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By Mel Duvall  |  Posted 2005-05-04 Print this article Print

Big companies think automated mail-order pharmacies like Medco help cure rising drug costs. That remedy won't make retail giants like Walgreens and CVS feel better.

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The engine for that growth chugs away at the Willingboro pharmacy, Medco's newest and largest facility, located about a 30-minute drive north of Philadelphia. The facility could hold about seven football fields, and is home base for 1,200 employees, including 140 full-time pharmacists, who work three shifts a day, six days a week.

The company operates nine mail-order and five call-center pharmacies, some of which handle highly specialized drugs that may require refrigeration or delicate handling. However, the bulk of its orders are filled at two automated pharmacies, one in Las Vegas, which began operations in 1997, and the other in Willingboro, which opened in August 2001.

Chief information officer Mark Halloran says the Pharmacy of the Future, as the Las Vegas facility was called, involved a multipronged information systems development effort. Not only did new software need to be developed to run the automated plant, but a new system had to be devised to accept and process prescriptions in high volumes.

Medco's 700 in-house software engineers tackled the development effort, says Halloran, because there was no off-the-shelf offering available and Medco wanted to protect the technology.

The first piece of the puzzle is what Medco calls its Alpha system—essentially a platform for accepting and processing prescriptions before they are passed on to a pharmacy to be dispensed—which was completed in 1999. The Alpha system is a client-server application, meaning desktop computers communicate directly with specific servers. The system was built using Microsoft's Visual Basic programming language and replaced a mainframe Cobol application.

Clients submit prescription orders to Medco in four primary ways: mail, fax, automated voice response (phone) and the Medco.com Web site.

If an order is submitted by automated voice response or online, a Medco pharmacist will contact the client's doctor and confirm the patient is eligible for the medication. With the client's complete medication history stored in Medco's Teradata warehouse, the pharmacist can also confirm how long the client has been taking a medication and whether there may be any conflicts.

When Medco signs on a new customer, such as United Airlines, it performs a data dump—essentially receiving a transfer of the medication history for the company's employees from the employer itself or from its previous pharmacy benefit manager.

Medco employs 2,000 pharmacists, typically based at call centers in Tampa; Dublin and Columbus, Ohio; Irving, Texas; and Las Vegas, to perform this task.

Once a Medco pharmacist approves a prescription, internally developed router software determines where to have it filled. The program takes into account a number of variables, Halloran says, including the client's proximity to the Las Vegas or Willingboro pharmacies, the current availability of the required drugs, workloads at the pharmacies and shipping costs.

Once it determines the most efficient and cost-effective fulfillment method, the router passes a production order on to the company's Pharmacy Automation Control system. The PAC is the brains behind the Las Vegas and Willingboro facilities, telling machines exactly what drugs to put into which bottles and what instructions to pack in the envelopes, then coordinating the printing of labels for bottles and shipping envelopes.

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PAC was also programmed in-house, but was built off a base application originally developed by BAE Systems to control aircraft manufacturing operations. Drug dispensing and aircraft manufacturing seem very different, but Halloran says they share a basic similarity. "Both start with raw materials in one door and finished products out the other," he says. "The primary benefit [to using the BAE software] is that it employed a system of checks and balances at every stage of the manufacturing process, which we also needed to incorporate into our processes."

This becomes clear at Willingboro when you consider how the large hoppers, or counting cells, are loaded with individual drugs. The pharmacy receives medication—say, Lipitor, Wellbutrin or Prozac—in large bottles containing from 3,000 to 11,000 pills apiece. When directed by PAC, a pharmacist must load the counting cells with the pills. The counting cells are in a series of five rows, and PAC will allow only one pharmacist in a row at a time to fill a cell to prevent the possibility of the wrong drug ending up in the wrong cell.

The pharmacist who approaches a cell must enter a security code, then scans a bar code on the bottle and on the hopper to ensure there is a match. A sample of the pill in the bottle is compared with a pill sample in a small compartment on the hopper. When the checks are completed, the pharmacist has three seconds to begin filling the hopper with pills. The three-second check is designed to prevent the pharmacist from mistakenly setting a bottle down and picking up a different bottle in error. After filling the hopper, another scan takes place to confirm the drug is correct before the new pills are released into production.

Seven different checks are required, says Jim Flynn, Medco's business development manager, and this process for refilling the hoppers may be repeated up to 4,000 times a day. The hoppers are connected to the bottle-filling machines by vacuum tubes, and no human hands will touch the drugs until they arrive at a customer's door.

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Contributing Editor
Mel Duvall is a veteran business and technology journalist, having written for a variety of daily newspapers and magazines for 17 years. Most recently he was the Business Commerce Editor for Interactive Week, and previously served as a senior business writer for The Financial Post.

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