The Pharmacist spoke to Ashley Kilgas, chief commercial officer of hub and spoke solution provider Centred Solutions, ahead of incoming changes to hub and spoke legislation that will enable hub and spoke dispensing to operate across legal entities.

Trust between independent pharmacy spokes and centralised hub dispensing will be key to the success of hub and spoke, Ashley Kilgas, chief commercial officer of Centred Solutions, has told The Pharmacist.

Mr Kilgas spoke about three different models of hub and spoke that Centred Solutions has identified and is currently working on:

  • Multiple Entity Hub where pharmacy groups which have previously operated multiple legal entities can now operate a hub and dispense to all the pharmacies within the group regardless of legal entity.
  • Dispensing Service Hub where pharmacies with existing hubs or looking to establish a hub facility can now offer dispensing services to other pharmacies outside of their own legal entity for a fee.
  • And the Co-operative Hub Model where pharmacies can co-operate together and establish a joint ownership hub to supply to their own pharmacies and/or offer a dispensing service to other pharmacies

Mr Kilgas said in the case of the first two models, acting on legal changes to allow hub and spoke dispensing across different legal entities was likely to happen quickly. But he suggested for the co-operative hub model, this ‘will happen’ but it would be ‘a very slow process, because it's going to need a lot of trust in that partnership'.

In an interview with The Pharmacist last month, Mr Kilgas said the changes would help recently acquired groups that are owned by the same person but remain two separate legal entities.

But other independents might be concerned about sharing dispensing information 'with effectively a competitor', and the long-term impacts of entering into relationships with other companies, Mr Kilgas suggested.

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And he said contractors would also have to be able to trust the hub to purchase medicines on their behalf.

'What's that model going to look like in terms of the transparency of pricing?

'If you've got trust in that company, fine, you take the wins with the losses,' he said.

But newer companies and partnerships would take time to build trust, he noted.

The ‘most obvious way’ to build trust would be through setting up a new hub company that would be cooperatively owned by all its members, Mr Kilgas told The Pharmacist.

'Everyone has that skin in the game,' he said.

This could be an opportunity for 'likeminded groups', particularly those that use the same buying system or cascade system, Mr Kilgas said.

Centralising the process of dispensing is where hub and spoke can make the process more efficient, he noted.

'When you move into a hub environment and you transform it to more of a production line, without the interruptions of being in a branch, without patients walking in... rather than everything being done on a patient-by-patient level, you're now doing it by batch of patients and running it through a process very, very efficiently. That's where you really start to reap the benefits,' he said.

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Centred Solutions offer manual and automated hub and spoke solutions. Mr Kilgas said once a hub reaches a certain level of volume it is worth using technology such as an auto labeller.

And he said the solution has been shown to dramatically reduce errors in the dispensing process.

‘We have one customer who installed our hub technology over two years ago. They have dispensed over 4.8 million packs, in that time, there has been zero errors processed by the technology,’ he said.

Any anomalies found by the system are quarantined for the pharmacist to check.

Mr Kilgas also said that a move to hub and spoke dispensing could change the way that some pharmacies purchase stock moving forward.

'There are many customers that shop around for multiple products at multiple prices and prices through cascade systems.

'And I feel there's a myth in that, from my perspective: okay, you may have the cheapest product, but how many deliveries have you had? How many things have you put away, and how many queries have you had on the invoices?

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'Putting it all in one [supplier], paying a little bit more, and not having any of that... it's a very difficult dynamic. And again, it comes to trust.

'What I would say to contractors is, don't dismiss it until you've understood it,' he said.