Digital Pharmacies: Disrupting the Industry or Adjusting the Focus?

Last week, Dr. Adam J. Fein of Drug Channels, a blog popular in healthcare circles, posted an important article titled “The Promise and Limits of Digital Pharmacies.” After reading the piece, we wanted to add to the conversation.

First, what’s the difference between a digital pharmacy and a brick-and-mortar one? How are digital pharmacies “disrupting” the industry? To understand the situation, let’s consider how patients traditionally get their medication.

  • The patient chooses to see a doctor.
  • The doctor prescribes medication. Sometimes the patient is given a printed-out prescription, but more commonly the doctor sends the prescription electronically to the patient’s preferred pharmacy.
  • The pharmacy dispenses the medication, labels it, bags it, and notifies the patient that it’s ready for pick-up.
  • The patient goes to the pharmacy, pays their copay or pays out of pocket, takes their prescription home, and begins their therapy.

Digital pharmacies perform many of the same services as traditional pharmacies. They don’t represent an overhaul of the pharmacy business model. But they are adjusting the process of getting prescription medications to be more patient-centric. In his article, Dr. Fein defines the business strategies that most digital pharmacies use to streamline the experience:

  • Telehealth consultation, so patients don’t have to find a doctor on their own.
  • Home delivery, which eliminates the need to travel to the pharmacy.
  • Mobile apps that allow patients to manage their medications, request refills, and schedule or track deliveries.

That first point is important. As Dr. Fein says, “Competing to dispense low-priced generic prescriptions will not provide above-market profits.” Combining digital pharmacies with telehealth is the innovative part. When we took a look at digital pharmacies in our 2020 industry report, “Bringing Healthcare Home”, we also saw telehealth as a major differentiator for digital pharmacies. But we agree with Dr. Fein – it’s unclear how much impact these combination solutions will have on healthcare overall.

Digital Pharmacy without Telehealth

Digital pharmacies that don’t offer telehealth are increasingly common. They act like any other pharmacy when it comes to drug dispensing: they have most of the medications a patient might need, and doctors can e-prescribe directly to them. The difference: prescriptions are shipped directly to the patient via ground carriers like USPS and FedEx. The patient doesn’t need to make a special trip to the pharmacy. That's a major benefit for patients who are too sick or too busy to leave home.

However, not all digital pharmacies are licensed in all states, and there may be restrictions on which medications can be sent through the mail. Plus, shipping will delay a patient’s therapy for a few days. This isn’t always negative if a patient is healthy enough to wait for their medication, but that’s not always the case. Out of your prescription and need a refill today? Kids suffering from ear infections and need to start antibiotics ASAP? You’ll either need to wait or go back to your local pharmacy.

Digital Pharmacy with Telehealth

Digital pharmacies with telehealth solutions function like their dispensing-only counterparts, but with an additional layer of convenience. Patients don’t need to have a primary care physician. If they believe they would benefit from a prescription, they can schedule a telehealth appointment right on the pharmacy website. If the telehealth physician prescribes medication, the digital pharmacy will fill it. Then, like dispensing-only pharmacies, they will ship the prescription directly to the patient.

These platforms tend to be easy to navigate and pleasing to the eye. But they are limited in scope. Dr. Fein says, “To date, this market has been limited to product categories with a high proportion of cash-pay prescriptions and a big dose of self-diagnosis.” Digital pharmacies with telehealth platforms depend on patients coming to them with a prescription in mind. They expect patients to value convenience over all else and to forgo their insurance in order to pay cash for their telehealth appointment and prescription.

Dr. Fein states, “It’s not yet clear how far this niche opportunity can expand into new-to-therapy prescribing for medically complex conditions.” So far, digital pharmacies with telehealth appear to be most useful for simple, straightforward prescriptions.

The Possible Impact

Even if a patient only needs simple prescriptions, using digital pharmacies can complicate their care. Since online providers and pharmacists do not have access to a patient’s health history or full drug list, patients need to take a more active role in record-keeping. To avoid duplicated prescriptions or drug interactions, they will need to communicate with all of their providers about their medications. To avoid lapses in therapy, patients will need to keep track of which prescriptions are coming from which pharmacy and keep delivery times in mind when requesting refills.

That said, Dr. Fein believes that digital pharmacy start-ups will force the industry to “improve their businesses and approach to patients.” As a patient-focused organization, we think that’s a great thing. We like the idea that digital pharmacies can push the industry to consider patients’ points of view and make healthcare simpler. After all, that’s what we do.

But ScriptDrop has taken a different strategy. We are not a dispensing pharmacy. We don’t compete with existing pharmacies. Instead, we partner with pharmacies to help them get medications off of the shelf and into the hands of their patients. Interested in working with us? Learn more and reach out today!