DSN_0424

INDUSTRY IN TRANSITION

LESS COMPLEXITY

KNAPP is on a mission to transform pharmacy by automating virtually every aspect of prescription filling and pickup.

Automated putaway, DSCSA scanning, stock bottle management, and Will Call order packing enable low-touch, high-throughput dispensing — with no additional staff. Automatic indoor kiosks and 24/7 outdoor terminals facilitate low-touch “Fast Lane” pick up.

MORE TIME

1 Pharmacies can reduce operating costs while increasing revenue streams and freeing space for new services

2 Pharmacists and technicians can spend more time with patients and improve care outcomes

3 Patients can conveniently pick up prescriptions when, where and how they want

Making complexity simple

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We are connecting the digital ecosystem and empowering the pharmacist patient relationship. Scan or visit outcomes.com to see how our solutions optimize pharmacy productivity and profitability creating better outcomes for all.

Industry, Check

What will retail pharmacy be when it grows up?

“WITH U.S. HEALTHCARE COSTS SURGING AND THE DEARTH OF PHARMACISTS CONTINUING, AN EVOLUTION IN CONVENIENT, AFFORDABLE HEALTHCARE SERVICES IS THE NEED OF THE HOUR IN THE U.S.”

-ADITYA KAUSHIK, CORESIGHT RESEARCH

As retail pharmacy executives prepare to gather in Palm Beach, Fla., for the National Association of Chain Drug Stores Annual Meeting, the industry is in a pivotal moment. As one analyst told our reporter, in some ways, it is deciding what it wants to be when it grows up.

Pharmacies large and small are rethinking how they do business, and there is a lot to think about—from the products they offer to the design and locations of their brick-and-mortar stores, competition from e-commerce giants, PBM reform, a reimbursement payment framework and much more.

In this month’s cover story (page 42), our reporter interviewed analysts, pharmacy executives, industry observers and others to get a clear picture of where the industry stands at the moment and where it’s headed. The outlook might be positive.

“With U.S. healthcare costs surging and the dearth of pharmacists continuing, an evolution in convenient, affordable healthcare services is the need of the hour in the U.S.,” Aditya Kaushik, analyst at Coresight Research, said in a recent Market Navigator report on the retail drug store industry. As drugstores increasingly expand the services they offer, they have an opportunity to become “the next generation of primary care providers, treating patients with acute illnesses and chronic conditions, such as asthma, diabetes, and hypertension.”

Our second feature (page 54) takes a look at something that all shoppers in the United States have to face at some point—self checkout kiosks. Billed as a revolution in retail, self checkout is as American as apple pie but not as enjoyable.

We wanted to see what consumers really think of self checkout, so we reached out to TruRating, a customer experience and insights company that recently conducted a study of perceptions about selfcheckout. Based on verified customer feedback, the study gives an accurate snapshot of why shoppers use self checkout and when.

“There has been a move in more and more retailers to implement self-checkout options to try to increase throughput at the point of payment and also to reduce labor costs and shortages,” said Gareth Johns, chief data officer at TruRating. “The preferences and experiences of customers hasn’t been the main driver for this move and there has been little research into how customers feel about this major shift in their shopping experience.” Hopefully, this study changes that. dsn

Dollar General makes personal care donations to address period poverty

Because a reported 16.9 million women in the United States are living in poverty, two-thirds of which could not afford personal care products in the past year, seven Dollar General distribution centers and their employees across the nation donated more than 36,000 feminine hygiene products in 2023. They are donating in their local communities again this year.

After talking with her younger sister last fall, Elizabeth T., an inbound-outbound manager at DG’s Scottsville DC, discovered that the local high school was not always able to provide resources for feminine hygiene. Working with the DG Diversity and Inclusion team, the Scottsville DC launched a voluntary initiative surrounding the cause, collecting sanitary napkins and tampon donations for Allen County-Scottsville High School. In March 2023, the Scottsville DC donated more than 3,500 pads, 1,000 tampons and 330 panty liners for students. “I felt like it was an important thing to have for our younger generation of females in the community,” said Elizabeth.

In addition, the Scottsville DC recently donated personal care products to the International Center of Kentucky, helping to provide hygiene essentials to incoming refugees.

In Northern Kentucky, Dollar General’s Walton DC collaborated with employees for a feminine hygiene product drive. The collective donations benefited Sunrise Children’s Services, a nonprofit providing therapeutic foster care and community-based services statewide.

“Often, our children arrive with little notice and few possessions, sometimes only the clothes they are wearing,” said Jake Pelfrey, vice president of advancement at Sunrise Children’s Services. “Dollar General’s support in caring specifically for the young ladies in our program is invaluable. It enables us to offer healing and hope, showing these girls that they are surrounded by a community that loves, cares and roots for them.”

DG’s Alachua DC selected the nonprofit organization Blossoming Butterfly as the recipient of its feminine hygiene product drive—collecting and donating an estimated $3,700 worth of assorted items. Blossoming Butterfly provides encouragement, education and support for individuals battling cancer. The organization’s focus is on preparing for the battle, providing financial assistance and maintaining a pantry of needed items that align with the organization’s values and goals for community impact.

At Ardmore High School and Madill Middle School in Oklahoma, school officials noticed several girls were absent once a month because their families could not afford menstrual products.

Joi B., director of diversity and inclusion at DG, worked with the Ardmore DC to establish a feminine product collection drive for the 2023-2024 school year.

In addition to supporting each distribution center’s personal care product drive, Joi B. has made it a personal

mission to support the hygiene needs in her local community of Indianola. She independently established “Keep It Cute” shelves at local schools, which serve as repositories of feminine hygiene and other basic clothing products where students can privately access what they need at no cost.

Dollar General has supported Joi’s efforts through product donations, the DG Kindness employee recognition program including a $1,000 donation and the annual Women’s History Month drives—and Joi’s efforts were recently

spotlighted through partner content with Reader’s Digest.

In addition to the collective efforts of the DCs and their employees, DG has implemented feminine care produce drives at the company’s distribution centers and the Store Support Center throughout the month to continue to support women and raise awareness of period poverty.

Kroger to sell specialty pharmacy business

Kroger has entered into a definitive agreement to sell its specialty pharmacy business to CarelonRx, a subsidiary of Elevance Health.

“Kroger Specialty Pharmacy has been part of our company since 2012, and we want to thank our management team and associates for their enduring commitment to their patients,” said Colleen Lindholz, president of Kroger Health. “As part of our regular review of assets, it became clear that our strong specialty pharmacy business unit will better meet its full potential outside of our business. One of the most important considerations was continued operations to ensure minimal disruption to our associates and patients. We are confident this transaction will help the business to grow and deliver better results for patients. We look forward to working toward a smooth transition for associates and patients.”

The retailer’s specialty pharmacy serves patients with chronic illness and require complex care. Skilled clinicians and therapy programs allow patients and prescribers to benefit from education and resources, counseling, side effect management, financial assistance, personalized care and administrative expertise. The specialty pharmacy business supports patients facing diseases including rheumatoid arthritis, growth hormone deficiencies, multiple sclerosis and bleeding disorders.

Kroger Specialty Pharmacy is separate from other Kroger Family of Pharmacies, so in-store retail pharmacies and The Little Clinics are not included in this transaction.

This transaction is subject to customary closing conditions, including regulatory approvals and is expected to close in the second half of 2024; it is not expected to have an impact on Kroger’s 2024 guidance.

Target enhances checkout experience

Target is making several enhancements to its checkout experience.

The retailer said checking out is one of the most important moments of the Target run, so a fast, easy experience is critical to getting guests on their way quickly. During the pandemic, many guests preferred using self-checkout for all their purchases because it offered them a contactless option, the retailer said.

“Today, ease and convenience are top of mind, so, to learn more about guests’ self-checkout preferences, we piloted the concept of Express Self-Checkout with limits of 10 items or fewer at about 200 stores last fall,” Target said. “The result: self-checkout was twice as fast at our pilot stores. By having the option to pick self-checkout for a

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quick trip, or a traditional, staffed lane when their cart is full, guests who were surveyed told us the overall checkout experience was better, too.”

Target said the following updates—which went live on March 17—will make its checkout experience more enjoyable:

♦ Express Self-Checkout with limits of 10 items or fewer at nearly 2,000 stores nationwide;

♦ Opening more traditional lanes staffed by team members across for guests who have more in their Target carts, need a helping hand or just enjoy connecting with team members;

♦ Store leaders have the flexibility to open more lanes staffed by team members and set self-checkout hours that are right for their store.

♦ While the hours of operation may vary based on store needs, Express Self-Checkout will be available during the busiest shopping times;

♦ Investing in additional training to ensure that teams can continue to provide great guest service during the checkout;

Walmart offering on-demand early morning delivery

Walmart is debuting Express On-Demand Early Morning Delivery, offering the convenience of delivery starting at 6 a.m.

“This expanded timing offers them peace of mind knowing they can get things they need at their doorstep to kickstart the day,” the retailer said.

With hundreds of thousands of items available in-store and hundreds of millions more online, customers can easily get what they need during the early morning hours from fashion to furniture and beyond in as soon as 30 minutes, Walmart noted.

“Our commitment to convenience extends beyond just the early hours. It’s about making shopping seamless for the customer,” the company said. “With features like LateNight Express Delivery, Live Shopper for real-time communication with Shoppers and On-Demand Delivery for sameday convenience, Walmart prioritizes putting the power in the customers’ hands. It’s a superpower that’s simple—all customers need to do is open the Walmart app or Walmart. com and begin selecting their items. And for Walmart+ members, standard delivery is always free.”

“As we continue to innovate and accelerate, the message is clear: Shopping should be personal and as tailored to fit your lifestyle as those freshly-delivered work shirts. With Walmart’s On-Demand Early Morning Delivery and a suite of other convenient options, we’re making sure you have what you need, when you need it so you can reclaim your time no matter what the clock says,” the company added.

♦ Continue evolving to match guests with the right checkout options—alongside same-day fulfillment services like Drive Up, Order Pick Up and Target’s same-day delivery.

BJ’s Wholesale Club plans Southeast, Midwest expansions

BJ’s Wholesale Club continues to expand its footprint into markets beyond the East Coast.

The Massachusetts-based membership warehouse club, which previously announced plans to open 12 news clubs and 15 gas stations this fiscal year, has revealed the newest locations coming to its footprint. The locations, in the Southeast and Midwest, include two new major markets.

BJ’s did not disclose the opening dates of the five locations, which are listed below.

♦ Maryville, Tenn. (BJ’s fourth location in the state and first in the Knoxville market);

♦ Myrtle Beach, S.C. (BJ’s second club in the state and first in Myrtle Beach);

♦ Palm Coast and West Palm Beach, Fla. (BJ’s 38th and 39th clubs in the state); and

♦ Carmel, Ind. (BJ’s second location in the state).

♦ Earlier this month, BJ’s announced plans to enter its 21st state—Kentucky—with the opening of a club near the Jefferson Mall in Louisville, in early 2025.

“BJ’s combination of unbeatable value and convenience continues to resonate with members, and we’re pleased with the performance of our new clubs,” said Bill Werner, executive VP, strategy and development, BJ’s Wholesale Club. “Our real estate pipeline is the strongest it’s been in 20 years, and we look forward to helping even more families save up to 25% off grocery store prices as we add clubs to both new and existing markets.”

Each new BJ’s location is expected to create approximately 150 jobs for its respective community. Clubs feature an assortment of fresh foods, produce, full-service deli offerings, bakery goods, grocery staples and household essentials, in addition to home décor items, toys, tech products and pet supplies.

For the 14-week period ended Feb. 3, BJ’s revenue rose 8.7% to $5.357 billion, compared with $4.93 billion for the 13-week period in the year-ago quarter. Membership fee income increased by 6.5% year-over-year to $108.4 million. Total comparable club sales decreased by 0.4%.

“We ended fiscal 2023 on a strong note,” said BJ’s chairman and CEO Bob Eddy in the most recent earnings release. “Our membership grew in robust fashion and we continue to retain members at all-time high rates. We delivered impressive market share gains in our clubs and at our gas pumps, driven by acceleration in traffic and growth in units sold.”

This story originally appeared on Chain Store Age.

CVS touts prescription delivery offerings

CVS Pharmacy is reminding customers that it offers several delivery options for patients with eligible prescriptions, including one- to two-day delivery and on-demand delivery (within three hours), at more than 9,000 pharmacy locations nationwide.

Additionally, CVS offers free one- to two-day delivery and on-demand (same-day) delivery on eligible prescriptions through its ExtraCare+ membership program. All options can be easily managed through the CVS Pharmacy app, SMS text messaging, CVS.com or by speaking with the local CVS Pharmacy team.

CVS Pharmacy began offering one- to two-day prescription delivery nationwide in 2018 and launched on-demand prescription delivery nationwide in April 2019.

Walmart’s beauty sector glows up

Spring has sprung and Walmart is building up its beauty assortment, following the recent expansion of its virtual try-on feature.

To kick things off, the company said that its brand accelerator program—Walmart Start—would be making a return, with a class that includes a diverse group of hair, skin and body care brands from women and diverse-owned founders.

♦ The newest Walmart Start class includes:

♦ Current State: Co-founded by Emily Parr and Majeed Hemmat, the brand creates nutritiously balanced and clinically responsive products to help care for the skin;

♦ LatinUS: Created for Latinas, its mission is to help all women feel empowered, confident and beautiful. Lu products are powered by a proprietary technology that aims to give consumers healthier strands after use;

♦ Kazmaleje: A hair care tool and accessory brand that was founded by sisters LaToya, LaTasha and LaTrice Stirrup and includes KurlsPlus Detanglers; and

♦ Sundae Body: Founded by Lizzie Waley, the brand creates body care products that aim to transform shower routines.

Walmart’s beauty savings event would be returning through April 28, and will include such brands as Olive & June, Bubble, Evo & Avo, Schwarzkopf and Cantu, among others.

Lastly, the company shared a few trends currently on the rise, which include skincare’s influence on the beauty sector, bold cosmetics colors for the spring and the continuing popularity of skin care.

Target reportedly doubling salaried employees’ bonuses

Target is reportedly doubling bonuses for salaried employees, per a Bloomberg report, which cited people familiar with the matter.

The report noted that Target will pay 100% of employees’ eligible 2023 bonuses, up from 50% the year prior.

The hike in bonuses follows three consecutive quarters of sales declines.

Target’s profits increased higher than it was expecting last year, providing $2 billion in operating income from which to give out bonuses. Bonuses at Target typically max out at 175% of eligible amounts, per the report.

The increased payouts don’t apply to hourly employees, and senior executives have a separate bonus structure, according to the report. Cash bonuses will be payable at the end of March.

Target did not disclose its potential bonus ranges or how many of its roughly 415,000 employees are eligible, the report noted. Most Target workers are hourly store and

distribution-center employees. “The bonus structure is informed by goals set at the beginning of the fiscal year and includes sales performance and profit outcomes,” Target spokesman Brian Harper-Tibaldo said, per the report.

The report also noted that in recent weeks, Target’s shares rose 12% after the company disclosed better-than-expected earnings attributable to lower inventory levels and supply-chain costs. The retailer also announced plans to launch a paid membership program as well as plans to open and renovate hundreds of stores. Additionally, store and digital traffic are improving, though still in the red. Target now expects comparable sales to return to growth in the second quarter, per the report.

Ulta Beauty, Pact partner on sustainability efforts

Ulta Beauty is teaming up with packaging waste solution provider Pact to divert beauty product empties from landfills.

The beauty retailer is providing collection bins from Pact’s The Beauty Dropoff recycling program at all of its more than 1,350 U.S. stores. Customers can discard clean, empty, unbagged small cosmetics containers in the bins for recycling. Eligible items include plastic bottles and jars smaller than a fist, as well as pumps and dispensers, droppers and applicators, and pouches.

Empties for recycling via The Beauty Dropoff can be any brand, not just brands available at Ulta Beauty. Pact will then upcycle packaging material into another product or downcycle it into a lower-value item by breaking down packaging material to its most basic molecular component so it can be used as raw material in future products.

Packaging that cannot be used in any other way is incinerated to generate electricity or fuel. Ulta will promote its participation in The Beauty Dropoff program by social media, email and in-store displays.

Pact is a non-profit beauty collective founded by cosmetic brand MOB Beauty and clean beauty retailer Credo that now has more than 150 members from the beauty and wellness industries.

Participating in The Beauty Dropoff is Ulta’s latest step in an ongoing effort to become a more environmentally responsible company. Other actions the company has taken in the past few years include joining The Sustainability

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Consortium, a global non-profit organization dedicated to creating more sustainable consumer products.

As a member of TSC, Ulta Beauty engages in consumer goods industry environmental impact efforts and leverages TSC’s science-based resources and tools. Ulta Beauty joins more than 100 TSC members working together on projects spanning topics such as plastic packaging and circularity.

In addition, the retailer operates the Conscious Beauty at Ulta Beauty initiative, which is designed to help consumers identify clean ingredients; as well as locate cruelty-free, vegan, and sustainably packaged brands and products.

According to Ulta, its sustainability efforts have included diverting more than 14,800 tons of waste from landfill and, in 2021, investing $1.6 million in energy management system retrofits while working toward greater sustainable packaging across its full product assortment.

This story originally appeared on Chain Store Age

Meijer makes $2M donation to Midwest food bank partners

Meijer announced a surprise $2 million donation to 30 key food bank partners to help battle hunger in its local communities. These focused donations will create a larger impact helping the food banks to better meet the needs of those they serve, resulting in a positive ripple effect in communities across the Midwest.

For 90 years, feeding people has been at the heart of Meijer, with hunger relief being one of the retailer’s longest-standing philanthropic commitments. Meijer works with all parts of the hunger relief system including both food banks and food pantries. Food banks are large-scale operations that service dozens of smaller-scale food pantries that, in turn, service a smaller geographic region. This cooperative system is designed to efficiently get food to those who need it the most.

The food banks receiving the donation are:

♦ Akron-Canton Regional Foodbank

♦ Central Illinois Foodbank

♦ Community Harvest Food Bank of Northeast Indiana

♦ Dare to Care Food Bank (Louisville, Ky.)

♦ Eastern Illinois Foodbank

♦ Feeding America Eastern Wisconsin

♦ Feeding America West Michigan

♦ Feeding America Kentucky’s Heartland

♦ Food Bank of Eastern Michigan

♦ Food Bank of Northern Indiana

♦ Food Bank of Northwest Indiana

♦ Food Finders Food Bank (Springfield, Ill.)

♦ Food Gatherers (Ann Arbor, Mich.)

♦ Forgotten Harvest (Detroit, Mich.)

♦ Freestore Foodbank (Cincinnati, Ohio)

♦ Gleaners Community Food Bank of Southeast Michigan

♦ Gleaners Food Bank of Indiana

♦ God’s Pantry Food Bank (Lexington, Ky.)

♦ Greater Chicago Food Depository

♦ Greater Cleveland Foodbank

♦ Greater Lansing Food Bank

♦ Mid-Ohio Food Collective

♦ Northern Illinois Food Bank

♦ Second Harvest Food Bank of East Central Indiana

♦ Second Harvest Food Bank of Mahoning Valley

♦ Second Harvest Food Bank of North Central Ohio

♦ Second Harvest Food Bank of Clark, Champaign & Logan Counties

♦ South Michigan Food Bank

♦ Terre Haute Catholic Charities Foodbank

♦ The Foodbank (Dayton, Ohio)

The Future of AI in Pharmacy

What can we learn from Kerrville Drug Co., who is using AI technology to drive more profitability in their cash business?

By Miranda Rochol

With so much in the news about artificial intelligence, it’s hard to imagine all the ways the emerging technology will have an impact. But what if I told you the future of AI in pharmacy was already here—in rural Kerrville, Texas?

Case study: Increasing profitability for cash pricing in 30 days

Kerrville Drug Co., a single independent pharmacy nestled in rural Kerrville, Texas, exemplifies the challenge pharmacies face to balance competitive pricing and profitability.

Margie Hocker, pharmacy manager and certified pharmacy technician, recalled the days when they had to turn away cash-paying customers who wanted to use a popular drug discount card. The pharmacy couldn’t accept the card due to high, unsustainable fees charged back to the pharmacy.

“At one point, we had no choice but to turn customers away,” said Hocker. “But now we are able to offer our cash-paying customers something even better to help patients save on their medications.”

What changed? Kerrville Drug Co. implemented a unique cash pricing program from Prescryptive, a healthcare technology company.

AI: Balancing profitability with patient savings

At Prescryptive, we’ve harnessed AI to help pharmacists with their cash pricing through an AI pricing engine that analyzes opportunities based on many factors. Kerrville Drug Co. saw the difference:

Miranda Rochol

SVP of Provider Solutions at Prescryptive Health.

In 30 days, Kerrville Drug Co. saw a 96% increase in average per prescription profitability for cash pricing

6% increase in total cash claims processed in the same 30-day period

88% average per prescription savings for patients for cash pricing

Hocker at Kerrville said: “We have confidence that the patient is getting a good price, and our pharmacy improves its profitability. It’s very transparent. Very affordable. And customers’ information will not be shared. It’s just a win-win on both sides.”

When a patient advocate from a nearby hospital called Kerrville Drug Co. on behalf of a patient who was newly diagnosed with diabetes, “we were able to save the patient more money on his prescriptions than other popular discount cards. He has now become a regular customer—and his wife, too,” said Hocker.

A wider lens: What can AI do for pharmacies nationwide?

America’s pharmacies face major headwinds, battling reimbursement challenges, increasing fees and more. But there is an opportunity: a solution for cash-paying customers at the counter.

And pharmacies need a solution now, as the use of high-deductible health plans continues to grow. A 2023 study from Kaiser Family Foundation found enrollment in these plans increased over the past decade, from 20% of covered workers in 2012 to 29% in 2023.

With more cash customers at the counter, pharmacies can use AI to help increase profitability in one lane of their business. New profitability data from Prescryptive Health underscores the powerful potential that AI can bring to cash pricing: In a recent analysis, the gross profit margin in 2023 for Prescryptive AI Pricing was nearly 54%. NCPA’s recent findings for total gross profit margin in 2022 found that independent pharmacies averaged 21%.

But using AI for a cash pricing system isn’t just about numbers—it’s about empowering pharmacies like Kerrville Drug Co. to stay profitable while doing what they do best: patient care in their communities.

Miranda Rochol is the SVP of Provider Solutions at Prescryptive Health. dsn

Challenges for Pharmacy in 2024

Pressures mount for the industry in wake of financial, operational and regulatory pressures

Last fall I joined Inmar Intelligence because of the great opportunity to work with an organization that is a healthcare, technology and media company uniquely positioned to help stakeholders successfully navigate the healthcare ecosystem. With the NACDS Annual Meeting drawing near, I’m compelled to share the key market forces that are informing Inmar’s strategy going forward. Our priorities will continue to evolve and I am excited to gain more insights from our customers and partners during NACDS Annual.

Financial and operational pressures are mounting

The financial pressures faced by the industry are seriously affecting the viability of the traditional retail pharmacy business model and pressuring the ability of pharmacies to meet the expanding healthcare needs of those in the communities they serve so effectively. The geography of pharmacy deserts is expanding during a time when consumer access to treatment has never been more crucial.

Primary among these financial pressures is reimbursement. Inmar data from January of this year shows overall reimbursement rates for all lines of business down measurably from January 2023 as DIR fees are now reflected in the adjudicated rate.

On top of reimbursement challenges, pharmacies are also dealing with inflationary pressures, operational complexities and workforce challenges, while also needing to plan for an evolving business and care model that must accommodate and leverage

expanded scope of practice, automation and the influence of artificial intelligence in healthcare.

Regulatory obligations are expanding

Pharmacies are also challenged with increasingly complex and burdensome regulations impacting the supply chain, most notably USP <800>, the enactment of the Inflation Reduction Act and full enforcement of DSCSA.

For the latter, final implementation of the Act will hopefully bring value beyond compliance by increasing efficiency throughout the supply chain. However, turning this from an administrative burden to an efficiency gain will require a collaborative mindset across all stakeholders throughout the supply chain.

By Brian Nightengale Brian Nightengale Executive Vice President of Healthcare at Inmar Intelligence.

Consumer expectations and behaviors are changing

Today, consumers are thinking more holistically about their health and are playing a more active and informed role in their wellness journey. Their increasing engagement with outlets such as omnichannel pharmacies, telemedicine and social media is changing how they learn, what they expect from the retail experience and how they pay for care.

With evolving payer models that blend pharmacy, medical, wellness and even food programs into holistic health and wellness programs, it is incumbent upon all of us in the pharmacy industry to listen to consumers and find innovative and collaborative ways to meet them where they are so that we can stay true to our mission of enabling higher quality care, lowering costs and expanding access.

Our industry’s challenges will not go unanswered

It is well known that community pharmacies are highly accessible and affordable sites of care. With the predicted increase in primary care physician shortages and other access challenges in many parts of this country, the pharmacy profession is well suited to meet these needs. However, we must work collaboratively as an industry to address the reimbursement and scope of practice barriers.

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Making Her Mark

Crystal Lennartz spoke with DSN about her new role as president of Health Mart and Health Mart Atlas and the pivotal advice she offers to young women starting off in the pharmacy field

By Julianne Mobilian

Crystal Lennartz, Pharm.D., MBA, recently made history as the first female president of Health Mart and Health Mart Atlas in the franchise’s 26-year history. She previously served as vice president and general manager for Health Mart Atlas, leading McKesson’s Pharmacy Services Administrative Organization to be the largest, top-performing PSAO in the market. As community pharmacies expand their clinical services offerings, Lennartz is dedicated to helping pharmacies get fairly reimbursed for the care they provide to patients.

DSN caught up with Lennartz about her monumental new role, career background and the pivotal advice she offers to young women starting off in the pharmacy field.

“I would encourage women looking to take on elevated pharmacy roles to express interest to their leader and sponsors. Raise your hand as being willing to take on stretch projects or handle tough customer issues.”

- Crystal Lennartz, Pharm.D, MBA

Drug Store News: How has your background prepared you to lead Health Mart and Health Mart Atlas?

Crystal Lennartz: My experience in pharmacy has prepared me for this role in many ways. Fundamentally, I’m a trained pharmacist, and I have worked in or on behalf of pharmacies for 20 years. Since joining McKesson 11 years ago, I’ve taken on roles of increasing responsibilities with Health Mart and our payer solutions. Most recently, I served as vice president of Health Mart Atlas and Atlas Specialty, where I helped grow Health Mart Atlas to be one of the largest top performing pharmacy services administrative organizations on the market.

I’m enthusiastically committed to the advancement of pharmacy services and the impact pharmacists can have on public health, from vaccinations and screenings to medication therapy management and health equity measures. Throughout my career, I’ve worked in large chains, for the National Association of Chain

Drug Stores, and even as director of continuing education for Drug Store News, so I understand retail pharmacy and what pharmacies need to thrive and grow. Now, as president of Health Mart and Health Mart Atlas, I can focus exclusively on enabling and scaling solutions that support pharmacists so they can focus on what matters most taking care of patients.

DSN: What part of pharmacy are you most passionate about?

CL: I’m passionate about the pharmacy profession as well as advancing patient care. Advocating for people and issues I believe in fuels my passion in a genuine way. Throughout the past five years, I’ve focused on pharmacy performance and reimbursement for prescriptions as well as pharmacist services. By serving on the boards of McKesson’s employee Political Action Committee and Pharmacy Quality Alliance, I’m committed to helping advance healthcare policy as well as establishing quality standards that drive performance-based reimbursement. With continued support from McKesson, National Community Pharmacy Association, NACDS and continued industry collaboration, I’m hopeful we’ll see legislation at both the state and federal level to achieve provider status and pharmacy access goals.

DSN: What motivates you to go to work every day?

CL: It’s a privilege to work on behalf of our independent pharmacy customers because of everything they do for their community. But it starts with having a great team that is dedicated to staying connected to customers to truly listen to their needs so we can provide the solutions that help strengthen their pharmacy businesses and elevate the role they play in people’s lives.

DSN: What advice do you have for female pharmacy students or those who are just beginning their career? How can we get more women into elevated pharmacy roles?

CL: I would recommend they think outside the box. Most pharmacy schools prepare pharmacists very well for traditional careers in retail or hospital pharmacy, for example. Yet, as my career suggests, pharmacists can have an impact more broadly across healthcare and the business, whether it’s association work, with wholesalers or generally in the pharmaceutical industry. I would encourage students and young pharmacists to look for opportunities to get exposed to leaders and mentors in some of the non-traditional pharmacy areas to broaden their mindset. I’m thankful that my time at Drake and different mentors since have given me that opportunity.

Having terrific mentors has played a very big role in my success. So, I work hard to pay that forward, whether it’s building teams or giving back through McKesson’s Women Empowered employee resource group. I honestly feel like now as a mentor and sponsor I get just as much out of it as the mentee.

Building on this, I would encourage women looking to take on elevated pharmacy roles to express interest to their leader and sponsors. Raise your hand as being willing to take on stretch projects or handle tough customer issues. Sometimes as women, we think it’s

“I would encourage students and young pharmacists to look for opportunities to get exposed to leaders and mentors in some of the non-traditional pharmacy areas to broaden their mindset.”

- Crystal Lennartz, Pharm.D, MBA

necessary to check 100% of the boxes when applying for new roles and that’s not always the case.

DSN: You spearheaded the development of Health Mart Atlas DIR Assist last year. Can you provide an in-depth framework of the processes, challenges and successes from these efforts?

CL: To help pharmacies manage the financial pressures of the DIR fee collection changes that started in January, Health Mart Atlas developed DIR Assist, a voluntary, opt-in program designed to help pharmacies with cash flow challenges associated with the change. Pharmacies that signed up for DIR Assist last year are now receiving escrow funds they put aside through DIR Assist to help offset the “double dip” as some call it.

We started bringing awareness to the anticipated DIR changes back in 2022. Through conversations with Health Mart Atlas members, we found there was a need for a tangible method to help pharmacies weather through these changes. That’s what inspired the development of DIR Assist as one of the first proactive solutions on the market. With the rule now in effect, we remain committed to supporting our member pharmacies through this transition through financial planning as well as tools to help diversify and expand revenue.

DSN: Where do you hope to see the pharmacy profession in the next 10 years?

CL: As pharmacists continue to elevate their role in protecting the health and wellness of their communities, I hope they are fully recognized as vital and equal members of patients’ overall care team. Empowered with provider status, current and future pharmacists can focus not just on filling prescriptions for patients but being part of their total care team and responsible in part for the patients’ outcomes. dsn

New and Noteworthy

HRG’s five notable products from March

4 1 3 5

2

After seeing a slight dip in February, product introductions spiked for the month of March, continuing the strong start for the year so far.

For the month of March, suppliers introduced 272 new products, which is 62 more than the 210 they introduced in February and very close to the 278 products suppliers released in January. Waukesha, Wis.-based HRG reviewed 28 products in the health category, 213 items in the wellness sector and 31 items in the beauty aisle to see which ones stood out as Products to Watch.

Here are the ones to watch:

1. Advil Targeted Pain Relief Cream

Haleon said it has introduced the first topical pain reliever from Advil and claims it works on contact, at the source, for up to eight hours. Utilizing four pain fighting ingredients—menthol, capsaicin, camphor and methyl salicylate—Advil Targeted Relief Pain Relieving Cream is formulated to target fast relief of arthritis and joint pain, back and body aches, sprains and strains, and sore muscles with a specially designed massage applicator. It comes in a 2.5-oz. bottle.

2. Refresh Tears PF Lubricant Eye Drop

Refresh Tears PF eye drops from AbbVie is a preservativefree version of the original Refresh Tears. The drops are formulated to instantly moisturize and lubricate eyes to relieve mild symptoms of dry eyes in a multi-dose bottle. Designed for dry, sensitive eyes, the HydroCell technology is a NaClfree glycerin-based solution that enables rehydration while maintaining the volume of cells on the ocular surface. The drops come in a .33-oz. bottle.

3. Pepto Bismol Fast Melts Soft Chews

Procter & Gamble’s Pepto Bismol Fast Melts Soft Chew Tablets provide the same fast and effective relief as Pepto Bismol liquid with a soothing mint flavor, the brand said. The chews are formulated to coat the digestive tract to quickly provide relief from nausea, heartburn, indigestion, upset stomach and diarrhea in a new form. It comes in a 24-ct. bottle.

4. Vitafusion Wellness MultiSoft Chews

Church & Dwight claimed that its Vitafusion Daily Wellness Multi Soft Chew provides nine key daily nutrients per serving in a chew that offers more flavor and satisfaction. Each chew is individually wrapped for easy portability and convenience. The chews come in a 30-ct. bottle.

5. Bioré Aqua Rich UV Moisturizer SPF 30

Bioré Aqua Rich UV Weightless Moisturizer SPF 30 from KAO Brands is formulated to provide protection from the harsh effects of UV exposure, such as wrinkles, pigmentation, pore degradation and dehydration. Developed without oxybenzone and octinoxate, this lightweight hyaluronic acidbased moisturizer is designed to work well under makeup without clogging pores. It provides all day hydration with no white cast on all skin types. It comes in a 1.7-oz. tube. dsn

HRG Future 50

These products set themselves apart in 2023

Coming off of a relatively strong 2022, supplier-introduced new products slowed a little bit in 2023. The Waukesha, Wis.-based data and analytics company HRG reviewed 1,634 new health, beauty and wellness items in 2023, and came up with its list of the top 50 that stand a good chance of being successful on store shelves in the coming years.

“This is a decrease of 12.8% from the 1,875 products reviewed in 2022,” HRG said in a February release. “Of the newly introduced items in 2023, 18, or 1% of new items, never made it to the retail shelf as their launches were canceled by manufacturers sometime after their initial HRG review. The decrease in new product introductions is the fourth consecutive year that HBW launches have declined. It can be directly attributed to manufacturers focusing on managing continued supply chain irregularities and rationalizing the ranges for their current brand portfolios.”

HRG compiled the list using an unbiased, weighted review of promotional support, product innovation, importance to community pharmacy, earning and category growth potential to determine future performance. HRG’s category research and analysis team also reviewed key sales indicators and distribution within community pharmacies to select the new items trending to be the top 50 performers.

Several trends emerge in HRG’s analysis. Here are some of the highlights:

◊ Within the top five categories in independent pharmacy (cold & allergy, pain relief, diabetes management, vitamins & dietary supplements and digestive health), 425 new items were reviewed, with 70 of those products receiving a Star, or roughly 16.5%.

◊ The wellness classification, for the second consecutive year, had more product launches (776), than the beauty segment (626). Wellness products also earned the second highest quantity of Stars for 2023 introductions at 11.25%. Two of these wellness products received the sought-after threestar rating, one in the first aid category, the other in feminine care.

◊ The health classification had the largest percent of Stars awarded at 18%.

◊ The beauty classification experienced a continued three-year decline in overall product launches from 2022, with 3% of products being awarded HRG Stars.

◊ The gummy form is trending for a third year—when comparing the gummy form to the total new items for 2023, nearly 7% were in this popular form, spanning six categories. Some of the key treatment targets for these products are sleep, immunity, pre- and probiotics, and popular supplements such as magnesium and ashwagandha.

◊ Manufacturers continue to focus on the self-care trend by introducing products that focus on immune support and products that include elderberry. Another popular ingredient for 2023 was hemp, utilized as an aid in reducing pain, and it was popular in beauty regimen lines.

◊ Whitening products also increased in 2023, with consumers looking for personal treatment options. This subcategory increased in performance over 2022.

◊ The popular scent, lavender, was not only found in beauty products in 2023, it was utilized in health and wellness products as well, in categories such as foot care and cold & allergy.

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REFERENCES

1. Bari B, Corbeil MA, Farooqui H, et al. Insulin injection practices in a population of Canadians with diabetes: an observational study. Diabetes Ther. 2020;11(11):2595-2609. . Rini C, Roberts BC, Morel D, et al. Evaluating the impact of human factors and pen needle design on insulin pen injection. J Diabetes Sci Technol. 2019;13(3):533-545. 3. Frid AH, Kreugel G, Grassi G, et al. New insulin delivery recommendations. Mayo Clin Proc. 2016;91(9):1231-1255. embecta, formerly part of BD. BD is the manufacturer of the advertised products. embecta and the embecta logo are trademarks of Embecta Corp. BD and the BD Logo are trademarks of Becton, Dickinson and Company. All other trademarks are the property of their respective owners. © 2023 Embecta Corp. All rights reserved. BD-85393

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Bringing brand synergy to new heights

Will Righeimer, CEO of Hello Bello, discusses the strategic goals and the partnership opportunities the brand brings to Hyland’s Naturals

Will Righeimer, the newly appointed CEO of Hello Bello and CEO of Hyland’s Naturals, discusses the strategic goals and priorities ahead for Hello Bello and the new opportunities the partnership brings to Hyland’s Naturals. Check out what’s ahead for the brands in 2024.

Drug Store News: Thanks for speaking with us, Will. Congratulations on your appointment as CEO of Hello Bello. We understand you’ll continue to serve as CEO of Hyland’s as well. Do you mind answering some questions about these exciting brands?

Will Righeimer: Absolutely! It’s an honor to have this opportunity and we’re excited to share what this means for our customers.

DSN: What are you most excited about becoming the new CEO of Hello Bello?

WG: I’m really excited to work with two amazing brands that are trusted by millions of families. Hello Bello is still at the beginning of its journey and has incredible growth potential. Hyland’s is a mature brand with tremendous growth driven primarily through our continued innovation in the pediatric and women’s health categories. Together, our brands offer parents a robust portfolio of products to care for their families with clean and natural product offerings.

DSN: What makes Hello Bello unique?

WR: Hello Bello makes high quality premium products that outperform most brands on the market today. One example is our diapers - not only are they able to absorb well and provide a comfortable fit, they offer parents fun, catchy designs and capture the imagination of their young users. They add a bit of fun to the parenting journey.

DSN: Do you see any commonalities between Hyland’s and Hello Bello? How will customers and consumers benefit from the partnership?

WR: Absolutely! They both offer premium quality products that are accessible, in price and availability, and have loyal consumers who prefer cleaner, more natural products.

We are excited to partner Hyland’s with Hello Bello, because we serve the same customer, which is typically parents looking for the best options for their family’s wellbeing. We believe that together

we provide one of the most significant independent platforms for parents to keep their families healthy with clean and natural options. The synergy between our companies will empower us to provide unparalleled support to parents, from newborns to young children, through a comprehensive range of high-quality pediatric products and consumer healthcare essentials.

DSN: Can you share some of the strategic goals and priorities for the new partnership moving forward?

WR: Our top priority is to always put the customer first. We understand that this past year has been challenging for Hello Bello to ship products timely to some of its customers. At Hyland’s, we have worked hard to make sure we ship 100% on time and in full, everytime. It is our intention to immediately apply that same commitment to our Hello Bello customers just as we do at Hyland’s. With the new operational and financial resources we now have available to Hello Bello, we are certain that we can achieve this goal.

DSN: Can you highlight any specific challenges or opportunities that this partnership presents for the organization?

WR: This partnership with Hello Bello is new for all of us at both organizations. The Hyland’s team is very excited to partner with Hello Bello and its own team of passionate employees. We look forward to collaborating together and optimizing the strength of both companies. Ultimately, we are very excited for our two brands to work together to create a meaningful pediatric and general wellness platform to support the parenting journey.

DSN: What message would you like to convey to the loyal customers of both brands regarding this new partnership?

WR: We’re here for you! Our message to consumers is that between Hyland’s and Hello Bello, we believe we have the best high quality products to serve your family’s needs.

At Hyland’s, we’re excited to offer customers more than 15 new innovative pediatric and women’s health products launching in 2024.

For Hello Bello, we are back on track proudly producing millions of diapers each week in our Waco, Texas facility and we are dedicated to shipping 100% on time and in full. dsn

Will Righeimer is the CEO of Hyland’s Naturals and Hello Bello.

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Examining Medical Billing Opportunities Pharmacies Should Leverage

David Pope PharmD, CDE, Chief Pharmacy Officer, OmniSYS, XiFin Pharmacy Solutions

Pharmacies and their accessibility play an increasingly important role in the US healthcare system. The pharmacy landscape is evolving beyond simply filling prescriptions; it’s transforming into the front door of healthcare. Consumers across the country demand more convenient access to care, healthcare deserts that lack vital primary care resources litter communities nationwide, and advocates for improving community health continuously push for better health outcomes.

The reasons pharmacy teams are needed to shore up healthcare in the US are clear. Offering clinical care services in pharmacies can help fill in healthcare gaps nationwide. Venturing into clinical care gives pharmacies the leeway to drive revenue by tapping into medical billing and reimbursement. Here are the top three opportunities pharmacy teams should consider when exploring medical billing possibilities.

Legislative Changes Support the Expansion of Pharmacy Care

The movement to expand pharmacists’ roles has been underway for several years, and legislation supporting expanding the role of pharmacists as providers has been introduced in many states

As pharmacists play an increasingly important role in delivering healthcare services and helping patients better manage long-term chronic conditions, consumers get more convenient access to clinical care closer to home. In addition to better serving patients, more clinical services delivered at the pharmacy also play an important financial role for pharmacies, creating new higher-margin revenue streams.

A Looming Physician Shortage Creates a Care Gap that Pharmacists Can Help Fill

An Association of American Medical Colleges report estimates a shortage of more than 100,000 physicians in America by 2032. This includes up to 55,000 primary care physicians and up to 65,000 specialty care providers. There is also an ongoing nurse shortage that is expected to persist and grow. All of these factors make the pharmacist’s role as a provider of clinical services more critical and valuable.

While the looming physician shortage coupled with the accessibility of pharmacies to the vast majority of Americans creates a tremendous opportunity for pharmacies to deliver more clinical services, they need resources and technology solutions to optimize delivery and billing.

The Ability to Improve Efficiencies and Alleviate Administrative Stress

Across the country, pharmacists are dealing with escalating job demands as well as staffing shortages. This creates stress. Pharmacists need technology solutions that help them to improve efficiency, reduce administrative burdens, and alleviate staff stress so they can operate at the fullest extent of their licenses and begin to fill healthcare gaps.

To maximize reimbursement from clinical services, pharmacies need to augment their pharmacy billing systems with supplemental medical billing capabilities that integrate seamlessly into the current workflow and increase operational efficiency, while alleviating administrative workload.

Putting a Medical Billing Strategy into Place

Putting sound strategies, processes, and solutions in place is imperative to manage medical claims for clinical services via the medical benefit pathway. By augmenting the existing workflow and using purpose-built technology, pharmacies can be set up for success today and truly thrive in the future. Adding medical billing capabilities gives pharmacies the most flexibility to exploit new revenue opportunities as pharmacists are granted the ability to deliver a broader array of clinical services.

To fully support clinical service expansion, it’s more important than ever to have a revenue cycle management (RCM) technology or outsourced services solution to ensure maximum allowable reimbursement for the growing number of items covered under the medical benefit. To optimize the likelihood of reimbursement for medical billing, pharmacies must employ technology that offers comprehensive capabilities.

Whether delivered exclusively via technology or through an outsourced billing service, a comprehensive RCM solution will enable pharmacies to manage eligibility and benefits verification, front-end edits, and the end-to-end accounts receivable (AR) process for medical billing within the pharmacy workflow. These capabilities are critical to ensuring pharmacies maximize reimbursement for immunizations, clinical services, durable medical equipment (DME), and specialty drugs.

Explore our medical billing resources at OmniSYS.com/medicalbillingcompass to learn more.

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INDUSTRY IN TRANSITION

Integrating adjacent healthcare services businesses tops the agenda for operators

By Mark Hamstra

After several years of acquisitions and store expansion, the retail drugstore industry is now focused on the nuts-and-bolts that will be involved in transforming into a more holistic—and profitable—provider of healthcare services.

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In some ways, the major national chains are “deciding what they want to be when they grow up,” said Elizabeth Anderson, senior managing director and research analyst at Evercore ISI.

As a result, retailers are rethinking everything from the products they offer to the design and locations of their brickand-mortar stores. Importantly, they are seeking to determine how all of the pharmacy-adjacent businesses they have acquired, including clinics, can best work in tandem under each company’s broad umbrella.

“How do they evolve their businesses from the traditional pharmacy model, to ‘pharmacy retail-plus?’” said Anderson. “How do they think about scaling that business? How do they think about the right way for those businesses to link up with the core pharmacy business? Those are things they need to sort out.”

Aditya Kaushik, analyst at Coresight Research, said retail pharmacies are in a prime position to meet the healthcare demands of today’s consumers.

“With U.S. healthcare costs surging and the dearth of pharmacists continuing, an evolution in convenient, affordable healthcare services is the need of the hour in the U.S.,” he said in a recent Market Navigator report on the retail drug store industry.

As drugstores increasingly expand the services they offer, they have an opportunity to become “the next generation of primary care providers, treating patients with acute illnesses and chronic conditions, such as asthma, diabetes and hypertension,” Kaushik said.

He predicted that the U.S. drugstore and pharmacy sector would grow revenues by 4.7% in 2024, reaching $373.9 billion, after an estimated 7.3% rate of growth in 2023, which featured high inflation on some items. The growth in the year ahead will be driven by strong demand for prescriptions, overthe-counter products, and other health and wellness items amid a broad consumer shift toward prioritizing health and wellness, he said.

A Strategic Review at Walgre ens

With a new CEO at the helm and a host of other new executives joining the ranks during the last several months, Walgreens Boots Alliance is perhaps undergoing the biggest transformation among retailers in the industry.

It is still early in the process of figuring out exactly how its business will evolve, following the hiring of Tim Wentworth, the former CEO of pharmacy benefit management company Express Scripts, as its new CEO late last year. A Walgreens board meeting scheduled for April will include a strategic review that will set the stage for more specific plans about how the company will move forward, he recently told investors at the 44th Annual TD Cowen Healthcare Conference.

“There will not be a big bang after that where we announce and unveil some incredibly new Walgreens,” Wentworth said. “What you’ll see is that will be the starting gun for a lot of work that we have to deliver.”

He said the efforts to revive the positive trajectory at

We believe PHARMACY can fill a vital need in the healthcare ecosystem, both for access and delivery of care.”

– Jeremy Faulks, VP of pharmacy operations, Thrifty White

We need to look at the fleet not based on what it’s doing today, but what we need it to do in five years, given our services aspirations, and then reverse-engineer what that footprint should look like.”

– Tim Wentworth, CEO, Walgreens, at a recent TD Cowen conference

Walgreens—following a fiscal year in which the company posted a net loss of $3.1 billion—was “not a 12-month turnaround story.” Any initiatives the company undertakes, whether to expand or contract certain elements of its business, may take “time and thoughtful planning,” he said.

One of the key components of the strategic review will be the direction of the company’s approach to its physical retail stores, which currently number some 8,600 U.S. locations. It has closed hundreds of stores in the last few years, and last year said it would close another 150 by the end of fiscal 2024 in August.

“We need to get the footprint right,” said Wentworth. “We need to look at the fleet not based on what it’s doing today, but what we need it to do in five years, given our services aspirations and then reverse-engineer what that footprint should look like.”

Last year the company also said it would close about 60 Village MD clinics, after that company, in which Walgreens owns a majority stake, acquired another clinic operator, Summit Health+CityMD. Walgreens also acquired CareCentrix, a home care provider, and recently said it plans to retain another recent acquisition, specialty pharmacy Shields Health Solutions.

Anderson said Walgreens is focusing more on driving profitability after building up its revenues in recent years.

“For many companies that have been high-growth since COVID, now you are seeing a transition to focus on profitability,” she said.

Keonhee Kim, an equity analyst with Morningstar Research Services, agreed that Walgreens’ biggest challenges have revolved around building up scale and identifying the core markets in which it wants to operate. Former CEO Rosalind Brewer built up the business through acquisitions, and the company’s efforts

to drive profits from these businesses has been slower than expected, he said.

“Now with the new CEO, we expect Walgreens to focus more on core markets, which comes with closure of non-core locations, and right cost structure which will help with reaching its EBITDA targets,” he said.

CVS also in Early Stages of Integration

Rival CVS Health, meanwhile, in addition to operating a PBM, a health insurance company and the MinuteClinic enterprise, also has fortified its roster of health solutions providers, including home healthcare provider Signify Health and elderly care specialist Oak Street Health.

Speaking at the 42nd Annual JP Morgan Healthcare Conference in January, Karen Lynch, president and CEO, CVS Health, said the businesses will all work together to improve patient care.

“Our pharmacies, our retail health locations, our Oak Street clinics and our in-home capabilities will uniquely position us to deliver care in a coordinated way where people want to receive their health care,” she said. “What does that do? Well, it enhances our customer engagement. It lowers the total cost of health care, and it improves overall health outcomes.”

Other retail pharmacy companies, both large and small, have

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also expanded into related businesses, including Amazon, which has acquired One Medical, a provider of membershipbased primary care, and Walmart, which has opened more than 50 in-store Walmart Health Center clinics in five states and plans to open several more this year.

Many regional chains and independents have also been pursuing strategies to expand their suites of healthcare services.

At Thrifty White, for example, the company is focused on streamlining operations, building efficiencies and increasing capacity for its pharmacies to become involved in broader clinical services and patient care activities, said Jeremy Faulks, VP of pharmacy operations, Thrifty White.

“We believe pharmacy can fill a vital need in the healthcare ecosystem, both for access and delivery of care,” he said. “Our secret sauce includes leveraging focused patient engagement and delivering clinical interventions within workflow to improve outcomes and reduce the cost of care.”

The retailer is focused on rolling out new clinical services throughout 2024, including Chronic Disease Management for diabetes, remote patient monitoring, remote therapy monitoring, and Social Determinants of Health (SDOH) management by pharmacy-based community health workers.

Each of the company’s pharmacies has a dedicated Clinical Suite for providing professional services, with sinks, medical equipment and comfortable seating for direct patient care activities, Faulks said. It also has trained its teams to ensure they have the skills required to provide these services.

While these companies and others rethink their healthcare services business models, Rite Aid is seeking to compete in that environment while at the same time reorganizing under Chapter 11 bankruptcy. Since filing bankruptcy in October of last year, the retailer has announced plans to shutter more than 200 stores, sold its Elixir Solutions business and unveiled plans to sell other holdings, including a partial stake in Health Dialog.

Rite Aid in October named Jeffrey S. Stein, a veteran of several corporate restructurings, as its new CEO and chief restructuring officer. Since then, the company has continued its divestitures and recently launched a new ad campaign focusing on the connections between staff and customers with the tagline “It means more.” It continues to operate more than 2,000 stores.

Digital Efforts Gain Traction

In addition to technologies that hold promise for the streamlining of labor processes, drugstore retailers also are continuing to invest in ecommerce solutions, digital loyalty programs and other tech-driven solutions.

Speaking at the 44th Annual TD Cowen Healthcare Conference, Walgreens CEO Tim Wentworth said Walgreens seeks to “engage with the consumer where she or he wants to engage with us,” whether that involves ordering online for in-store pickup or delivery, or visiting the drive-thru, or coming into a brick-andmortar store.

“We’ve got to be able to deliver on all four of those really, really well from a technology-supported perspective, and we aren’t there all the way yet,” he said.

Executing e-commerce “requires a lot of systems talking to other systems,” he said, so that consumers have an accurate view of product availability while they shop online, for example.

As the company continues to invest in its omnichannel experience, it also ties into improvements in its digital loyalty initiatives, Wentworth said.

“Consumers respond fairly aggressively to welldesigned loyalty programs,” he said. “Walgreens actually had the best one back when they launched it, and we’ve kind of gotten away from investing in that.”

Jeremy Faulks, VP of pharmacy operations at Thrifty White, said the company also is responding to the rise of digital pharmacy start-ups. offering delivery, cash pricing and specific services tailored to disease states. “We do our best to combat this with similar offerings of our own, as well as continuing to double-down on the patient-pharmacist relationship,” Faulks said. “Overall, we believe our unique mix of in-person interactions, clinical services and local relationships will continue to differentiate us from the others and allow us to be a valued partner ins creating better patient outcomes.”

More Potential Acquisitions Ahead?

Aditya Kaushik, analyst at Coresight Research, said he believes additional acquisitions in the healthcare space could be strategic for retailers seeking to expand their market share or develop new capabilities quickly.

Potential acquisition targets include ecommerce and digital health companies, health clinics and urgent care centers, and independent pharmacies or regional chains.

“With the increasing trend towards online shopping and digital health services, drugstore chains may consider acquiring e-commerce platforms or digital health startups,” Kaushik told Drug Store News. “This can help them integrate technology, expand their digital presence, and offer innovative services to customers.”

Adding more health clinics and urgent care centers to their portfolio also can help drugstores provide convenient access to healthcare services, which can enhance the drugstore value proposition and create synergy between pharmaceutical services and primary care, he said.

Reimbursement

Remains a Headwind

The most pressing challenge that retail drugstores face continues to be around pharmacy reimbursement, which limits what services retailers can afford to provide in their stores, analysts said.

“We think reimbursement pressures from PBMs will continue to be a challenge,” said Kim of Morningstar, who noted that Walgreens said such pressures have been easing in recent years but are still prevalent.

Faulks said regional chains, and pharmacies in general, will continue to be under stress in 2024 from not only reduced dispensing reimbursement, but also the so-called “hangover” effect of DIR (direct and indirect remuneration) reform—higher up-front DIR fees coupled with lower patient copays, which could impact the profitability of independent pharmacies in the first half of 2024, according to the National Community Pharmacists Association.

“That said, we believe there is a role for specialized delivery of care, and pharmacies continue to be an underutilized resource in our overstressed healthcare system,” said Faulks. “If pharmacies can make the shift to delivering clinical services and supporting disease management, vs. just dispensing prescriptions, there is huge opportunity for pharmacy to fill this need.”

Another issue for the industry is how will it react to CVS’s rollout of its CostVantage reimbursement model, said Kim.

“We will keep a close eye on this to see how the marketplace will shift over the next couple of years,” he said.

CVS is early in the rollout of CostVantage, through which it will define the drug cost and related reimbursement with PBMs and payors, using a formula based on the cost of the drug, a set markup and a fee that reflects the value of pharmacy services.

Implementing technologies that streamline processes and automate repetitive tasks allows workers to focus on more valueadded activities”

– Kaushik of Coresight in an interview with Drug Store News

Technology and Labor

The labor pressures that boiled over in 2023 had been simmering since the COVID pandemic, when pharmacists were suddenly overwhelmed with testing and vaccination responsibilities, while also coping with new systems and procedures in their stores.

Retailers have cited the potential for technology investments that could help alleviate some of the pressures on its pharmacy workforce.

Implementing technologies that streamline processes and automate repetitive tasks allows workers to focus on more valueadded activities, Kaushik of Coresight said in an interview with Drug Store News. This includes automated dispensing systems that reduce the time spent on manual counting, for example.

“Eliminating these tasks allows pharmacists to focus on

more important tasks instead, such as counseling patients, giving vaccinations and testing for medical conditions,” he said.

Advanced software and analytics can also optimize inventory levels, ensuring that the right stock is available when needed, minimizing waste and reducing the burden on workers to manually track inventory, said Kaushik.

In addition, digital tools such as electronic health records and medication management systems help personalize patient care by enabling pharmacists to access patient information quickly and offer tailored recommendations and medication adherence support, he said.

The challenges retail pharmacy operators face in implementing these technologies and others include the costs, as well as concerns about data security and privacy, said Kaushik.

“These retailers are already cutting costs on many fronts … that could hamper their expansion in technology investment,” he said. dsn

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Self Checkout Checkup

What do shoppers really think about self checkout kiosks?

By Nigel Maynard

Self checkout was billed as a revolution in retail—a way for shoppers to save time, avoid long lines and, possibly, see lower prices. There is a big question as to the accuracy of those claims. Depending on the retail sector, the shopper and the purchase, self checkout is a boon or a bane—possibly both.

The self-checkout concept has been around in some form for 40-plus years, but the practice has accelerated in the last five years. In 2020, 29% of transactions at food retailers were processed through self-checkout, up from 23% the year prior, according to the latest data from food industry association, FMI, CNN wrote back in 2022. TruRating, a customer experience and insights company with U.S. headquarters in Atlanta, has completed a study of perceptions about self-checkout and wrote a subsequent report on its findings. Based on verified customer feedback in the real world, the study gives an accurate snapshot of why shoppers use self checkout and when.

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1. Ease of Use: “Was it easy to check out today?”

“There has been a move in more and more retailers to implement self-checkout options to try to increase throughput at the point of payment and also to reduce labor costs and shortages,” said Gareth Johns, chief data officer at TruRating. “The preferences and experiences of customers hasn’t been the main driver for this move and there has been little research into how customers feel about this major shift in their shopping experience.”

By all measures, self checkout is growing exponentially. “While originally a grocery innovation, self-checkout stations are now commonly found in stores of all sizes and verticals,” TruRating said in the report. “These machines are now so ubiquitous a part of the modern retail experience, that few seem to challenge the thinking behind them—in fact, the global market for selfcheckout is projected to grow from $4.51 billion in 2022 to $12.01 billion in 2029.”

The general consensus among responders is that there is a time and place for self-checkout, Johns says. Customers “welcome it as an option when it comes to payment, but they don’t want it to be the only or the default option, which too often it is. Also, most customers are just after

KEY TAKEAWAYS

Shorter wait time is the most important driver in making any type of check out experience ‘easy.’

Perceptions of checkout ease vary by sector, with manned checkouts often preferred. Considerations beyond technology, such as wait times and active terminal count, can affect these perceptions.

Retailers need to balance tech advancements with operational efficiency

94%

of customers we surveyed were happy to report that their checkout experience was easy.

a quicker way to pay, so if self-checkout doesn’t make payment quicker and easier for them then this move isn’t in their favor.”

Johns said the best model for retailers is to offer both self check out and human-operated registers in their store, and then manage the balance to minimize total wait time.

There was not much difference in sentiments about self-checkout among different demographics. Instead, differences were based on the type of store. “The bigger split was much more by sector with the vast majority of customers preferring self-checkout in a convenience store but much less so in fashion, apparel or other general retail,” Johns said.

Finally, the general message retailers should take from the study, Johns said, is to refrain from moving wholesale to self-checkout: give customers the option of both self-checkout and cashier checkout. “Also, don’t think that a move to assisted checkout is the answer, as what that actually means is that the store manager or member of staff decides on the checkout experience a customer has, not the customer themselves.”

2. Preferred Checkout: “Which checkout experience do you generally prefer?”

The preference for self-checkout differs considerably by sector—while convenience customers are less likely to report their checkout experience as easy, 70% would still prefer to use self-checkout. For retailers in apparel, this preference for selfcheckout dropped to just 25%.

The fewer the number of items in the basket the higher the preference for self-checkout. But what is interesting is that the tipping point at which more than 50% of customers prefer assistance was in one convenience retailer as low as just four items in the basket.

In general retail—where transactions tend to be more service orientated and speed of checkout is less important—we see that staffed checkout is the preferred option overall. What is interesting is that even for customers who end up using a selfcheckout option in this vertical, 40% still report a preference for staffed checkout lanes.

TIPS

WHILE CUSTOMERS ARE MOSTLY HAPPY WITH THE EASE OF THE CHECKOUT EXPERIENCE, THERE ARE A WIDE RANGE OF FACTORS THAT INFLUENCE PREFERENCE FOR MANNED VS. SELF-CHECKOUT, INCLUDING SECTOR, TYPE OF PURCHASE, AND QUEUE TIME. ALL NEED TO BE CONSIDERED WHEN EVALUATING A SUCCESSFUL PURCHASING JOURN EY.

KEY TAKEAWAYS

Self-checkout rules in the convenience sector.

Number of items in the basket have a direct impact on lane selection—know your tipping point.

Retailers need to ensure that self-checkout supports at least a full basket of shopping with room for growth.

UNDERSTANDING WHAT PUSHES A CONSUMER’S CHECKOUT PREFERENCE IS CRITICAL. BE SURE TO TAKE INTO ACCOUNT A VARIETY OF FACTORS, INCLUDING BASKET SIZE, CHECKOUT SPACE ACCOMMODATIONS AND AVERAGE QUEUE TIMES, TO NAME A FEW.

TIPS

3. Why SCO?: “Why did you use self-checkout today?”

Over 45% of the customers using self-checkout said their main reason for choosing to self-checkout was because they felt they had no other option.

KEY TAKEAWAYS

One size does not fit all.

Customers value having a choice in their checkout options.

Concern is increasing over ‘blurred’ assisted checkouts where staff, instead of customers, dictate the assistance level.

Despite retailers providing both self-checkout and staffed options, many customers feel self-checkout is their only choice, revealing a disconnect.

Perceived benefits: “What do you like best about self-checkout?”

The majority of customers responded that less wait time was the key immediate benefit of using a self-checkout terminal.

While this is an indirect and less obvious benefit of checkout automation it is one that customers at one of the retailers that use TruRating have still noticed. Perception of these other factors in the stores that rolled out self-checkout terminals was considerably higher than stores without self-checkout. These differences were, however, limited to the busy shopping period between Black Friday and Christmas when stores with staff on checkout duty struggled to complete these other tasks.

While this example shows there are positive benefits to checkout automation, the removal of a guaranteed staff interaction with customers can potentially have a negative impact. One retailer TruRating worked with saw that the move to automated checkout reduced the likelihood that customers were greeted by staff from 70% to less than 50%. For most retailers TruRating works with, the company said it has proven greeting customers not only provides an improvement in the customers’ overall experience but correlates to an increase in the average number of items in the shopping basket.

While self-checkout may allow staff to delegate tasks at checkout to automation, this does not mean they should abdicate their duty to serve customers more generally within the store.

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A Final Word

Gareth Johns, Chief Data Officer at TruRating

“We all know that the direction of travel for the retail industry, particularly in high volume sectors like grocery, is going to be toward more and more automation. The aim of providing a quicker and more frictionless checkout experience for the customer, in a way that is also cost effective for retailers— should be a win-win.

“However exactly how this journey evolves toward an increasingly automated future is one that will be a key concern for customers.

“Retailers need to think holistically about making the full end-to-end shopping experience as enjoyable and as easy as possible. This includes everything from the minute the customer enters the store. It certainly includes the time that customers spend waiting to get to checkout—and then of course the time spent at that till actually checking out.

“They’ll need to think about the types of customer in a given store and the number of items they are likely purchasing in a single trip. Are self-checkout terminals set up to meet those customer needs? What message does it send to customers if they have to wait to receive assistance or stand in line while self-checkout terminals remain out of order or turned off.

“The checkout is almost always the final experience the customer has before leaving the store. It is the thing they are most likely to remember and it can leave a lasting impression.

“Self-checkout is not for everyone—the best retailers will make sure they proactively offer an alternative checkout experience and that all customers are aware those options are available.

“Provide an appropriate choice of checkout experience for every shopper type and shopper journey—and customers will leave happy.”

GENERAL RETAIL

KEY TAKEAWAYS

Two thirds of customers choose self checkout because they think it will be the quickest way to complete checkout.

Deploying self-checkout can free up staff to spend more time on the shop floor improving other parts of the shopping experience for customers.

Self checkout can remove the only piece of interaction with staff for many customers and have a knock on impact on their spend and basket size.

Product Showcase

What’s expected from some of the participating companies at NACDS Annual? We have a sneak peek at some new products and services you can expect to see

NACDS Annual, held April 27-30 at the Breakers in Palm Beach, Fla., is the place where retail pharmacy’s most influential leaders gather to network, meet and gain insights into an ever changing market. It’s also a place where attendees can get a sneak peek at new and upcoming products, services and programs. We have gathered the ones you should see.

Ascend Laboratories, LLC

Space #460

Capecitabine 150 mg x 60s and500 mg x 120s is an oncologic that recently has been impacted by market shortages. Ascend has both the 150 mg in bottles of 60 and the 500 mg in bottles of 120 in stock and available. The company invites anyone looking for this product to reach out to their Ascend account executive.

Bausch + Lomb

Space #12, #432

The eye care company is driving growth in the eye care aisle with its OTC portfolio. Products include Lumify Eye Illuminations Blink eye drops and contact lens rewetting drops.

Camber Pharmaceuticals, Inc.

Space #534

Camber plans to launch 50 generic medications, submit 55 new ANDAs and secure FDA approval on 40 previously filed ANDAs in 2024. Camber’s portfolio is projected to encompass nearly 250 product groups spanning Rx, specialty and OTC markets.

Eagle Labs

Space # N/A

Eagle Labs does NSF Certified contract manufacturing for dietary supplements, skincare and OTCs.

• Solid dose – capsules, tablets, chewable tablets, powders. Available in bottles, canisters, gusset bags and stick packs.

• Liquid dose – liquids in tinctures and larger bottles

• Gummies – available in several mold sizes/shapes, packed in bottles or pouches

• Lotions – available in tubes, airless pumps and jars

Edgewell Personal Care

Space #6

The Weightless Hydration SPF 30 Mist for Face and Body features a tropic scent and is formulated to moisturize the skin. The alcoholfree formula does not dry out the skin or clog pores, and contains hyaluronic acid and aloe vera. The water-based products are designed to be pat into the skin—even when users are not wearing makeup, the company said.

iA (Innovation Associates)

Space #280

iA’s new Shared Central Fulfillment expands prescription fulfillment solutions across multiple pharmacy partners from a single fulfillment center creating a new network of connected fulfillment solutions. More pharmacies have more access to solutions that improve workflow, increase safety and free up pharmacists to spend more time providing quality patient care.

i-Health Inc., A Division of DSM

Space #514

Culturelle Bloating & Gas Defense is designed with a triple action formula to help relieve occasional bloating, gas and indigestion. The product is designed to help break down hard-to-digest foods and contains IntelliZyme, lactobacillus rhamnoses GG and ginger root.

* THESE STATEMENTS HAVE NOT BEEN EVALUATED BY THE FOOD AND DRUG ADMINISTRATION. THIS PRODUCT IS NOT INTENDED TO DIAGNOSE, TREAT CURE OR PREVENT ANY DISEASE.

Nestlé Purina Petcare Space #328

For 10 years, the Purina One 28Day Challenge has demonstrated the power of natural ingredients. After 28 days, pet owners making the switch will notice visible differences, including healthy skin and coat, healthy energy, a strong immune system and more, the company said.

Pharmavite

Space #24

Knapp Space #508

Knapp Pharmacy Solutions introduces its latest, high volume tablet dispensing systems for centralized pharmacy operation: Knapp Next Gen ATD (Automated Tablet Dispensers). The newest generation systems provide easier access for maintenance, full visualization with a clear front panel and fully electric controls. The ATD system uses the construction of earlier generation systems, and the latest counters are the basis of the company’s Mission Zero Touch pharmacy design approach.

OmniSYS

Space #619

OmniSYS, XiFin Pharmacy Solution’s revenue cycle management—available via technology or as an outsourced billing service—enables pharmacies to manage eligibility and benefits verification, front-end edits and the end-to-end accounts receivable process for medical billing within the pharmacy workflow

Pharmavite is a company in the health and wellness industry that aims to develop vitamin and supplement solutions backed by science as well as adhere to strict manufacturing practices. Through all its brands—including Nature Made, MegaFood, Uqora, Equelle and the recently acquired Bonafide—Pharmavite is dedicated to helping people live healthier, more vital lives, the brand said.

Piping Rock Health Products, LLC

Space #620

Piping Rock Health Products, LLC, announced that its brand, Nature’s Truth, is the No. 1 vitamin brand in Independent Pharmacy for the third year in a row, according to HRG’s proprietary PAC data, 52 weeks ending 12/31/2023. Nature’s Truth is currently more than three times the size of the next largest competitor within the overall Vitamins & Dietary Supplements category, within this PAC data view.

Quest Nutrition, A Simply Good Foods Company Brand

Space #246

The brand introduces Quest Iced Coffees, a ready-to-drink beverage that provides a boost of caffeine and coffeehouse taste without additional calories and sugar The iced coffees contain 1 g sugar, 90 calories, 10 g protein and 200 mg caffeine per serving.

Quest Products Health Care

Space #613

Quest Products is poised to announce the acquisition of Tec Laboratories. Quest will add Tecnu, which consists of itch relief products that treat poison ivy and oak, and Licefreee, a non-toxic head lice treatment, to its portfolio of self-care products.

RevSpring

Space #314

RevSpring offers digital patient engagement, payments and integration solutions. Designed to fit any pharmacy model from retail pharmacy to specialty, or in clinics and hospitals, the company said it has a unique solution set that fits. The end result is better patient engagement and improved bottom line, RevSpring said.

TruLabs, LLC

Space #406

TruLabs Hydrate now contains all-natural ingredients and is a zero-sugar, monk fruit extract sweetened, non-GMO electrolyte drink mix. It replenishes 19 vitamins and minerals, including five electrolytes. Per the brand, TruLabs’ blend contains five immune system boosters and six B vitamins. Hydrate is gluten-free, dairy-free, vegan and soy-free, with no artificial ingredients. The product contains five calories per serving.

Beauty’s Biggest Headlines

A blue-chip panel of beauty experts discusses how the mass market can carve out a bigger slice of sales and keep up with the blistering pace of new products

First

Second row:

Thrid

row left to right:

Achelle Richards, Larissa Jensen, Deborah Dixon

Meagan Wos

row left to right:

Jeremy Lowenstein, Kelly Sobol, Chris Lopez

The beauty industry is beating the odds. Sales are stagnant in most consumer goods categories, but beauty is soaring. Mass market beauty dollar volume increased 6% in 2023, according to Circana. We assembled a team of experts to discuss the industry’s biggest challenges and opportunities and what it will take to duplicate last year’s success for the category.

Milani is in a unique position, given our brand’s DNA of offering an inclusive, affordable luxury assortment that helps bridge the prestige and mass/drugstore customer communities.”

– Jeremy Lowenstein, chief marketing officer, Milani

DSN: Last year was solid, but many economic experts portend a slowdown. How would you describe the business climate so far in 2024?

RICH GALLUCCI, SVP OF SALES, KISS PRODUCTS: Cloudy with a chance of meatballs! The retail situation seems very guarded. Retailers appear to be concerned, and, in some segments, they are holding onto the reins very tight, wanting to let go but holding buying decisions to the last minute to gauge the economy. While some segments look good, others are struggling. The plethora of competitive brands flooding retail from the internet and overseas are not generating incrementality and in many cases are negatively impacting consumer trials with low quality products. New brands are simply not driving household penetration and growing the segments in many categories.

KELLY SOBOL, SVP OF NORTH AMERICA SALES AND CUSTOMER DEVELOPMENT, MILANI:

This year has had an interesting start. We’re still hearing rumblings about economic uncertainty and how consumer spending is being pressured, but beauty is and always has

been a resilient category—even when there’s uncertainty in the overall economy and other retail categories are struggling. And for brands like Milani, an uncertain economic outlook can benefit sales as consumers look for accessible priced, prestige-quality products. Also, although a few large retailers have shifted out timing on their in-store resets, beauty brands have come out punching anyway, with big launches and big moments. That shows that the beauty industry is definitely still focused on giving consumers what they demand.

LARISSA JENSEN, GLOBAL BEAUTY INDUSTRY ADVISOR, CIRCANA:

The beauty business climate so far in 2024 is tempered. Both the mass and prestige markets are still growing, but at a softer rate than we’ve seen over the past few years. As a result, we anticipate 2024 will be one of change. We’ve begun to see shifts in the types of beauty products consumers are purchasing, which could be indicative of a

INSIDE

move to value. In prestige, even as we see some continued spending on luxury products, there is a slowdown happening; alternatively, there is strong growth in minis and gift sets across beauty categories, and in fragrance, body sprays are picking up in popularity. Each of these types of products offers value in some way, from size to price. And this search value could be an opportunity for the mass market in that value is a true keystone of that channel.

MEAGAN WOS, CATEGORY INSIGHTS LEAD HAIR CARE/COSMETICS/ORAL CARE/INTIMATE HEALTH/ SEXUAL WELLNESS, EMERSON MARKETING:

As the concept of beauty continues to evolve, the industry has been quick to react to the demands of consumers. This year, the beauty sector is abuzz with discussions centered around advancements in science and technology, as well as a persistent commitment to enhancing sustainability practices. Moreover, the intersection of social media and corporate social responsibility is poised to significantly influence the success of brands and companies operating within this dynamic space.

DSN: Beauty as a category has been very resilient, yet in many categories, the prestige channel is producing increases that eclipse gains in mass/drug. How can we turn that around?

JENSEN:

While the mass channel is about convenience and value, the prestige channel is a destination and experience. To bridge the gap, mass retailers have opportunity across product, merchandising and environment. Recognize and translate the trends in prestige, then boost up those types of products or benefits in mass. And one of the biggest drivers in the prestige beauty market has been the treat [yourself] mindset. As a mass retailer, how can you create a space for beauty in your stores where consumers can feel they are treating themselves and not cheating themselves just to save money?

WOS:

The prestige beauty sector has experienced substantial growth in recent years and continues to exhibit resilience amid economic uncertainty and unprecedented levels of inflation. Even amidst such challenges, consumers remain unwavering in their commitment to high-quality beauty

M ass market beauty dollar volume increased 6% in 2023 , according to Circana.

products. A key distinguishing factor that elevates the prestige segment above other channels lies in its emphasis on the in-store experience. Within the realm of prestige beauty, the physical store surpasses mere retail space to become a destination in itself—a place where consumers can engage with products firsthand and create meaningful interactions with fellow beauty enthusiasts. In this highly competitive landscape, alternative channels vying for market share can enhance their appeal to consumers by prioritizing the in-store experience, offering comprehensive education, and delivering personalized service to help convert prospective shoppers.

GALLUCCI:

The market segments are very disparate. While the high end may be having a bit of a renaissance, the mass mainstream is still finding its ground in a guarded socioeconomic environment. Certain channels are doing well, and others are struggling. This is also negatively impacted by the continuation of inferior products being offered by e-commerce, which take sales and profits from leading legacy brands and do not build consumer confidence, loyalty or category growth.

INSIDE

JEREMY LOWENSTEIN, CHIEF MARKETING OFFICER, MILANI:

Milani is in a unique position, given our brand’s DNA of offering an inclusive, affordable luxury assortment that helps bridge the prestige and mass/drugstore customer communities. Milani’s quiet luxury positioning appeals to those already shopping traditional mass outlets, but our brand’s quality formulas also enable us to capture prestige shoppers.

Milani has remained one of the fastest-growing brands in the eye, lip and face category, posting double-digit growth for 30 straight periods. We’ve outpaced category growth for the last nine quarters, indicating that our quiet luxury appeal is really resonating with shoppers.

DSN: How are you keeping up with the need for new, especially as a way to compete with prestige?

TIM BUI, CHIEF MARKETING OFFICER, VITAL’S INTERNATIONAL GROUP/PURA D’OR:

We are in the process of R&D [on] new products that are adaptable to the growing trend. As a small company, we are able to make quick decisions and a faster R&D process. This year alone, we anticipate over 20 new products.

ACHELLE RICHARDS, VP PRODUCT DEVELOPMENT, ONYX BRANDS:

This year, we have new packaging and new messaging for our bath and body SKUs. We are bringing all of our nail, foot and bath categories under one cohesive master brand with a full restage. The heritage of our brand is professional premium quality at accessible price points.

DSN: Research shows Gen Z is returning to physical stores. Are you marketing more to Gen Z and Gen Alpha, or are mature consumers equally or more important for your brand?

BUI:

Yes! We are leveraging social media such as TikTok and Instagram to target Gen Z.

GALLUCCI:

We are well aware of the compelling stats around the Gen Z target, their overall buying power and their influence

on driving brand and product preferences across other age groups like Gen Alpha and even their parents. While our core brand demographic is 18 to 44, Kiss is a company whose products satisfy multiple age ranges and demographics. We generally target our core consumers, who are beauty enthusiasts. These are power users who are into beauty and drive incremental trips and increased market basket. By targeting the beauty enthusiast, we are also working on bringing new customers to the brand to increase household penetration in our core categories. In the social and digital world, our goal is to constantly innovate and create communities that want to share our products. Through innovation and community, we listen to our consumers and work to remove barriers to purchase.

DEBORAH DIXON,

PH. D., OWNER OF PRECIOUS MINERALZ:

Precious Mineralz Out Of Mountains products were formulated first and foremost for mature skin, so we are not actively marketing to Gen Z or Gen Alpha. However, we do have products that could be used by consumers in these age ranges. The formulations are robust and repair dry, cracked skin on lips and cuticles. Regardless of age group, there is a consumer base that spends a great deal of time outside during extreme weather changes, either for work or outdoor sports.

JENSEN:

The beauty industry has always placed a special focus on the younger consumer, with the idea that loyalty can be nurtured

This year, the beauty sector is abuzz with discussions centered around advancements in science and technology, as well as a persistent commitment to enhancing sustainability practices.”

– Meagan Wos, category insights lead hair care/cosmetics/oral care/intimate health/ sexual wellness, Emerson Marketing

Never.

At Edgewell, we strive to add joy to the everyday by infusing the per fect blend of pa ssion, innovation and individualit y into all of our personal care brands. We’re committed making extraordinary products that are not only fun to use, but also better for both our customers and our planet .

We make useful thing s joyful.

from an early age. The flaw in that thinking is twofold. First, the consumer of today is not loyal to brands, regardless of the beauty category. Second, by focusing on younger consumers, brands could lose sight of (or worse—completely ignore) the needs of the older and more affluent consumers. While understanding and meeting the needs of a younger consumer base is certainly important, we can’t ignore the fact that the largest consumer base spending the most money in beauty, across both mass and prestige, is the consumer who is over 55 years old. Ignore them at your own risk. Christopher Lopez, marketing director, Okay Pure Naturals: We like to not think of age. You might have an older person with acne or maybe a younger person interested in using sun care and SPF to reduce early signs of aging. Products cut across ages. What’s most important to retailers are the right price points and strong branding.

DSN: What are you doing to make products more sustainable?

GALLUCCI:

Kiss is committed to championing environmental and social sustainability. We have embarked on a global corporate sustainability program that focuses on the planet, people, and products. We’ve established targets and goals for our organization across all three of these areas. In the area of product, we have already begun to implement more

environmentally friendly packaging, utilizing almost entirely recycled, reusable or compostable materials, just as one example.

DIXON:

Precious Mineralz product containers are all recyclable. We also use numerous upcycled ingredients in our formulations. One key ingredient in the Rich Body Polish is Walnut Shell Powder, which has wonderful exfoliating properties. It is natural and biodegradable. Our unique raw material, Halloysite, is classified as GRAS (Generally Regarded As Safe) by the FDA. It is also on the Commodity Inert List of the USEPA. When we begin formulation on a new skin care product, we do give attention to the sustainable features of ingredients and the final formulation. It is very important to our company, along with a selection of vegan, cruelty-free and “clean” ingredients.

BUI:

We constantly work with packaging suppliers to innovate sustainable packaging materials. For example, our plastic is 100% recyclable, our facility is solar-powered and our shampoos are bio-based and biodegradable. dsn

30 YEARS OF EXCELLENCE: KING CONNECTION TH T TTE GET YOUR SKIN CARE AND SUN CARE PRODUCTS ON SHELVES FASTER

Cosnova Beauty

Eyes GROWTH

Cosnova founder Christina Oster-Daum and Jill Krakowski, chief marketing officer, USA, talk to us about the company’s growth, plans for the year and the importance of social media.

By Gisselle Gaitan

Listening and connecting to consumers led Cosnova to take a different marketing approach that has not included large-scale advertising. Instead, it used social media and content creators to help put products in front of shoppers.

Cosnova Beauty, a German-based beauty conglomerate and parent of viral brands essence Makeup and Catrice Cosmetics, has seen its sales double in three years.

In 2023, Cosnova reported net sales of 817 million euros, and the company is setting its sights on joining the top five global industry leaders.

DSN spoke to Cosnova founder Christina Oster-Daum and Jill Krakowski, chief marketing officer, USA, about the company’s growth over the last year, what’s ahead and the role of social media in rising popularity.

“Cosnova has been on an exciting trajectory. We’ve not only increased our market share across all global regions, including both brick-and-mortar stores and e-commerce platforms, but we’ve also broadened our retail presence,” said Oster-Daum. “Essence, one of our flagship brands, expanded its partnership with Ulta Beauty, gaining access to a wider audience. We successfully entered more than 300 Target stores. Additionally, Amazon remained our most important e-commerce channel.”

Over the past year, the company completed one of the largest sales years in its 23-year history—reaching $894 million and globally its net sales increased by 32%.

“We experienced significant organic growth in North America, where our sales surged by 23%,” said Krakowski. “In the U.S., we significantly expanded our market position. Our organic growth was an impressive 29%, demonstrating the strong demand for our brands.”

One reason for the growth is its willingness to listen to consumer feedback. “We regularly seek contact with our consumers to ensure that we develop products or solutions that they need or wish for. At Cosnova, staying in tune with our consumers’ voices e.g. through social listening is at the heart of our operation,” said Oster-Daum.

“Our users are keen to discover which brands and products resonate with their favorite influencers and why,” said Krakowksi. “They increasingly rely on influencers to navigate the ever-evolving ‘beauty world.’”

Essence has become a social media darling of sorts. The brand is popular among influencers across TikTok.

“TikTok, with its short-form videos, has allowed us to showcase our products in fun and relatable ways, while YouTube has provided a platform for in-depth tutorials and reviews,” said Krakowski.

Cosnova also works in the gaming space—specifically with Roblox, where the company debuted the “Fun Park” game with essence.

“Through interactive gameplay, we engage with Gen Z, showcasing our brand’s personality and expanding our customer base. It’s not just about cosmetics; it’s about fostering a lifestyle,” said Krakowski.

The company has plans to broaden its reach to an even larger global market.

“We’re committed to further developing markets in Latin America, the Middle East, Asia and Africa,” said Krakowski. “We see substantial potential for our brands in these diverse and vibrant markets.” dsn

SAVE THE DATE!

NOV 19-20

MARRIOTT MARQUIS CHICAGO 2024

Join us for the sixth annual Top Women Awards as we celebrate the exceptional women who are shaping and changing this industry.

The DSN Top Women in Health, Wellness & Beauty program applauds and recognizes women for their exceptional contributions to both their companies and communities.

Save the date and celebrate these extraordinary women who are influencing and transforming the health, wellness, and beauty industry.

FDA clears first OTC continuous glucose monitor

The Food and Drug Administration has approved the first overthe-counter continuous glucose monitor

The Dexcom Stelo Glucose Biosensor System is an integrated CGM intended for anyone 18 years and older who does not use insulin, such as individuals with diabetes treating their condition with oral medications or those without diabetes who want to better understand how diet and exercise may impact blood sugar levels. Importantly, this system is not for individuals with problematic hypoglycemia, as the system is not designed to alert the user to this potentially dangerous condition, the FDA said.

“CGMs can be a powerful tool to help monitor blood glucose. Today’s clearance expands access to these devices by allowing individuals to purchase a CGM without the involvement of a

healthcare provider,” said Jeff Shuren, director of the FDA’s Center for Devices and Radiological Health. “Giving more individuals valuable information about their health, regardless of their access to a doctor or health insurance, is an important step forward in advancing health equity for U.S. patients.”

The Stelo Glucose Biosensor System uses a wearable sensor, paired with an app smartphone or other smart device, to measure, record, analyze and display glucose values in people 18 years and older. Users can wear each sensor up to 15 days before replacing it with a new sensor. The device presents blood glucose measurements and trends every 15 minutes in the accompanying app.

WEST VIRGINIA EXPANDS ACCESS TO OTC COLD & ALLERGY MEDICATIONS CONTAINING PSE

West Virginia has enacted into law a new piece of legislation that lifts the annual purchasing limits for common over-thecounter cold and allergy medications containing the ingredient pseudoephedrine.

Previously, West Virginia had imposed annual purchase limits of 48 grams per person for products with PSE, roughly a six-and-one-half month supply. Senate Bill (SB) 688 amends that policy by increasing the annual limit to 86.4 grams per individual consumer, enabling allergy sufferers in West Virginia to purchase a full 12-month supply of congestion relief medications containing PSE.

In response, the Consumer Healthcare Products Association released the following statement:

“CHPA was pleased to see Governor Justice sign this legislation into law today, making these products more accessible to the West Virginians who rely on them for congestion relief,” said Carlos Gutierrez, vice president of state and local government affairs at CHPA.

Gutierrez added, “OTCs are a core attribute of our healthcare system, providing accessible, affordable, safe and effective solutions. Without them, 82% of people would seek professional medical attention for minor ailments, including allergies, further straining our already overburdened healthcare system. CHPA thanks Governor Justice, Senate Majority Leader Takubo, and Delegate Summers for prioritizing legislation that will not only increase access to the beneficial self-care products West Virginians depend on for relief but will alleviate undue burdens caused by costly and unnecessary doctor visits.”

Thirty eight states mandate the use of the National Precursor Log Exchange system, which is a real-time, stop-sale technology used by retailers and law enforcement to prevent the illegal sale of PSE to criminals who try to use it in the production of methamphetamine. In 2023, the NPLEx system successfully blocked the illegal sale of nearly 2 million boxes of medicines containing PSE. CHPA has been instrumental in advocating for the extension of the NPLEx system in multiple states, including in West Virginia.

CHPA said it takes the diversion of its members’ medicines very seriously and will continue working with elected officials to ensure states have the necessary tools to combat illegal sales of PSE. “Restricting sales of PSE could burden those who depend on these medicines for relief with unnecessary and costly visits to the doctor,” said CHPA.

NCPA, NASPA OFFER RESOURCE TO HELP PHARMACISTS IMPLEMENT POINT-OF-CARE TESTING

The NCPA Innovation Center, a supporting organization of the National Community Pharmacists Association, has teamed up with the National Alliance of State Pharmacy Associations to develop and release a new guidance document. The guidance document is designed to help community pharmacy teams with their point-of-care testing services. This work was completed with support from QuidelOrtho Corporation.

POCT involves screenings and tests that produce rapid, reliable results to aid in identifying, monitoring and treating acute infections or chronic diseases. In addition to enhancing patient care and improving health, it provides an excellent opportunity for pharmacies to expand revenue-generating services. The new document—“A Guide to Implementing Point-of-Care Testing Services in Community Pharmacy”—was developed to help with setting up and providing these services, marketing them in their

communities, and navigating reimbursement. Pharmacy teams should consult with their state pharmacy association or board of pharmacy for information on specific laws and regulations.

“Point-of-care testing has become increasingly important as community pharmacies seek to fill gaps in primary care and develop diversified revenue streams,” said Lea Wolsoncroft, president of NCPA. “This implementation guide provides an A-Z roadmap for pharmacists interested in offering this service in their practice setting and will be a valuable tool in doing so most effectively.”

“NASPA was excited to partner with the NCPA Innovation Center in creating this important resource for community pharmacists,” said Krystalyn Weaver, executive vice president and CEO of NASPA. “Pharmacists’ accessibility and expertise make them well positioned to assess and treat minor, nonchronic health conditions—a significant benefit for our communities.”

FDA PERMITS LIMITED CLAIM THAT YOGURT MAY REDUCE TYPE 2 DIABETES RISK

The Food and Drug Administration will permit dairy companies to say that eating yogurt regularly—at least two cups or three servings per week—may reduce the risk of Type 2 diabetes, according to limited scientific evidence, according to a letter posted on the FDA’s website, Reuters reported.

In 2018, Danone North America asked the FDA to approve the claim, after the subsidiary of the French company Danone SA became aware that the body of evidence was growing and becoming more compelling to support it, said Amanda Blechman, Danone North America’s director of health and scientific affairs, per the report.

The report also noted that Blechman said any yogurt maker will be able to use the claim on dairy-based yogurt. Danone’s competitors include General Mills, which makes Yoplait, and privately held Chobani.

Although many manufacturers add sugar to yogurt, the research showed that the benefit still applied, “regardless of sugar or fat content,” Blechman said.

In the letter, the FDA said it was concerned that the use of the claim on yogurts with a “significant amount of added sugars could contribute empty calories to the diet.” The FDA said it “encourages careful consideration” of whether to use the claim on yogurts that are high in added sugar, per the report.

The claim does not apply to non-dairy yogurts made from ingredients, such as almonds, coconut and soy, Blechman said, per the Reuters report.

ELSEVIER HEALTH RELEASES

CLINICALKEY AI SUPPORT TOOL FOR CLINICIANS

Elsevier Health is offering ClinicalKey AI, a clinical decision support tool that combines the latest medical content with generative artificial intelligence to help clinicians at the point of care. Elsevier partnered with OpenEvidence, a company specializing in AI for medicine, on the tool.

There is a current need for access to reliable, evidence-based medical information, especially when considering the volume of complex cases that clinicians are required to manage daily. In addition, staffing challenges are placing increasing demands on clinicians’ time.

ClinicalKey AI addresses this challenge by leveraging a personalized search interface to help clinicians find accurate information. The solution has been designed to provide curated content and evidence-based research to help clinicians provide optimal patient experiences.

“Designed for clinical practice, ClinicalKey AI enables faster and more precise answers to a wide variety of clinical questions from simple, high-frequency questions to highly complex questions requiring access to the latest scientific research, ” said Ian Herzhoff, president of Elsevier Health.

ClinicalKey AI’s search interface includes the following features:

¤ Optimized for natural language queries;

¤ Accurate information from multiple evidence-based content sources, including Elsevier’s large corpus of peer-reviewed content and other validated sources;

¤ Generates a summarized response based on evidence-based content sources and cited with references;

¤ Consideration to patient context, such as comorbidities and current medications, when prompted;

¤ Personalized responses based on the clinician’s profile; and

¤ Ability to ask follow-up questions and to access previous queries and responses;

¤ All content is licensed so clinicians and institutions can feel confident in the information they are using.

Elsevier Health and OpenEvidence collaborated with Cone Health and the University of New Mexico on the development of ClinicalKey AI, which was also used by more than 30,000 physicians across the United States.

“At the heart of our mission is the patient, and we are committed to providing physicians with the tools they need to make informed decisions,” said Jeetu Nanda, chief medical information officer at Cone Health. “Our work with Elsevier Health has allowed us to deliver a superior user experience, combining trusted medical content with advanced AI technology through ClinicalKey AI.” dsn

Under Lock and Key

Locking up products in the sensitive sexual wellness category can deter sales and hinder consumer education

By Debby Garbato

“Certain stores benefit from locking products. But generally, it’s more of a sales deterrent than a protective measure. It’s a pretty private purchase. Often, if consumers don’t have ready access, they’re too embarrassed to find someone to open the case,”

– Jeff Garlow, president, Satisfyer

May I please see that item?” is not a question many shoppers seeking sexual wellness products want to ask. But with more retail locations locking up these products, consumers can choose embarrassment and hunt down hardto-find sales associates or they can shop elsewhere—or online.

While locked products deter theft, they also deter sales in this highly sensitive category. According to an article in Fortune, sales can decline 15% to 25%when merchandise is locked. For sexual wellness items, the figure is likely higher. As for inconvenience, a test conducted by The San Francisco Standard found shoppers had to wait anywhere from 15 seconds to three minutes, 20 seconds for a salesperson to unlock merchandise. The locking tactic also reduces impulse purchasing. Industry experts estimate that up to 30% of retail locations lock sexual wellness products.

Some high-ticket items and store locations do have high shrink risks. But generally, experts believe locking many sexual wellness items is unnecessary.

“Certain stores benefit from locking products,” said Jeff Garlow, president of New York-based Satisfyer, supplier of vibrators, massagers and other “toys” along with personalized, compatible apps. “But generally, it’s more of a sales deterrent than a

The Pro 2 from Satisfyer

protective measure. It’s a pretty private purchase. Often, if consumers don’t have ready access, they’re too embarrassed to find someone to open the case.”

Carol Carrozza, VP of marketing for condom supplier Okamoto in Floram, N.J., believes margins and sell-through generated in self-serve environments outweigh any losses incurred from theft. “Numbers still don’t make sense when you lock it up,” she added. “It’s not like AA batteries. It’s so sensitive [that] consumers will go elsewhere.”

This is often true among shy teens and young adults, who may lack transportation and have only one store within walking distance. Locking up condoms increases vulnerability to unwanted pregnancies and STDs. “We market to millennials and Gen Z,” said Carrozza. “People aren’t talking to them about sexually transmitted infections. Today, we have the world’s highest rate of STDs.”

Putting products behind glass also makes it difficult to read labels and view items. Unlike other categories, sexual wellness does not lend itself to eye-popping, suppliersponsored displays and huge signage. “Inability to read labels is very prohibitive,” said Garlow. “It’s challenging to get the message out.”

This is particularly true of “toys,” whose suggested uses and configurations must be understood if consumers are going to shell out up to $100 for some items. “It requires

“Numbers still don’t make sense when you lock it up. It’s not like AA batteries. It’s so sensitive [that] consumers will go elsewhere.”

– Carol Carrozza, VP of marketing, Okamoto

education and research for people to decide what’s right for them,” said Lisa Tanzer, CEO of Beacon Wellness Products (formerly Clio), marketer of kegel trainers, vibrators and other pleasure devices.

Shrink is a huge problem for higher-priced items, which Tanzer believes are often re-sold online. “How do we prevent shrink but not impede purchasing?” she added.

Locking sexual wellness merchandise also stymies competition with e-commerce, which represents 55% of category revenue and is the fastest growing channel, indicated Vision Research Reports. “Stores need to compete with Amazon and other online retailers,” said Michael Trigg, founder,CEO of Trigg Laboratories, which markets lubricants. Trigg said he has not seen any retailers lock products across all doors. “It’s locationspecific based upon region, store size and demographics,” he added.

At a CVS in an affluent part of Mount Vernon, NY, sexual wellness items are kept under lock and key.

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Potential Solutions

Retailers and suppliers are employing various methods to deter theft and improve POP education. Not all have been successful. Trigg, for one, has tried offering a shrink allowance to “move our product from behind glass,” said the CEO. “Often, we’re unsuccessful as it’s a category decision.”

Lowe’s, Kroger, Safeway, Family Dollar and U.K.based Sainsbury have experimented with Indyme’s Freedom Case technology across various categories. Customers sign up with their mobile numbers and receive a custom PIN to access a locked shelf. But when Sainsbury made its loyalty program part of the process, shoppers complained there were too many steps.

Okamoto is placing source tags inside condom boxes. If people try to pilfer items, sensors go off. The downside is that sensors increase prices by about 10%. “We’ve been asked to do it to reduce loss,” said Carrozza.

With “toys,” she suggests using a window box so shoppers can view items. “People may not be well educated about them,” she added.

Beacon is using more QR codes and product videos. “They must be able to read the box,” said Tanzer.

Sexual Wellness Continues Growing

“These are things you can do on the shelf. If they must ask someone to retrieve products, they’ve already compared them.” But Trigg cautions that locked cabinets or internal shelving can block or hinder ability to read and scan QR codes.

Satisfyer spends time engaging shoppers outside the store social media and by contributing to articles in consumer publications. Emphasis is on psychological benefits of sexual wellness and potential uses of its toys. “Much outreach comes from media partners,” said Megwyn White, director of education. “We’re a resource for different types of sexual wellness questions. Sexual health facilitates sleep, improves the immune system and overall mental health.” Satisfyer also is exploring QR codes.

She cited a January article in Benches highlighting Satisfyer’s finger vibrators. “I was able to discuss erogenous zones that are generally missed. People often don’t know anatomy and it’s a barrier to entry. These connections help.”

It is hard to say if retailers will continue to augment the number of locations where products are locked. “You can understand retailers not wanting to lose money,” said Tanzer. “Shrink is growing. But you don’t want to keep the category from people. We bring this up with retailers all the time.” dsn

The U.S. market for sexual wellness products continues growing, with U.S. retail sales reaching about $12 billion in 2023, up almost a billion dollars from 2022. The momentum should continue, with Vision Research Reports predicting sales of more than $23 billion by 2032.

E-commerce comprises the lion’s share of sales and is experiencing the fastest growth. At the same time, big box retailers are devoting more shelf space to the category and are increasing revenue. In products, sex toys (84%) dominated sales, partly due to some higher price points. And personal lubricants are expected to experience the highest CAGR during the forecast period.

Source: VisionResearchReports.com

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Prioritizing Lower-Priced Biosimilar Medications

Legacy PBM business models are fundamentally misaligned with the needs and interests of plan sponsors and their members

During the past year, there has been a lot of buzz about biosimilars as lower-cost alternatives to biologic drugs. As you know, biosimilars are biologic medications that are highly similar to drugs already approved by the FDA. They are used for treating the same conditions and have the same mechanism of action as the reference, or originator products. Through clinical trials, biosimilars have been proven to be just as safe and effective as their reference biologic drugs, meeting the same quality standards.

There is a growing expectation that biosimilars will transform the specialty drug landscape just like generic drugs did for traditional medications. They can increase access to important therapies and improve patient outcomes, all while providing a lower-cost option for patients.

My company, EmpiRx Health, has been an early adopter of biosimilars because they offer the same level of safety and effectiveness as the original products, but at a lower cost— sometimes substantially lower. In fact, we were one of the first PBMs that started to prefer lower cost biosimilars to original products. One must question why other PBM organizations have not readily embraced these lower cost biosimilars when they provide the same efficacy, just at a reduced cost.

Here’s the unfortunate truth: Many other PBM companies are not prioritizing the lower cost biosimilars because doing so would run counter to their business models. These legacy PBM business models are fundamentally misaligned with the needs and interests of plan sponsors and their members.

This issue came into stark focus earlier this year with the launch of seven different biosimilars for Humira, a drug that has represented a significant portion of health benefits plan spending since

By Danny Sanchez

Danny Sanchez is the CEO of EmpiRx Health. Will PBMs stick with their old business model, which maximizes drug rebates at the expense of plan sponsors and their members, or will they embrace the value-driven approach that puts customers and patients first?

its introduction in 2002. The pricing for the new Humira biosimilars fluctuated widely, with some products being just 5% lower than the original drug’s list price, while others were priced more than 80% less. If all PBM companies were truly focused on meeting the healthcare and financial needs of their customers and members, there would be a near universal inclusion of the lower priced Humira biosimilars in the formularies of these PBMs. But that has not happened.

EmpiRx Health was the only PBM that decided to prefer the lower cost Humira biosimilars in its formularies. Prior to making this decision, EmpiRx Health’s pharmacy experts performed a thorough review of available clinical data, dosing and formulation options, and other critical factors impacting member experience. Following that comprehensive review and analysis, we decided to select two of the lowest priced Humira biosimilars for our formulary. This Humira formulary decision was consistent with our value-based, clinically-driven pharmacy care approach, which puts the pharmacist at the center of the care model.

I believe how PBM companies respond to the growing biosimilars opportunity is another crucial test for our industry. Will PBMs stick with their old business model, which maximizes drug rebates at the expense of plan sponsors and their members, or will they embrace the value-driven approach that puts customers and patients first?

We invite our PBM colleagues to join EmpiRx Health in transforming the pharmacy care industry for the benefit of customers and their members/patients. Embracing the lower priced biosimilars is a good place to start. dsn

Danny Sanchez is the CEO of EmpiRx Health.