..Information to Pharmacists
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Your Monthly E-Magazine
DECEMBER, 2003

NEIL JOHNSTON

Management Consultant Perspective

Review 2003 and the Crystal Ball

The past 12 months have been marked by a number of challenges being issued to pharmacy, and 2004 looks as though it will become even more intense.
What is in the crystal ball?

Obviously an increase in the overall number of issues plus an expansion of those covered.
Just revise some of the topics covered below, starting with the Priceline entry into pharmacy, control of consultant pharmacists, U.K deregulation (as a pointer for Australia), Government IT projects, corporatisation as a pharmacy option, the Australian PBS becoming a bargaining tool in the Free Trade Agreement with the US, the first press release of Woolworths interest in pharmacy, RFID and the world future store and the technology changes heralded for retailing, proving your identity and the use of encrypted documents, being tired as a side effect of community pharmacy, and a running commentary as major internal players in pharmacy look to re-arrange the pie as Woolworths, Coles and a range of global entrants line up for their piece of the action.
There will be no rest for an aging pharmacist proprietorship and unless pharmacy looks to rapidly restructure, pharmacy assets will begin to devalue as hostile strategies begin to bite.
Possibly the most serious underlying problem of insufficient qualified pharmacists will begin to trigger some action.
It seems that everyone is just too busy to think past today, and those charged with doing our thinking for us are just not doing it, because to do the right thing will prejudice existing political structures.

Buckle up and hang on for the rollercoaster ride in 2004!

Priceline Pointers
Issue 10, November 2002
In a recent radio interview in South Africa, Peter Green, the financial director of New Clicks, was asked various questions on the Australian Priceline Pharmacy extension.
He confirmed that Priceline was using the Packenham store as a model, and that the plan was to open one additional pharmacy before Christmas this year (Mornington Peninsula).
The basic plan, he said, is to add value to the retail end of pharmacy, which Priceline claims, existing banner groups are unable to do, because of their wholesaler focus.

Consultant Pharmacist Control
Issue 11, February 2003

The recent debate regarding consultant pharmacists, and who should control their destinies, has raised a number of issues.
Philosophically, and derived from my second profession of management consulting, I am opposed to any organisation (business or political) that sets out to control consulting activity, unless it is an organisation specifically set up solely for the purpose of promoting, developing and professionally protecting consultant pharmacists.
Realistically, consultant pharmacists have needed the nurture, guidance and support from the Pharmaceutical Society of Australia (PSA) and the Pharmacy Guild of Australia (PGA), through the Australian Association of Consultant Pharmacists (AACP), to make the proposition viable and sustainable. The perspective of how both those organisations view the development of consultant pharmacy and the ultimate control of its destiny, is extremely important to get right, and the concerns raised by interested pharmacists are valid.
Those concerns should be taken on board by the respective organisations.

The U.K "Bombshell"-Australian Fallout?
Issue 12, March 2003
The middle of January2003 has been electrifying for most small to medium sized UK pharmacists, who now find their livelihood threatened once more.The Office of Fair Trading (OFT) has recommended to the UK Government that the control of entry regulations for UK community pharmacies be abolished.
A similar system existing in Australia is built around NHS approval numbers, but state legislation introduces some safeguards for pharmacists.
The UK Government process is not dissimilar to the New Zealand Government's attempt, almost twelve months ago to the day, to achieve a similar outcome.
The fallout for Australia is that if the UK Government is successful, Australian pharmacists may be in the firing line.
I have previously written on this topic in respect of New Zealand, and I believe it would be in the interest of most thinking Australian and UK pharmacists to revisit these articles.
"Pharmacists Freed from Shopkeeping"
"NZ Ownership Loss (2)"
"NZ Ownership Loss (3)"

"NZ Ownership Reversal"

Government Health IT Projects
Issue 13, April 2003
The following paper was not written by me, but by a person well versed in the medical software industry. The paper was written for colleagues in an attempt to highlight some of the problems the IT Industry had been experiencing in general, and health IT in particular.
It is reproduced with his permission.
The author was well intentioned at the time of writing (about mid 2002) as you will find on reading the material, particularly the last paragraph.
He expected active and informed debate on the issues he raised.
Instead he was villified, called "obstructive" and given his marching orders.
Obviously, there were some vested interests involved.
However, taxpayers and pharmacists have to foot the bill if anything happens to go wrong in such projects as HealthConnect or MediConnect (Project details here).
What is immediately evident is how complicated the entire process is and how there is an attempt to achieve the "final solution" in one hit, rather than a modular progression.
Another writer for i2P, Mark Coleman, expressed similar reservation around August 2002.
This information is published in the interest of open comment, and in the hope that some of our pharmacy leaders will heed the advice so lucidly presented.
The material below being written by an "insider" is laced with acronyms and IT jargon.
The editor has attempted to simplify this, and it should be understood that as the material was written nearly twelve months ago, some changes would have occurred in the interim.

Corporatisation- The Winds of Change?
Issue 14, May 2003
In the March edition of the Australian Journal of Pharmacy, under the title of "Why we oppose corporatisation", appears an article written by John Bronger, the federal president of the Pharmacy Guild of Australia (PGA).
Had it been written in 1950, the sentiments expressed would have been understandable.
But this is the year 2003, in a timeframe when pharmacists feel a little vulnerable and in need of guidance for the trials to come.
Pharmacists are obviously not going to get appropriate guidance, as PGA thinking remains rooted in the 1950's and appears determined not to get ahead of the action.
Pharmacists collectively have again been "shot in the foot".

Australia's PBS Under Attack
Issue 15, June 2003
Our daily news of recent times has been filled with images from Baghdad and shock-horror stories from Pan Pharmaceuticals.
It has diminished two other stories running concurrently- proposed changes relating to the Medicare Agreement and the Free Trade Agreement (FTA) being negotiated with the US.
All the above have some relationship, one to the other, due to their treatment from a global perspective.
I would like to comment on the FTA and the way in which US drug companies can engage with their government, and receive massive support for a power base which already appears excessive, particularly when that base engages with a developing country, or in some instances a developed country such as Australia.
The tactics employed can only be regarded as "bullying".

Woolworths Pharmacy Service
Issue 16, June 2003
On the 8th May, 2003, a press release was launched announcing that since its successful move into petrol marketing, Woolworths is investigating setting up stand-alone pharmacies within its supermarkets, as part of a plan to tap into the $8 billion pharmaceutical market.
The press release gave further details of a trial being undertaken in two of its Sydney stores at Macquarie Centre in North Ryde, and at Kellyville.
The entire range of health and beauty aids is being set up in "pharmacy-like" surrounds within these stores.

RFID and the "The World Future Store"
Issue 17, July 2003
RFID stands for Radio Frequency IDentification, which first appeared in tracking and access applications during the 1980's.
Wireless systems allow for non-contact reading and are effective in manufacturing and other difficult environments, where bar-code labels would not survive.
RFID is well established in areas such as livestock identification and automated vehicle identification systems, because of the ability to track moving objects.
Since the introduction of RDIF, the technology has moved on to track diverse activities such as car components during manufacture (the system survives a high range of temperatures), the tracking of pallets and original cartons in the Supply Chain Process, and more recently, a medical application, where the US military used RFID to tag and track wounded soldiers and airmen during the Iraq war.
It is now being considered as a standard for global retailing.

Your Identity- Can You Prove Who You Are?
Issue 18, August 2003
Recently, some of my neighbors warned me that they have found envelopes in their mailbox torn open, and that they suspected some of their letters had gone missing.
Mindless vandalism, or was it someone trying to steal an identity?
If the experts are correct, identity theft is set to become one of the most popular criminal pastimes into the immediate future.

I Am So Tired
Issue 19, September 2003
I wonder if anyone has stopped to think about the culture of pharmacy?
Changes in culture affect people profoundly and may give a reference point as to how pharmacists are thinking and feeling these days.
I am personally experiencing feelings of profound tiredness, which I do not believe are simply derived from the onset of old age.
In disussions with other pharmacists, I have found they are experiencing the same feelings.
All of these pharmacists could be regarded as highly successful in their chosen profession of pharmacy, but they are all espousing uncertainties in the diverse challenges that are arising from multiple sources.
They are all excellent managers, but never before have they had to adapt to the numerous and rapid changes that have been inflicted by government and its agencies, the industry, and the profession itself.

Woolworths Rx-What it Sees
Issue 20, October 2003
If we were able to objectively stand back and look at the organisation that is Woolworths, we would probably be quite proud of the fact that this home-grown retailer is recognised globally as a best practice retailer, fiercely competitive and forever innovative.
The fact that they represent a sizeable chunk of Australia's GDP gives them economic and political influence that is only matched or bettered, by a handful of other Australian companies.
It's total retailing market share is unparalleled in any other western country.
In a duopoly with its primary rival Coles-Myer, both companies control 80 percent of the Australian retail market, leading some commentators to speculate that this will not be for the ultimate good of consumers.

Woolworths-The State of Play
Issue 21, November 2003
The last week of October has unfolded at a pace that has been difficult to keep up with as press reports began to emerge that Mayne was in serious discussion with Priceline, Woolworths, and others, and that Priceline was also looking to procure a major pharmacy software company.
Unofficial reports indicated that the PGA was near to panic as the various stories unfolded.
Indeed, the articles I prepared last month were vindicated almost totally, as the hostile forces to pharmacy gathered as if following a prepared script from the pages of this e-magazine..

And so endeth the year 2003.
I don't know what your plans are, but I am doing a few adjustments to secure my immediate future, and I will share some of these activities with you over 2004

I have resolved to simplify my business life as much as possible and remove any unnecessary complexity.
As they say, "When the going gets tough, the tough get going".

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Have a peaceful and enjoyable family Christmas, and I will be in touch in February 2004.