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Empowering the with Greg Janes, MBA

June 2017 Disclosures

Cardinal has a commercial interest in telepharmacy, but does not reference any commercial products in this presentation. The opinions and recommendations expressed by the presenter are their own, and are to be used for educational purposes only. Why telepharmacy?

1. Utilize technology to improve 2. Enable access to a pharmacist in rural communities 3. Increase pharmacist outreach in urban areas The four types of telepharmacy

INPATIENT OUTPATIENT

Remote order Retail entry review telepharmacy

Remote IV admixture counseling Need for alternative delivery

Independent Rural 2003-2013

7,624 924 independent rural pharmacies closed 12.1 % decrease 490 2007-2009 rural communities lost their only 7.2% 6,700 decrease

Source: Update: Independently Owned Pharmacy Closures in Rural America, 2003-2013; RUPRI Center for Rural Analysis, Rural Policy Brief June 2014; Fred Ullrich, BA; Keith J. Mueller, PhD Telepharmacy historical timeline

1942 Australia’s Royal Flying Service

2001 North Dakota first state to allow 2001 Association in Spokane, WA launches program

2002 NDSU study begins 2003 Alaska Native Medical Center program 2006 U.S. Navy begins telepharmacy North Dakota telepharmacy case study

Study conducted from 2002 - 2008 dispensing

error rate for Information of the North telepharmacies Dakota Telepharmacy Program provided by North Dakota State University School of 81 Pharmacy telepharmacies <1% Compared to a national average of: ~1.7 %

Result: Positive outcomes, mechanisms could be improved

Source: The North Dakota Experience: Achieving High-Performance Through Rural Innovation And Cooperation. May 2008 North Dakota telepharmacy case study

Information of the North Dakota Telepharmacy Program provided by North Dakota State University School of Pharmacy

Source: The North Dakota Experience: Achieving High-Performance Health Care Through Rural Innovation And Cooperation. May 2008 Telepharmacy regulations, 2008

Source: Telepharmacy project expands across country; 9/12/2008; Dave Kolpack, Associated Press Telepharmacy regulations, 2016

Source: Quarles & Brady LLP analysis & report, July 2016 Why telepharmacy?

1. Utilize technology to improve patient adherence 2. Enable access to a pharmacist in rural communities 3. Increase pharmacist outreach in urban areas How big is the adherence problem?

187M 13% Americans take $290 billion 1+ prescriptions healthcare expenses directly related to non-adherence avoidable costs

Sources: Osterberg, L., Blaschke, T. (2005). Adherence to medication. N Engl J Med, 353(5), 487-497; Thinking Outside the Pillbox, A System-wide Approach to Improving Patient Medication Adherence for Chronic ; A NEHI Research Brief – August 2009 “The Leaky Bucket”

According to IMS Health:

Out of every 50-70 48-66 25-30 15-20 are 100 new arrive at a are picked up are taken refilled as prescriptions pharmacy by the patient properly prescribed

Source: IMS Health Data, March 2011 Frequent interactions with

Patients visit their pharmacist more than any other healthcare provider

Provider # visits 4 Other healthcare providers 9 Pharmacist 35

Source: as Influencers of Patient Adherence, August 21, 2014, Joseph Moose, PharmD, and Ashley Branham, PharmD, BCACP Patients desire convenience

95% patients filled initial prescriptions when offered at doctor’s office

Source: New Prescription Medication Gaps: A Comprehensive Measure of Adherence to New Prescriptions; Harvard Business Review Vol 44 | Num 5 | Oct 2009. Why telepharmacy?

1. Utilize technology to improve patient adherence 2. Enable access to a pharmacist in rural communities 3. Increase pharmacist outreach in urban areas Definition of rural

According to HRSA:

“Rural” encompasses all population, housing, and territory not included within an urban area.

Source: https://www.hrsa.gov/ruralhealth/aboutus/definition.html Rural is becoming more rural

19.3% 77%

of total population lives rural counties considered in rural areas shortage areas

Source: The Crisis in Rural Primary Care; WWAMI Rural Health Research Center, Policy Brief April 2009 2010 Census Urban and Rural Classification and Urban Area Criteria, https://www.census.gov/geo/reference/ua/urban-rural-2010.html Creating patient relationships

“Telepharmacy helps create a new patient-pharmacist relationship that wasn’t possible before.”

- Angela Falk, Pharm.D. Rural telepharmacy next to a health Interior of a rural telepharmacy Rural community pharmacy grand opening

Shoshone Telepharmacy, December 2016 Rural telepharmacy revives Main Street

BEFORE

AFTER of telepharmacy

NORTH DAKOTA ILLINOIS Results of the 6-year study with Estimate for one pharmacy based 81 locations: on financial data:

$26.5 million $640,000 in economic development annual economic impact

80-100 new jobs created

Source: North Dakota Telepharmacy Project https://www.ndsu.edu/telepharmacy/; Rural Economic Technical Assistance Center (RETAC) in Macomb, IL; Economic impacts of a pharmacy for Deiterich, Illinois, June 2015 Why telepharmacy?

1. Utilize technology to improve patient adherence 2. Enable access to a pharmacist in rural communities 3. Increase pharmacist outreach in urban areas Access challenges in urban areas

University of Illinois Chicago did a study looking at “pharmacy deserts” in Chicago:

Over one million residents live in 1+ miles these areas in Chicago

to nearest pharmacy

Source: Source: ‘Pharmacy Deserts’ Are Prevalent In Chicago’s Predominantly Minority Communities, Raising Medication Access Concerns, Dima M. Qato, Martha L. Daviglus, Jocelyn Wilder, Todd Lee, Danya Qato and Bruce Lambert. Patients desire convenient access

75% patients would prefer to fill prescriptions where they see their doctor if given the choice

Source: Patient Attitudes toward Point-of-Care Medication Dispensing in a Primary Care Office Setting. July 19-22, 2007 by Opinion Research Corporation on behalf of Purkinje. www.purkinje.com. Readmission rates are high

A study in Oregon found that readmission rates were higher in rural areas than urban, but both are still high:

15.3% 14.7% Rural Urban

Source: Lack of pharmacy access sends some patients back to the ; Oregon State University and Oregon Health & Science University, August 2016 Better Education + Better Access Better Outcomes Pediatric hospital telepharmacy Telepharmacy in a community health center In-clinic pharmacy providing 340B Telepharmacy in a FQHC Common Questions Software solutions

Advantages

• Live pharmacist interaction • Constant updates • Low initial costs • Better education

Disadvantages

• Can be limited hours • Live internet connection Hardware or AMDS solutions

Advantages • Can be available 24 hours • No on-site staff needed

Disadvantages • Cost-prohibitive • Limited formulary • Mechanical failure • Complicated Telepharmacy workflow

New prescription arrives at 1 Pharmacy A

A B Technician A fills, taking images 2 of the process

Pharmacist B reviews images 3 to verify fill is accurate

Rx Tech RPh Tech Patient picks up Rx at Pharmacy A and 4 Pharmacist B counsels Endless opportunities

Workload balancing

Pharmacy Accessible deserts specialists FAQ

Safety Fill Accuracy (staff & location)

Internet Diversion outage Regulatory Considerations Telepharmacy regulations, 2016

Source: Quarles & Brady LLP analysis & report, July 2016 Regulations are fragmented

• Different for each type of telepharmacy

• Vary widely by state

• Practice setting

• Verification site location

• Urban allowances

States that have telepharmacy language can benefit from aligning their rules NABP currently has a task force to create model language Indiana House Bill 1540 (Telepharmacy)

(3) Be located at least ten (10) miles from an existing retail pharmacy unless:

(A) the applicant with the proposed remote dispensing facility demonstrates to the board how the proposed remote dispensing facility will promote ; or

(B) the pharmacy located less than ten (10) miles from the remote dispensing facility is part of a hospital or a physician clinic setting.

A qualifying pharmacist may have this designation for only one (1) supervising pharmacy and for one (1) remote dispensing facility at a time.

There must be at least one (1) pharmacist working at a remote dispensing facility for every six (6) pharmacist interns, licensed https://iga.in.gov/legislative/2017/bills/house/1540#digest-heading https://iga.in.gov/legislative/2017/bills/house/154pharmacy technicians,0#document-69db09e3 and pharmacy technicians in training at the supervising pharmacy and remote dispensing facility Indiana Statistics

60 pharmacy deserts

56k+ underserved patients

99 at-risk communities

233 cities with no pharmacy Why telepharmacy?

1.Utilize technology to improve patient adherence 2.Enable access to a pharmacist in rural communities 3.Increase pharmacist outreach in urban areas Questions? Greg Janes, MBA [email protected] (319) 774-1628

For updates and more information, visit telepharm.com/learn Typical regulations

Pharmacy technician certification • Hours and/or years of experience Limits on number of remote sites or technicians

Special rules around Controls

Mileage restrictions

Security requirements

Technology requirements

Signage in the telepharmacy location Telepharmacy regulation considerations

Need is increasing every year

• Physician Dispensing • Mail order

Successful programs already in place

Consider the present as well as the future

Get ahead of the technology and legislators

• Don't include technology requirements Steps to implementing regulations

Look for statutory authority 1 • If no statutory authority, must engage legislature

2 Have Board Rules Committee draft rules

3 Board notices rules to the public

4 Public comment period

5 Administrative rules review process & approval

6 Implementation Tips to drafting regulations

Look into what other states have for regulation

Visit a retail telepharmacy location which is in operation

Understand the landscape in your state

Ensure statutes leave room for administrative rules