THE QUESTIONS
1. What are “Drug Channels”?
2. What topics do you cover on Drug Channels?
3. Why do you write this blog?
4. Who reads Drug Channels?
5. Who are your clients?
6. Do you discuss confidential or non-public information on Drug Channels?
7. I’m an investor. How can I schedule a call with you?
8. Do you invest or own stock in the public companies that you mention?
9. Aren’t you just a shill for…?
10. Can you suggest some good books about the pharmaceutical industry?
THE ANSWERS
1. What are “Drug Channels”?
This blog is about marketing channels for pharmaceuticals (aka drugs). Marketing channels are the routes to market used to sell every product and service that consumers and business buyers purchase everywhere in the world. A channel is a set of interdependent organizations involved in the process of making a product or service available for sale. (Source: Marketing Channels.)
The companies and organizations in the channel successfully ensure that prescription drugs manufactured in truck-load quantities ultimately end up being delivered and dispensed in an appropriate quantity – say, a bottle with 30 pills – to an individual patient. There are three primary channel flows within the U.S. pharmacy distribution and reimbursement system:
- Product movement, which covers bulk distribution from pharmaceutical manufacturers to the drug wholesalers that supply pharmacies. A pharmacy marks the final step when a prescription is dispensed to a patient.
- Financial flows, which transfer money from third-party payers to Pharmacy Benefit Managers (PBMS), who in turn reimburse pharmacies. Funds flow to manufacturers via pharmacies, which purchase drugs from wholesalers.
- Contractual relationships, which govern the relationships between payers and PBMs; PBMs and pharmacies; pharmacies and wholesalers; wholesalers and manufacturers; and manufacturers and PBMs.
Hence, Drug Channels. 2. What topics do you cover on Drug Channels?
Every year, Americans fill nearly four billion prescriptions. The companies that facilitate the supply, dispensing and payment of our drugs – pharmacies, insurance companies, pharmacy benefit managers (PBMs), supermarkets, mass merchandisers, and drug wholesalers – absorb more than one-quarter of the $250 billion spent in the U.S. on outpatient prescription drugs.
Drug Channels provides an accessible behind-the-scenes look at this highly dynamic part of our health care system. I also examine the ways in which these companies affect – and are affected by – brand and generic pharmaceutical manufacturers.
Given the regulatory and financial role of the government, I also spend a considerable amount of time looking at regulations and legislation that deal with issues such as pharmacy reimbursement, pedigree, Part D, etc. You can see a list of topics on the left hand side of the page.
You should also check out my occasionally updated Best Of list.
3. Why do you write this blog?
The traditional drugstore has evolved into a complex network of multi-billion-dollar public corporations that manage the distribution, dispensing, and payment of our prescriptions. The strategies and decisions of the companies in the pharmacy industry affect us all: which drugs our insurance plans cover; where we will fill our prescriptions; how much we will pay out of our own pockets; and our likelihood of choosing a generic drug.
I make Drug Channels freely available as part of my mission to educate, inform, and challenge people about this system. I feel fortunate to have been similarly educated in many private emails and conversations that were sparked by the blog.
The discipline of writing a blog also forces me to stay current with new developments, which helps keep me energized and engaged. I have fun thinking about ways to use Spinal Tap or Monty Python references!
Of course, the blog has turned out to be an unexpectedly valuable tool to build my practice. Existing clients read the blog and contact me for “the inside scoop” and specific application to their business. I have also “expanded the envelope” by writing about a wide range of topics, allowing me to generate new conversations with existing clients and add new types of clients.
So, as long as a few readers hire me for consulting work or speaking engagements, then I can afford to pay my mortgage and keep this site free for everyone else.
4. Who reads Drug Channels?
Drug Channels is written for anyone who wants to understand how the pharmaceutical industry works. Based on domain names from web traffic logs, the blog is widely read by people at companies throughout the healthcare industry, including (but not limited to):
- Manufacturers
- Drug wholesalers
- Pharmacies (all types)
- Investors
- Insurers
- PBMs
- Providers
- Payors
- Government agencies
- Law firms
Click here to see a list of domain names that visited Drug Channels. As you can see, it's a Who's Who of the industry. You can view summary traffic stats at the bottom of the right hand sidebar.
5. Who are your clients?
Pembroke Consulting's clients are senior executives seeking to make better strategic and tactical decisions for their companies. My clients are executives at manufacturers of pharmaceuticals, biopharmaceuticals, or medical devices. I also work with trade associations, technology companies, law firms, institutional investors (via Gerson Lehrman Group), private equity firms, and other participants in the healthcare value chain.
Check out my corporate site for more info.
Was that a shameless plug?
Yes.
6. Do you discuss confidential or non-public information on Drug Channels?
No. The analyses on this website are based on information and data that is in the public domain. I NEVER (a) disclose material, nonpublic information about a public company; (b) disclose information that I have a duty to keep confidential (e.g., by agreement, fiduciary duty, etc.); or (c) disclose information that I obtained from any person who expects me to keep it confidential.
Whenever possible, I provide links to the original source material so that you read it for yourself and make up your own mind.
7. I’m an investor. How can I schedule a call with you?
I currently consult with institutional investors via an exclusive relationship with Gerson Lehrman Group (GLG), where I am a Leader in their Health Care Network. If you are a GLG client, then you can contact your representative to schedule a consultation or make a web request at my GLG home page.
8. Do you invest or own stock in the public companies that you mention?
No. I do not invest or own stock in any individual public companies. I only own stock through general mutual funds. Please note that Pembroke Consulting, Inc. does not make investment recommendations, on this website or otherwise.
9. Aren’t you just a shill for [Big Pharma / PBMs / Insurers / Knights Templar / Hollow Earth theorists / Birthers /blah blah blah]?
Nope. My philosophy in writing this blog can be summed up with a quote from the late Senator Patrick Moniyhan: “Everyone is entitled to his own opinion, but not his own facts.” In my own way, I want to bring facts and balance to subjects that don't get sufficient or accurate coverage from traditional media outlets.
I am opposed to unsupported accusations, overwrought hyperbole, or just plain misrepresentation. One of my consulting advisory clients told me that he values my opinions because I’m a “tough, cynical hard-ass.” Believe it or not, I took his comment as a compliment.
My job (on the blog and elsewhere) is to tell people the hard facts and help them figure out what it means.
10. Can you suggest some good books about the pharmaceutical industry?
Sure. Check out this post from July 2008.
