Unlock a £250k Valuation Boost for Your Pharmacy with PillTime's Hub & Spoke MDS Solution
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With 71%*of pharmacies currently operating at full MDS fulfilment capacity, and many making a net loss of approximately £10 per patient per month when servicing MDS patients, the third-party Hub & Spoke model could transform pharmacy valuations by converting a loss-making service into a profitable revenue stream.
We all know the current environment for community pharmacies is challenging, with rising costs, capacity constraints, and increasing pressure to deliver more services. In particular, fulfilling the needs of patients using monitored dosage systems (MDS) has become a significant burden.
Despite the financial strain, pharmacists often feel obligated to support MDS patients, especially when referrals come from GPs, and out of concern for losing not just one patient, but potentially an entire family's prescription revenue.
PillTime aims to relieve this pressure by centralising the fulfilment of MDS through the third-party Hub & Spoke model. Pharmacies would outsource their MDS requirements to PillTime to manage all aspects of dispensing and packaging using their cutting-edge pouching technology. Pharmacies surveyed by C+D in October 2024, see that this arrangement would allow them to scale up their MDS services—potentially increasing their patient base by 50%*—without adding to the workload of their existing teams.
By following the example set in countries like the Netherlands and Sweden, where centralised MDS fulfilment is the norm, the current challenge could become an opportunity for community pharmacies to grow.
Consider a typical scenario: a pharmacy currently servicing 100 MDS patients and experiencing an annual loss could, by partnering with PillTime, turn that loss into an additional £70,000 in revenue. This could lead to an EBITDA increase, potentially raising the pharmacy’s valuation by £250,000 or more. Even if the pharmacy decides not to pass on the full pouch fee to all patients, this approach can still drive a six-figure uplift in store value.
Additional benefits:
- Reduce labour costs associated with MDS dispensing and reallocate resources and space to other revenue-generating services, such as private treatments or pharmacy first services.
- The system’s low error rates, and good audit histories present lower risk to potential buyers.
- High levels of customer satisfaction and strong patient relationships can significantly boost a pharmacy's valuation.
- Exclusivity in offering local pouch services, along with value-added items like vitamins, not only enhances convenience for patients but also creates a unique value proposition.
- By improving the accuracy and efficiency of MDS, we help reduce the burden on GPs, hospitals, and other healthcare providers.
By becoming a member of PillTime’s Hub services, community pharmacies will have access to a range of benefits, including geographic exclusivity, marketing materials, training and operational support. PillTime partners will retain their NHS reimbursement and dispensing fees while gaining transparency over their drug margins, as the cost of each item is clearly laid out. The proposed fee for the service is £20 per patient per month (the partner has discretion over whether they will pass the fee on to some or all patients).
PillTime is poised to begin supplying Spoke pharmacies as soon as the necessary legislation passes. With around 13,000 pharmacies seeking to enhance their profitability and expand their service offerings, we see tremendous potential for our PillTime Hub & Spoke solution to make a meaningful impact in the community pharmacy landscape. Given the anticipated demand for our services, we will likely have limited capacity, so we encourage you to register your interest now, and visit www.pilltime.co.uk/hub-and-spoke to discover how much your pharmacy valuation could increase
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