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Managing Inventory: The Challenges ––>

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An interview with Supplylogix’s Rick Sage ––>

Supplylogix recently held its second annual customer ideaXchange, which brought over 50 attendees from 25 different companies out to discuss industry issues and provide insight to help better deliver inventory solutions to retail pharmacy. The meeting kicked off with an executive roundtable session. In this interview Supplylogix VP and GM Rick Sage talks with ComputerTalk’s Will Lockwood about some of the key takeaways.

CT: Rick, let’s set the stage by hearing what the overall goal of this conversation was.

Sage: Our primary goal was to spark conversations about what’s going on in the industry today and discuss what the future looks like as well, with the goal of ultimately addressing the issues that will help pharmacy.

CT: OK, so what were some of the topics?

Sage: 340B was a big one. One panelist, Brad Stump from Macro Helix, made a good point. He said, “Trying to manage inventory with 340B services, and the overall inventory flow, is certainly challenging. The traditional auto-ordering method makes it wildly unpredictable, since most of the 340B ordering is done outside of the pharmacy management system. This process creates a challenge to be able to integrate those orders into the overall ordering and predictive models.”

View a slide show of ideaXchange

(click on any thumb nail to enlarge and view the captions)


CT: What about specialty? That’s another area posing a lot of challenges, right?

Sage: Yes, we talked quite a bit about the challenges and opportunities that pharmacies are dealing with when trying to penetrate the specialty pharmacy market, including network exclusions and the inventory investments to get specialty scripts into the pharmacies.

CT: What else was top of mind?

Sage: Another interesting topic was seasonal fluctuations in demand for products. Here pharmacies are trying to figure out how to predict ordering needs in advance of demand and how and when to reduce inventory as the selling season tails off. Panelist Tim Weber from Fruth Pharmacy made a good point here about challenges and needs. He said, “Everything we do is manual right now, from that standpoint. We do a large antibiotic product buy. But the way the cold and flu season has been horrible one year and then nonexistent the next, and then horrible again, it is impossible to predict. We try to react on the fly. If you could look at seasonality over the last few seasons, since Supplylogix has our data, a process to let us know what you estimate demand to be would be tremendously helpful.”


Taking part in the roundtable…

Bobbie Riley (Albertsons)

Brad Dayton (Ahold USA)

Peter Koo (Bartell Drugs)

Tim Bell (BI-LO Holdings)

Jim Cousineau (Brookshire Grocery)

Tim Weber (Fruth Pharmacy)

Mike Bianco (Giant Eagle)

Samer Youssef (Henry Ford Health Systems)

Bill Okuno (Raley’s Supermarkets)

Eddie Garcia (SpartanNash)

Matt Burt (Target)

Curt Maki (Topco Associates)

Andrew Charter (Topco Associates)

Wade Walters (Wegmans Food Markets)

Brad Stump (Macro Helix, LLC)

Chris Dimos (McKesson)

Kevin Kettler (McKesson)

Jody Harvey (Supplylogix)

Rick Sage (Supplylogix). 

CT: And what about the issue of deciding when to reduce inventory?

Sage: Target’s Matt Burt talked about this issue intelligently. He said, “To me, the trickiest part is when you are coming out of the season. How do you get out faster? Right now, our methodology is, in Supplylogix, we say, ‘We think we are roughly at the peak and we are about to start dropping; let’s just manually order everything and then let the pharmacies dictate it from here on out.’ This is tricky because there are probably some of our pharmacies that haven’t even hit the peak yet, but then there are other pharmacies that probably passed their peak three weeks ago. It would be helpful to have a seasonal flag to help monitor these seasonal drugs.”

CT: There’s continued concern about the misuse and diversion of controlled substances. Does this lead to closer scrutiny of stocks of these drugs at pharmacies?

Sage: Absolutely it does. There was a lot of interest among the roundtable panelists in discussing the controlledsubstances challenges related to purchasing anomalies associated with Title 21 of the Controlled Substance Act. These ranged from how to manage tracking excess purchases, to DEA audits, and problems associated with dispensing controlled substances. Bobbie Riley helped us understand what Albertsons is experiencing here. She said, “It’s often an industry issue where companies utilize multiple systems and sources of products. As we further develop the multiple layers of our controlled-substance monitoring programs, we are all solving for X, Y, and Z versus just X. We need teams in place with knowledge of the various systems and where product comes from, and that also understand the rules and regulations to help create internal dashboards.”

CT: This was a wide-ranging discussion. What else did you cover?

Sage: Medication synchronization is a trending topic right now. Our panelists are taking a close look at its impact on inventory. Topco’s Curt Maki gave some perspective on this issue, noting that “There are challenges in transitioning patients and managing when patients are going to come in. I think the ultimate endgame is great.” CT