We’ve Moved ! Here’s What’s Going On…

We've Moved direction sign with a beautiful day

Greetings and New Year Salutations! From here on out, you will find us at www.functionalpharmacy.com

Exciting things are happening here at Pharmacist Integrative and Functional Pharmacy…all designed to help your pharmacy Sell More Wellness…and help your communities and greater ways.

Our New address is www.functionalpharmacy.com , as you will see, we are still decorating and putting things in place, although you will find the blog is active, and some new and exciting offerings are on their way.

Go over to www.functionalpharmacy.com now, make sure you sign up for the email list, and we will shoot you over a free special report to boost your wellness practice and crush the competition.


What Apples Mega Growth Can Mean To Your Business

Hands with smartphones and tablet over the table with laptop, notepad and coffee

Apple just announced its 4’th Quarter and end of year numbers, and it further proves the phenomenal business model that they execute.

Sure Apple is ahead of trends, and its most likely because they create many of the trends, although looking at the results of their 4’th quarter, should tell you a direction you should either add, or enhance to your marketing prowess- mobile!!!

You and your business have to be accessible to mobile technology

As you read this article, keep in mind that we are becoming an even more “instant gratification based society” and we want things now.

This is the same with your customers, and I can guarantee a big chunk of time they spend each day is on their mobile devices.

Apple understands this, and they are capitalizing via innovation of technology.

Once you grasp this, you will be able to capitalize by getting in front of your customers more often.

Let’s talk about Apple’s 4’th quarter and year end reporting:

Year-on-year, revenues increased by 22 per cent and profits by 31 per cent, driven by ‘record fourth quarter sales of iPhone, the expanded availability of Apple Watch, and all-time records for Mac sales and revenue from services’, according to Apple.

You might have noticed, I did not mention tablets…and that’s because tablets experience a 19.5% drop from the year before…but don’t worry, you don’t need to cry for apple, they have things covered.

  • The company sold 48m iPhones during the quarter, a 22 per cent increase year-on-year globally
  • In China, iPhone sales rose by 120 per cent – iPads, down 20 per cent.

“Fiscal 2015 was Apple’s most successful year ever, with revenue growing 28 per cent to nearly $234bn. This continued success is the result of our commitment to making the best, most innovative products on earth, and it’s a testament to the tremendous execution by our teams,” said Apple CEO Tim Cook.

This is all about what Tim Cook calls “cannibalization of the iPad.”  According to Cook, that cannibalisation is being done by the iPhone and the Mac, not by rival devices. People are coming on board with the iPad, but once on board they’re buying iPhones or MacBooks.

iPad has fallen into a “loss of identity” with the ever growing possibilities of the iPhones. Now with the size and capability of the iPhone 6S plus people are claiming they use their iPad even less, as the iPhone offers portability, readability and capability. For the more advanced computing, then there is the macbook pro.

Look at some of the current stats that are pointing to an even greater mobile world.

  • 44% of facebook users are mobile only- which has doubled in two years
  • US smartphone ownership – up from 35% in 2011 to 64% now, with 19% of owners using their phone as their primary internet device 64% of the US population has smart phones, and 19% use them as their primary online device
  • 50% of searches on mobiles, were not done on Google. What this means is that people are opting for apts, not going to the internet search engines because apps are faster…thus further affirming the “Instant Gratification” trend of consumers.

…the trends are all pointing in the same direction: smartphones are winning, and any way to make the users experience faster, easier, and more enjoyable will further enhance your business and your brand.








Why Kroger Can Do This, But You and Whole Foods Can’t (and shouldn’t even try)


Have you ever been frustrated by that large chain pharmacy giving medications away for free? Or even that mail order compounder who dramatically undercuts what should be considered a usual and customary price, or worse yet, takes their predatory “coupon skills” to your back yard, calling on your docs?

The simple truth is, some companies can dramatically undercut and sell products at a loss, basically because they are goliath, they are big enough to absorb the loss in other areas…but that’s OK.


They might say that they do it to ensure their customers get their medications at a reasonable price. Or in the case of Kroger grocery, selling organics at close to cost, Chief Operating Officer Mike Ellis described the strategy in a recent conference call with investors: “Our customers don’t want to have to pay a premium for natural and organics. And we’re trying to make sure that they can get a good quality product at a price that’s comparable to the nonorganic brands and in some cases actually the same price.”

Is this a winning situation for Davey? Will Whole Foods rebound from their declining store sales as Kroger continues to increase organic revenue? How can you respond with such challenges, say from a cheaper supplement prices from competition?

It’s easy- service, quality and experience.

Think about the core needs of the consumer- or should I say the values that the cultural creative, health driven consumer.

These are the folks with the expendable income; these are the folks who have the willingness to part with their hard earned cash for these core reasons…

Natural wellness via quality nutrition:

  • Brings in better profit margins than most offerings in the pharmacy
    •       Provides monthly refills and resales of products with little to no effort
    •       Brings in a clientele who is healthy minded, willing to spend, and often has a higher income (but ability is not a necessary component as much as willingness is)
    •       Differentiates a practice
    •       Often sells a product that competition resistant- if promoted correctly.

    The natural wellness crowd/baby boomers/cultural creatives want 5 things:

    1.      Trust and transparency- not to be ripped of
    2.      Time saved
    3.      Life made easy
    4.      Alternatives and options
    5.      Quality and Value

Notice…I said value. Not cheapest price. There is a difference, and your customers will pay.

A great example…look at the King of Low Price and Margin cutting sales- Walmart.

Walmarts stock is down over 30% this year since their profits did not meet predictions. That’s profits….NOT SALES. All the while their same store sales are flat, which means, they are selling the same, and taking home even less.

An even better example is Apple. Apple is not a cost cutter- they are an experience enhancer and culture builder. Essentially they sell the same technology as others- but make a heck of a lot more money. There are way more androids on the planet than iPhones, although, the iPhone consumer is the consumer much akin to the cultural creative/wellness crowd I mentioned above. They have the expendable income AND the willingness to spend.

Apple has posted revenues of $51.5bn ($33.7bn) and profits of 31 per cent for Q4 2015, closing the company’s financial year.

Year-on-year, revenues increased by 22 per cent and profits by 31 per cent, driven by ‘record fourth quarter sales of iPhone, the expanded availability of Apple Watch, and all-time records for Mac sales and revenue from services’, according to Apple.

In apples case, profits outpaced revenue…just the opposite of the cost cutting bottom feeder brands.

Before you start thinking “my customer won’t pay for that”- in regards to higher priced supplements, understand that they will. And the more you sell, the more you make, the better you help your customer.

And remember what they are looking for as you incorporate it into your business model:

  1. Trust and transparency- not to be ripped of
    2.      Time saved
    3.      Life made easy
    4.      Alternatives and options
    5.      Quality and Value

What you should take away from the JD Power US Pharmacy Study

Pharmacy Branding on Direction Sign - Green Arrow on a Grey Background.

The landscape of retail pharmacy is getting weirder and weirder, isn’t it? Continued consolidation of the “big corner clones” which further creates a “superpower connection” between government (over-seer’s of our health care industry), PBM’s and Pharma…in my mind, an un-holy trinity of disease state management, cost gauging, and continually failing customer experience.

What about the customer, where do they fit in this equation? What about their levels of satisfaction?

JD Power recently published their annual US Pharmacy Study. Understanding the importance of the consumer experience as being one of the most effective ways to optimize ones marketing practices, this study is designed to provide a framework to help pharmacies define and take advantage of customer satisfaction.

This study looked at 5 Factors:

  1. Prescription ordering
  2. Cost competiveness
  3. In store experience and satisfaction
  4. Pharmacist
  5. Non-pharmacist staff

Where the designated types of pharmacies studied were described as: Major chains, Mass Merchandisers, Supermarkets and Mail order pharmacies, independent minded chains such as Health Mart, Good Neighbor, and Medicine Shoppe should give some good insight for the stand alone independent pharmacy.

The study scored the type of pharmacy categories and came up with a numerical value. Below you will find a brief summation on how each category is trending, as well as examples of stores within the category.

  • Supermarket pharmacy improves from 843 to 851(Wegmens, Publix, H.E.B)
  • Chain drug store pharmacy improves 840 to 842 (good neighbor, health mart and medicine shoppe leading the way)
  • Mailorder drops 822 to 820 (Humana , Kaiser, Express)
  • Mass merchandiser drops 830 to 822 (Target, Sams Club, then Meijer)

I think the fact that chains such as Walgreens and CVS are clumped in with more independent operators including Health Mart, Good Neighbor and Medicine shoppe actually confuses the results, as consumer experiences at the Walgreens, CVS’s and RiteAids of the world don’t generally rank high.

Major Take Homes that Can Start Improving Customer Experience NOW:

  • The study finds that the simple step of asking customers whether they would like to speak with a pharmacist causes overall satisfaction to improve by 54 points.
  • When customers perceive their conversations are handled with discretion and a private area for discussions is provided, satisfaction rises by 99 points.
  • Customers who speak with pharmacists are significantly more likely to purchase other items from the pharmacy and demonstrate high loyalty.
    – 44% of customers who speak with a pharmacist “strongly agree they feel loyal to their pharmacy”
    – Only 35% of those who don’t speak with a pharmacist “feel loyal to their pharmacy”
  • Brick and Mortar – vs – Mailorder on cost savings
    -On Avg. Customers of brick and mortar pay $23 out of pocket per prescription
    – On Avg. Customers of mailorder pay $32 out of pocket per prescription

In Summary:

  • Consumers prefer the independent minded pharmacy
  • Consumers want to speak to the pharmacist over the staff, and will buy more when they do
  • Brick and Mortar actually costs less for the consumer than mailorder




Why Preventative Health…and Not Just Disease Management Has to Be Part of Your Medical Model

Don’t let the Wellness Train leave the station before hopping on…the best time is now.

prague subway station - metro train in motion

Trends in consumer’s habits can tell you exactly where you want your business to be, now and in the future. One area which has been a huge growth category is health and wellness and offers the perfect complement to any medical practice; especially if they desire to strengthen their offerings in preventative and natural medicine.

There have been a few surveys this year which further highlight the consumers desire of getting healthy and staying healthy, and some of the values and desires which they are bringing to the table.

Nielsen published their global health and wellness survey earlier this year which showed congruent trends the worldwide. Worldwide, 50% of consumers surveyed said they had plans on shedding weight, and 75% said they will be adopting healthier habits the year ahead.

Then Alixpartners published their North American Wellness Review, which showed that consumers are willing to spend more on healthy food and healthy habits. This is a growing trend has been going on for a decade and still seems to be only in the early phases, showing no signs of slowing down.

Some take homes from the Review:

  • Health and Wellness categories have been growing 3 to 4 times greater than other grocery items over the past decade.
  • Peoples primary motivation for getting healthy is a “better quality of life”- further highlighting that 59% believe eating healthy is their primary focus, and 54% believing its exercise.
  • Willingness to pay premium prices is up to 8.9% from 6.2% in 2013.
  • “All natural” and “organic” are important buzz words
  • Baby boomers and Millennial’s play a critical role as they both share a very high interest in health and wellness.
  • Baby boomers continue to spend a larger portion of their food and beverage budget on health and wellness.
    -45% spend at least 20% on health and wellness
    – 19% spend more than 40%
    -Food wise they plan on adding more seafood, fiber and vitamins, and eating less red meat, salt and processed food.
  • Millennials plan to add more protein, count calories, and decrease in fast food, while agreeing they seek out more natural and organic.





Vitamin Shoppe Cites Reasons For Growth Challenges

We earlier reported on the reasons for GNC not hitting quarter end goals, and it seems that Vitamin Shoppe has hit similar road blocks, but citing different reasons. GNC many thought, could have taken the easy way out and blamed negative press related to their investigation and “witch hunt” by the New York Attorney General, but instead they identified a cut back in their marketing program as the culprit to their slowed growth.

Colin Watts, The Vitamin Shoppes new CEO, said that  a negative media environment and sluggish supplement innovation are prime contributors to short- and long-term growth challenges for the industry.

While Watts noted internal factors and weather in a progressively worsening first quarter—especially online—that continued into April, he said, “Negative media is probably the major issue we are facing in the short term.”

Watts attributed decreased gross profit to product mix, increased and poorly executed promotional activity, deleverage on store occupancy costs and the impact of Nutri-Force brand line growth/changeover that has led to out-of-stocks and other challenges.

He noted moving “beyond pills and powders” into the broader health and wellness market to poise the supplement seller for growth. Consumer trends are moving away from dieting and to fitness in general, he said, pointing to the growth of fitness trackers as one indicator.


A few lesson here to keep your supplement sales strong:

1) Have a marketing and media program to educate your consumers on any negative press which might come up via media bytes

2) Utilize a nutritional company who constantly brings new, unique formulas into their pipeline which solves unique problems.

3) Have a consistent, multichannel marketing approach in line

4) Think “beyond pills and powder” and understand that the wellness market offers many more opportunities




GNC Disappointing First Quarter Not Due To Negative Media…But Something You Need To Pay Attention To

The message coming from GNC CEO…even in the wake of being attacked by NY Attorney General must be heard by you…if you are looking to continue to grow your nutritional business.

As you probably know, back in early February the news broke in what resembled more of a sting operation; the New York Attorney General (NYAG) tested popular herbal supplements (ex- Echinacea, St Johns Wort, Ginkgo) from four major retailers (GNC, Walmart, Walgreens, and Target)and found that 4 out of 5 classes contained none of the active ingredients listed on the labels.

This led the NYAG to demand that the products be pulled off the shelves of the retailers, and then sent letters to manufacturers demanding results of their testing to back up their claims of quality. The manufacturers were Pharmavite (NatureMade, and now Innate Response and MegaFoods), NBTV (Sundown, Natures Bounty, and Vitamin World), Nature’s Way, Nutraceutical Corp (Herbs for Kids.)

So when GNC announced disappointing quarter end numbers, one would assume he would point fingers at the headlines that highlighted the debacle…but he did not.

“Self-inflicted wounds” contributed to GNC’s disappointing first quarter, CEO Mike Archbold told analysts during the first-quarter earnings call April 30.

Archbold said the company’s analysis of first-quarter declines found the company’s sales challenges arise from changes in its marketing strategy. GNC contacted customers via email and direct mail 33 percent less than during the same time last year. The impact was “more negative than we anticipated,” he said, so the company plans to restore marketing spend previous year’s levels while targeting customer acquisition and doing more with existing clients.

GNC had changed its marketing focus on discount promotions that drove top line sales but not profitability.

“There’s a right way to engage and wrong way to engage,” Archbold said. “Engaging solely on a promotional cadence was the wrong way.”


This folks is a perfect example of how selling the cheapest, offering value only on low price will crush your profit margins, while not even the benefit of gaining enough market share to make a difference. This also shows that cutting back on your marketing, while sending the wrong message will only hurt your company.

What was making GNC grow? Promoting quality, value, and unique solutions to peoples problems, as well as a multi-channel marketing campaign.

If you are not seeing your supplement sales increase…this is exactly where you need to start.

Nestle Getting Into The Gut Game

About a year ago or so, I wrote a blog post about Nestle branching out into the medical food and nutrition realm with Nestle Health Sciences. A few weeks ago, I wrote about C.Diff and the promise that is on the horizon of simulated fecal transplants. Fecal transplants themselves have shown an upwards 90% success rate in treating C. Diff, but the fact of recolonizing your digestive tract with someone elses fecal matter is not the most pleasing thought.

This has led to other companies and projects such as:

Robo-gut and RePOOPulate

You might have heard headlines in the news that spoke about poop pills a year or so ago. In this case researchers have developed a more sanitary way of achieving the same results: synthetic poop.

The researchers created fake feces, aptly named RePOOPulate, after careful examination of bacterial colonies grown from the stool of healthy volunteers. Once the right ratio of species was determined, 33 different bacteria were grown in a robotic intestine simulator affectionately called Robo-gut to create a ‘super-probiotic’ stool substitute. According to the scientists, the bacterial mixture is much more palatable than what it mimics, and smells significantly better. Two patients treated with RePOOPulate showed marked improvement after three days, remaining C. difficile-free months after treatment. Tests of their intestinal flora showed that the fake feces successfully introduced beneficial bacteria to the patients’ guts.

Rebiotix and Seres Health

It seems safe to say that the large scale solution will be coming out of Pharma, as they have the potential to raise the funds needed for clinical trials, and a great upside to gain financially.

In steps Seres Health and Rebiotix. http://sereshealth.com/   http://www.rebiotix.com/

Seres Health is a fairly new (2011) biotech tech company who has raised $ 25 million in their initial round of funding and if you check out their sites, will see that they have a growing pipeline of projects as far as phase III clinical testing.

The Rebiotix program is an enema administered “microbiotia suspension” of tailored microbes grown in a lab.

Well, it looks like Nestle Health Sciences is making a hefty investment to the tune of $65 million dollars in Seres health.

According to Tuesday’s press release from the two companies, Nestle Health Services has completed a $65 million Series D preferred stock investment in Seres. Added to the $48 million Series C round, the company held $110 million in cash and investments at the end of 2014. Other companies with robust funding, including Rebiotix and Nubiota, are studying similar strategies.

Microbiome therapy holds promise for a variety of metabolic and inflammatory diseases but one company executive has described the research as “not for the faint of heart” with an unknown risk/reward equation in the required research. The human microbiome can be described as overwhelmingly complex, with as many as 1,000 different bacteria, numbering in the trillions, interacting with each other and the human body in ways that include gene activation and a noted but poorly understood link to the nervous system.

Source/Read More

So, seeing what’s on the horizon, it looks like options other than fecal transplants might be sooner than many think.

Obviously the best dose is prevention, a maintenance attitude of keeping our digestive tracts in tip top shape, although for those 500,000 dealing with such an issue, there seems to be some broad solutions on the horizon.

Fraudulent Supplement Manufacturer Pleads Guilty

I often tell people that the supplement industry is like the wild wild west…little regulations (not that I am asking for more) thus you have to rely on a quality nutritional company whom looks for third party validation on their quality control, is transparent about their sourcing and manufacturing and will be open about offering you proof, and beware of the hot shot “marketing first, quality last” that seems to be saturating the industry.

One of those “marketing first, quality last” companies is being held to task, as the CEO has plead guilty to fraudulent practices.

The owner and president of a dietary supplement manufacturing company in Flanders, N.J., pleaded guilty to conspiracy to commit wire fraud in relation to a scheme in which he directed the sale of diluted and adulterated dietary ingredients and supplements sold by his company, U.S. Attorney Paul J. Fishman announced.

Barry Steinlight, 69, of Hackettstown, N.J., pleaded guilty to a one-count information charging him with conspiring to commit wire fraud. As part of his plea agreement, Steinlight admitted that Raw Deal’s gross sales during the scheme were between $7 million and $20 million. Steinlight has agreed to forfeit more than $1 million in profits from the scheme.

“Barry Steinlight diluted his products, cheated his customers and lied to the Food and Drug Administration when they came to inspect his company,” said U.S. Attorney Fishman. “This scheme went on for four years and essentially became the business model at his company. People who sell and use dietary supplements have the right to expect that the ingredients are listed and they get what they paid for.”

According to documents filed in this case and statements made in court:

Steinlight was the president and owner of Raw Deal Inc., a dietary supplement manufacturing facility. From at least 2009 through November 2013, Steinlight instructed Raw Deal employees to add “fillers,” including maltodextrin, viobin cocoa replacer and rice flours to the dietary ingredients and supplements packaged for, and sold to, Raw Deal’s customers. These “fillers” were added without customer consent or knowledge. Steinlight also directed Raw Deal employees not to list the “fillers” as ingredients on the certificates of analysis (COAs) issued to its customers as proof of the identity of the ingredients contained in the products.

In addition to directing the dilution and adulteration of Raw Deal’s products, Steinlight also directed Raw Deal employees to create COAs that falsely certified that certain of Raw Deal’s products were kosher or organic. Further during an U.S. Food and Drug Administration (FDA) inspection of Raw Deal in February 2012, Steinlight instructed Raw Deal employees to alter a document before providing it to the FDA.

Source and read more


Is Nature Made Realizing Consumers Are Opting For Specialized Nutrition With This Move

The world of nutrition is a segmented one. From sham supplements that are low quality with deceiving marketing practices, to big box chain, to mid-level herb store brands, to practitioner grade/specialized, highest quality supplements.

At the same time, the nutritional world is changing, more and more people want a piece of the pie, and manufacturers who once played only in one segment, are looking for ways to get into others, especially the area of practitioner grade/specialized, high quality.

I believe this has a lot to do with the consumer getting smarter, looking for transparency in the products they use, and want the best for themselves and their family.

We have seen in recent years, P & G purchase New Chapter, and a big announcement from Pharmavite, the who owns and manufacturers the Nature Made brand, just agreed on a purchase of Food State, Inc.

You might recognize the name Food State from a recent post on what is known as The Transparency Project. Food State owns to nutritional brands, MegaFood and Innate Response, both whole food supplement brands, which is a rising category, thus just for Nature Made to have interest.

MegaFood is more of the high end direct to consumer, with Innate Response is the practitioner focused line, thus the parent company of Nature Made is expanding its category offerings big time. It is the MegaFood brand which they focused the Transparency Project, showing how ones vitamins are made every step of the way. A brilliant move…one for them looking at being bought out, and for Nature Made to invest in such a company whom has begun defining themselves through transparency.

The take home here is that it is apparent what the consumer is looking for, higher quality, specialized and big pharma of vitamins is looking to make their mark.

Looking forward, as I have been doing for years, my money is on high quality supplements for an enduring practice.