Case Study

Equality Health Group's On-site Pharmacy Achieved ROI Breakeven in Under 12 Weeks

August, 2024

Founded In

2020

Entity Type

STD Clinic

Location

Oklahoma City, OK

Employees

13

Contract Pharmacies

12

On-Site Pharmacy

1

When Gilead decided to take away the 340B funds from their copay cards, that almost killed our business.

Cody Turpin

CEO, Equality Health Group

Problem

Cody Turpin launched Equality Health Group (EHG) in the middle of COVID lockdown in 2020, at a time when the State of Oklahoma had redirected all its contact tracing resources away from STD programs to the pandemic. His own experience navigating the healthcare system earlier that year had left much to be desired when it came to stigma surrounding certain health conditions and how it translated to poor bedside manners. He decided to launch EHG with the sole purpose of taking care of the most ignored, hardest to serve patients and treating them right while doing so.

As the number of patients grew, sustaining the business became difficult which is counterintuitive to how the safety net programs are supposed to work. EHG had to take a step back, slow their patient intake down even as demand grew and assess their business. It became clear that manufacturer restrictions, and the changing PBM and regulatory landscape could lead to pricing and reimbursement volatility. Further, the net proceeds from contract pharmacy after their fees had the potential to run EHG out of business, or at best, leave little margin to meaningfully invest back into growing the business and advance their public health mission.

There was also the problem of capture rate and medication adherence when working with their contract pharmacy, which reduced the topline further (size of the pie). In EHG’s case, working with a pharmacy that was in an entirely different state meant that the care team were in the dark once the prescription had left the clinic. They often found that their patients had to navigate complex situations leading to delays with critical medications, adversely impacting disease progression.

"When you provide a patient with this awesome care at the clinic, tell them we are going to take care of them - and 3 days later, they have heard no updates on their prescription, that is a terrible, terrible feeling.” - Cody, speaking of his experience with his primary contract pharmacy  

Opportunity

At Alchemy, we believe safety net providers have three imperatives. It starts with the choice to rapidly build & launch a pharmacy within the four walls of their health center - what we call the ‘physical layer’ of our in-house pharmacy program. But to truly meet the moment, safety net providers need to look beyond the four walls of their pharmacy to meet patients where they are, and deploy a ‘clinical layer’ and ‘digital layer’ that removes all barriers to access, and not just stabilizes, but helps grow their 340B program for the future.

When Cody approached us in early 2023, it was immediately evident that the Alchemy model could address his concerns about sustaining and growing the business. We partnered with EHG to start with the physical layer by building out and operationalizing the in-house pharmacy first, to take control of the existing book of business and get to predictable financials. The digital layer kicked in once we were fully in network and operational. This enabled the pharmacy team to tightly coordinate with the clinicians, make data driven decisions and reach patients at the right time with the right medication removing all barriers to access.

Simultaneously, our clinical team worked with Cody to design a clinical program that was most suitable for their community and would enable EHG to identify, treat and retain net-new patients. Together we launched a mobile clinic conducting HIV and Hepatitis C (HCV) rapid testing, and linking positive patients to confirmatory testing and treatment at the clinic. The mobile clinic program focuses exclusively on serving People who Inject Drugs (PWID), by meeting them where they are: rehab centers, methadone clinics and plasma centers across the state. And while safety net clinics like EHG primarily reach women and minority communities, the mobile clinic is bringing in new patient populations - white, heterosexual men - most affected by the opioid epidemic.

Results

Over the past 12 months since we built and began operating EHG’s in-house pharmacy, we have tracked several operational, financial and clinical data points. The results speak for themselves.

Operational

  • Time to in-network with 99% PBMs - 9 weeks from BoP license issuance
  • First prescription dispensed - 9 weeks from BoP license issuance
  • Steady state volume with 95%+ capture rate - 3 months from BoP license

Financial

  • Time to break even / ROI - 12 weeks from first dispense
  • Revenue uptick from existing Rx volume - 25 - 30%
  • Overall growth in pharmacy revenue - 130-140%
  • Pharmacy Operating Margin - averages 46% monthly

Clinical

  • “Having the pharmacy here in the clinic is definitely weight lifted off my shoulders” - EHG patient
  • Patient Adherence - 95%
  • New patient intake from mobile clinic program - 190+ high-risk PWID tested with an 18% test positivity rate; nearly 20 times the national average

With the in-house pharmacy driving adherence for existing patients, EHG is not only able to further expand its topline (size of the pie) but also double down on the public health mandate of their 340B program. They’ve increased their rate of new patient intake and are reaching new at-risk populations. For example, while HVC positivity rates of testing done at the clinic is consistent with the national average (1.1%), the mobile clinic is finding hot spots where test positivity is north of 20%. A full 71% of confirmed HepC positive patients are identified via EHG’s community outreach partnerships.

EHG’s success emulates the flywheel Alchemy is setting out to create for every one of our customers. It is one of Alchemy’s core values to protect the safety net for providers who deliver care to the most vulnerable and underserved communities and we remain steadfast in this mission.

van

Alchemy deployed a mobile clinic for EHG to acquire new Hep C patients.