Making the Business Case for Telepharmacy

Mitch Larson

Pharmacists are the most accessible healthcare providers for most Americans. Pharmacies are a place where patients can talk with a trusted and knowledgeable professional about a variety of health questions and concerns. This is the warm and fuzzy side of things, the side that might easily be depicted through video montages of smiling patients chatting pleasantly with pharmacists in white coats. 

Unfortunately for some of today’s pharmacies, if there was a video depicting the financial side of the business, it would be quite different. Instead of warm and fuzzy with a side of smiles, the vibe might resemble one of those cheesy political smear ads. You know the vibe - dark, ominous, and featuring lots of poorly designed graphics of plummeting charts.

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This is why it is so important for pharmacies to find ways to strengthen their businesses. You can’t provide the warm and fuzzy if the business isn’t financially stable. A primary reason pharmacists pursue telepharmacy is because of the positive impact it can have on their business both in terms of increasing patient access and improving financial stability. 

Let’s start by discussing some of the ways telepharmacy makes good business sense for some pharmacies, and then we’ll get into more details about what makes a telepharmacy implementation successful.

When Telepharmacy Makes Business Sense

Why do pharmacists decide to pursue telepharmacy for their practice? While the specifics of their situation will vary, it is common that pharmacists want to accomplish one or more of the following:

  • They want to grow their patient base without incurring prohibitive costs associated with traditional pharmacy expansion.
  • They want to reach an underserved community that needs pharmacy services, but doing so via traditional pharmacy would be detrimental to the business.
  • They want to keep a struggling location in operation and make it financially viable.

Telepharmacy allows savvy pharmacy owners to accomplish these goals, however it should be noted that telepharmacy is not intended to be a replacement for traditional pharmacies. There are several ways a pharmacy owner may implement telepharmacy to supplement the services they already provide in order to bolster their business.

Let’s get into more detail on what generally makes for a successful implementation of telepharmacy that positively impacts the pharmacy business.

Two Scenarios: New Sites and Conversions

There are two ways to go about opening a telepharmacy location. A new telepharmacy site is a brand new location where a pharmacy did not exist before, whereas a conversion site is a traditional pharmacy that is transitioned into a telepharmacy.

New Sites

New telepharmacy sites are typically pursued when there is a relatively small or untapped market for a pharmacy to expand into. This could be an area where a pharmacy recently closed, or a community that has never had a pharmacy, but has demand for pharmacy access from the local population (more on this point later). Additionally, practice sites such as clinics and mental health facilities have looked to telepharmacy to provide convenient access at the point of care. 

New sites are a great opportunity to simply provide services in areas that couldn’t be reached before, or in some cases, telepharmacy serves as an opportunity to test out a new market. In new markets telepharmacy enables the pharmacist to grow their patient base for later conversion to a traditional pharmacy with a pharmacist on site full time. Starting small with a low-cost telepharmacy can be a great way to get a pharmacy’s foot in the door of a community or new practice site to build up business.


Conversions can sometimes sound scary to outsiders. Many people hear “conversion” and automatically their knees bend and their fists clench as they prepare to brawl over the value of a pharmacist and how telepharmacy kills jobs. Don’t worry - we completely agree with you on the value of the pharmacist, and we have absolutely no intention of killing pharmacist jobs. Conversions are recommended and pursued when the pharmacy’s alternative is to shut down. 

As many pharmacists know, there are not very many aspects of a pharmacy’s expenses that pharmacists can control. With declining reimbursement rates and increasing drug costs, there is only so much that can be done to impact the profitability of a pharmacy. By converting a struggling (or a failing) pharmacy to a telepharmacy, pharmacists are able to take control of labor costs and make the location more financially solvent while retaining convenient pharmacy access for the community. This keeps the valuable pharmacist-patient relationship intact and also provides future opportunities for the pharmacist to come on-site for immunizations and other clinical activities.

The Winning Formula

While one-size-fits-all solutions don’t truly exist in the world of business, when it comes to telepharmacy, there is a pretty accurate formula for what will ultimately work well for a new telepharmacy location.

Whether it’s a new site or a conversion, there is a “sweet spot” for both population and prescription volume that serves as a successful combination for a telepharmacy. If the numbers are too low, there may not be enough to sustain even a telepharmacy location. If the numbers are too high, then potentially pursuing a full traditional pharmacy would be a better route. 

Whether the telepharmacy is a standalone location or located inside of a clinic, the necessary prescription volume will vary. It’s best to analyze the target prescription volume on a case-by-case basis to ensure an accurate assessment of how many prescriptions a telepharmacy should aim to process per day, and what will be attainable for the location. Our team is best able to help you perform this prescription volume analysis.

When it comes to population, this also varies greatly depending on the scenario. Generally speaking, the population of a community being served by a telepharmacy should be at least 750 people. This could be a small rural town, or perhaps an urban neighborhood with a high percentage of elderly or low-income households. If there is a clinic in the community, this is always a good sign, as people are already accessing some healthcare services in their own community, and chances are good they’ll not only be receptive to a pharmacy, but the clinic would also be excited to have accessible pharmacy services available to the patients as well.

Is Telepharmacy Right for Your Practice?

As a pharmacist or pharmacy owner, you are the expert on your business and surrounding community. If you have locations in mind that you feel would be a good fit for telepharmacy, our telepharmacy business consultants can help you explore those possibilities. Talk to people in the community including the city council and the local clinic, and figure out if there’s an opportunity to work together to expand your business while providing convenient pharmacy access. Telepharmacy is always a win-win.

Keep in mind that telepharmacy is not permitted in every state, so check if your state allows the practice. If you’d like to consult with a telepharmacy business consultant about possibly pursuing telepharmacy, get in touch.

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