bought pharmacy for under 300k inventory included. Was doing about 90 rx per day and we knew the problems the pharmacy had. However it was a good deal if you consider the cost of opening up from scratch. The store was big so large expenses such as tons of shelving , 2 pos systems, etc...

Not sure what you mean by break even

We did sale flyers such as any big retailer since we had large front end. It definately brought in many customers but not rxs. People who have existing pharmacies they use won't just switch without good reason.

Cash customers are very rare thanks to obamacare unfortunately. Especially in low income areas all have some form of medicaid. Medicare paid better thank medicaid but with DIR fees who knows.

You ask about profitable patients i mean the more they take the better chance you have. Profitable meds are like the lotto. generic abilify was my favorite had plenty people on that and low cost med to keep in stock , much better than expensive brand meds that get you small percent while locking up tons money on your shelf.

.... Unless you had like 2 pharmacists and 3 techs I don't understand how you guys weren't pulling a nice monthly profit.

Were each of the "owners" pulling a monthly check?

It's starting to sound like you're either not telling the truth or got taken for a ride

 

[imcallingcorp]

By break even I mean how many scripts a day did you calculate/estimate you would be needing to sell a day to cover the cost of rent + electricity/utilities + salaries of employees + insurance + any other daily operating cost. For example maybe it was 140 scripts a day, maybe 200 scripts maybe 300 prescriptions... like on average maybe you make 10 USD per a script profit.

Can you give some of the pros and cons of the work place vs working for chains?

I assume it was you and one other pharmacist that took turns at the store. Were you able to sell it or did you have to eat the whole loss of ~200k?

What advice do you have to me who will be opening up my own pharmacy from scratch in manhattan?

I heard locations near hospitals/quick clinics are good.

We calculated that the place was a break even pharmacy if run properly when we bought it. That turned out to be true. Although now after what I saw I would never calculate anything based on just script count. Not all rxs are created equal. Id rather fill 20 rx that average 100 per rx profit than 200 rx that are worthless.

Pros are you're the boss. Cons are your the boss lol. What I mean by that is first of all most people are not born leaders and to be a good boss you must be a good leader. So for most there would be a huge learning curve to go from say a staff pharmacist to owner. I had a hard time myself and it took me about 9 months to really become effective. The more employees your store has the more vital it is you excel as a boss. People unfortunately take advantage of niceness. Pro of chain is money is no worry, patient didn't pick up expensive med who cares, someone put refrigerated item on shelf who cares, etc... Con of indy is the obvious any and all mistakes come out of your bank. And it hurts.
Many other pros and cons it would be an essay

Yes locations near such are good, but now with NY mandating ERX you can't rely on anyone walking by and saying lets try this pharmacy. So unless you get a hook up in the hospital or clinic just being close will not do you any good. Plus assume many places already have an existing pharmacy relationship.

 

[imcallingcorp]

.... Unless you had like 2 pharmacists and 3 techs I don't understand how you guys weren't pulling a nice monthly profit.

Were each of the "owners" pulling a monthly check?

It's starting to sound like you're either not telling the truth or got taken for a ride

Def no one took me for anything. I was in day to day control of all the money in the bank and payed all the bills and payroll myself.
As I said we had a large store in NY so that was around 10K month. Add pharmacist salaries, add 1 tech, add front end employees, add delivery driver and helper, add utilities, add insurance etc... trust me its the truth.

Now if you have a store with say a rent under 3k a month and no deliveries and small front end so only need 1 register for whole store then all of a sudden numbers add differently. But as they say location location location, you usually get what you pay for. The most money to be made as a pharmacy today is having a walgreens , cvs ,99c store type front end that crap is guaranteed money and guaranteed margin in the right neighborhood. How many hydrocortisones and canes you gonna sell daily, not enough is the answer, most small pharmacies have dusty non moving front ends.