Supporting Innovation in Pharmacy for a Healthier Canada

The Business of Value

December 2014 - “If you don’t create value, you don’t matter.” That single sentence, delivered by Dr. Roderick Slavcev during his presentation at the Canadian Foundation for Pharmacy’s recent Pharmacy Forum, sums up one of the biggest challenges faced by community pharmacists today. Until patients and payers can put their finger on what pharmacists and only pharmacists can do for them, pharmacy will continue to be a profession with tremendous potential value, “but very little of it realized,” said Slavcev, Assistant Professor at the School of Pharmacy, University of Waterloo.

Value can be different things to different people. “In a commodity market, the focus is on costs and there is value in that for some customers,” he noted. However, “the only competitive platform is price” and to succeed the business “needs to be huge in scale.”

The second approach is to create value through differentiation, so that “what you’re doing is so unique that customers are willing to pay more,” said Slavcev. The focus is not on the product but “what can you do for your patient. You are selling experiences, not products. This is where pharmacy desperately needs to go, not only for its sake but for the sake of health care.”

The challenge with differentiation, however, is financial sustainability. “A business model underpins everything,” stressed Slavcev, who teaches a course in business administration and management. Quality assurance is an essential component, he added, because “success will be built upon your reputation.”