Pharmacy U

Building the NEW pharmacy


You likely heard of the saying: “Can’t see the forest for the trees”. It relates well to pharmacy’s plight to find its new value proposition and navigate the myriad of changes to Canadian healthcare, and not only to survive, but thrive in an increasingly constrained environment.


By Roderick A. Slavcev, Ph.D., MBA, MRSB, C.Biol.

Before we can properly discuss NuRx, we must step back and get some perspective as NuRx is underpinned by the philosophy “New Pharmacy” that in principle alters the  lens through which we view the profession and its role in the future of Canadian healthcare provision. Not only is the lens crucial, the magnification is equally important to consider. New Pharmacy not only takes a step back to see the forest (pharmacy profession) for the trees (new efficient workflow systems), it takes several steps back to envision a new perspective that sees the globe (healthcare) for its forests (healthcare providers). Thus we shift the value dimension from one of efficient and reliable access to medications to one of effective access to healthcare, and from an inward focus on cost reduction to one of patient/customer satisfaction.

New Pharmacy employs prominent management theory, including world-renowned and practised strategic frameworks, and orients these powerful principles toward the healthcare and pharmacy landscape, thereby leading to the design of new models translating professional skills into realized value. New Pharmacy maintains that the future of healthcare requires the leadership of its many players. It seeks to innovate to provide cost-effective healthcare access to, and create value, at healthcare player interfaces to ultimately benefit patients and confer economically viable and sustainable solutions for healthcare.

In short, New Pharmacy is not driven by the sustainability and profitability of pharmacy, but the utilization of the pharmacy skillset to reform and sustain Canadian healthcare. Before we begin to work on building new efficiencies to reduce cost structure in pharmacy, we must ensure the trajectory is aiming toward an effective goal. There is no shortage of access to medicine among the 10,000+ pharmacies in Canada. All of these generally offer a similar service, thereby commoditizing the offering. Scale is increasingly the driver here to remain competitive in this maturing industry as value is determined by price alone. However, building efficiency and reducing costs is an inward (business)-focused lens that is transactional in nature and neglects to address the real pain points and demands of tomorrow’s patients, half of whom are afflicted with chronic disease(s).

Providing a low-demand service more efficiently is far less valuable to healthcare than one that addresses and fills real access needs, and does so in a way that places a customer/patient at the centre of a full cycle of care. A model that comprehensively customizes and navigates a patient’s “tour” through their disease management is not only good “medicine”, it’s also good business as it focuses on a market with strong growth, raises customer switching costs, differentiates the business, and represents a premium offering that increases customer value and subsequently, business margins.

We recently designed a model to demonstrate how value is created in healthcare, which demonstrates the various dimensions of value shaped as a pyramid representing the diminishing suppliers at each incremental tier until the pinnacle. Retail pharmacy in its current embodiment dwells within the bottom two value levels — either a series of transactions offering similar service(s), or a bundle of undifferentiated services and/or products comprising a “supply push” of offerings by the healthcare professional to the patient/customer. The top two tiers, on the other hand, look through a new objective focusing primarily on patients/customers and co-creating value with them. Now that the foundation of New Pharmacy has been laid we are ready to take another step back and see the world for its forests.


Roderick A. Slavcev, Ph.D., MBA, MRSB, C.Biol. is ‎Associate Professor, Pharmaceutical Sciences, & Professor of Business and Entrepreneurship, ‎University of Waterloo