Dave Wendland,
Vice President
Turning Data Into
Business Intelligence
By Dave Wendland
T
echnology continues to be the driving force within our
industry. Daunting realities such as ever-increasing
prescription usage, a pharmacist shortage, intense com-
petitive pressures, patient compliance concerns, supply
chain challenges such as counterfeit drugs and reimportation, and
the fear of dispensing errors fuels this. From where I sit, retail
pharmacy today is experiencing its own version of the reality show,
Survivor. Tribes (chains and independents) are facing unbelievable
adversity and looking for innovative ways to strike pacts and alli-
ances to remain on the “island.” Perhaps it’s not ready for prime-
time television, but it makes for fascinating commentary.
There are four key areas of technology that I would like to
comment on: 1) informatics and intelligence; 2) point-of-sale; 3) e-
commerce; and 4) supply chain efficiency.
Informatics/Intelligence – There has been a definite surge in
activities related to prescription-level data. Driven by HIPAA and
a perceived value of dispensing data, pharmacies and pharmacy
system vendors are working diligently to address both issues.
Pharmaceutical manufacturers are focusing much attention on the
importance of “persistency” and “compliance” programs. All of
which depend on robust prescription-dispensing data and a direct
link between pharmacist and patient.
With escalating medical costs, efforts that support persistency
of drug regimens and patient care will be met with industry-wide
approval. Although HIPAA regulations limit patient-level activities
outside the pharmacy, enhanced record-keeping methods and com-
munication tools for pharmacists augment their patient care role.
In addition, prescription-pricing intelligence continues to be of
importance to retail operators. Despite a continually declining base
of cash business, knowledge of cash pricing trends within specific
market areas can help optimize overall pharmacy margins.
Point-of-Sale – The propensity for scan data, and the real-
ization that the front end of the drugstore can be more profitable
than the pharmacy, are forcing many operations to re-examine
their inventory-management practices, retail pricing strategies,
assortment planning and in-stock condition. Without reliable
POS data, identifying front-end opportunities is nearly impos-
sible. It is imperative that accurate, up-to-date UPCs, descrip-
tions and related information be managed to populate and
maintain the integrity of their system’s data.
E-Commerce – Continuing its evolution, Web-based pharmacy
operations now fill the landscape. Although a complementary ex-
tension of a brick-and-mortar pharmacy, managing the product data
requires a different set of dedicated resources for the development
and maintenance of consumer-friendly content. Comprehensive
product data to support online operations may include such things
8 HealthCare Distributor  June/July 2004
Hamacher Resource Group
as three-dimensional images, back-of-package content, categoriza-
tion and consistent descriptions.
Supply Chain Efficiency – Technologies such as radio-fre-
quency identification (RFID) and the Electronic Product Code
(EPC) are making headlines today. The challenge for most
involved in the pharmaceutical supply chain is one of cost justi-
fication and timing.
It is our opinion that companies must find ways to turn RFID
data into useful information. This will most certainly pose chal-
lenges for IT departments in the short, medium and long term, as
companies deploy RFID systems. In addition, there is a question
of critical adoption – will the technology be employed broadly
enough to justify the investment.
An item’s EPC is similar to a Social Security number. Because
the EPC will serve as a serial number for each individual item, it is
expected to protect patient safety (virtually eliminating counterfeit
and adulterated drugs); improve inventory management and track-
ing (keeping stock visible throughout the supply chain); and en-
hance retail pharmacy operations (improving dispensing accuracy,
reducing theft and improving merchandising compliance).
Remaining Technology-Driven
To be successful in today’s fast-paced, data-intensive retail
environment, drugstore operators must surround themselves with
proven sources of technology. From robotics to IVR, dispensing
systems to physician connectivity, and supply chain management
to effective space planning, retailers must rely on technology. That
is how our company perceives its future: Built strongly on tech-
nology platforms and business-intelligence-intensive activities.
Today, more than ever, we rely on automation to maintain massive
amounts of data, perform space-management functions, analyze
retail pricing strategies for markets throughout the United States,
populate online pharmacy sites, as well as create industry models
for comparison and report card generation.
Retail pharmacy and its business allies rely on technology to
streamline the flow of information and goods through the supply
chain, and they rely on trained professionals to bring the all-impor-
tant human touch to their respective businesses.
Hamacher Resource Group is an international company that
produces marketing services and retail business intelligence
exclusively for the retail pharmacy industry. Custom programs
address areas such as: product assortment and placement;
retail pricing and promotion; new-item launches; distribution
coverage; and database support. Contact them at 800-888-
0889, www.hamacher.com.