Maximizing Pharmacy Revenue

November 2023 |

When Los Gatos Dog & Cat Hospital started turning down phone and fax prescription requests, monthly pharmacy revenue increased by double digits.

In 2021, Los Gatos Dog & Cat Hospital in Los Gatos, Calif., decided to take control of its pharmacy, a move that had positive results for the practice’s team—and its bottom line.

The policy change started in June with an email to the practice’s 5,000-plus clients letting them know that the practice would no longer be approving prescription requests via phone or fax as of August 1.

The practice’s business administrator, Jaymi Cleland, and practice manager, Sandi Broeland, RVT—the duo who spearheaded the change in policy—waited for the fallout. Luckily, it never came. In fact, the transition streamlined workload for their team and substantially increased revenue.

Why change

The new policy came about because the sheer volume of prescriptions was overwhelming. “Nearly 75% of the prescription requests we received were from outside pharmacies, and it was preventing our staff from providing actual patient care and interacting with clients,” Broeland recalls. “We staff our pharmacy and lab with a technician every day, and they were spending four to five hours each shift dealing with these requests. We can’t afford to pay our staff to work for outside pharmacies.”

Preparing for the transition

As a first step, the team got buy-in from the pharmacy staff who handled most of these requests. Then they let clients know why they were making a change. Broeland explains: “We made it very clear that they could get their prescriptions from whatever source they chose, but their options were to get it from us directly, order it from our online pharmacy or pick up a written prescription and send it to their pharmacy of choice.”

In the meantime, every time the practice received a prescription request from an outside pharmacy, the client received a notification reminding them of when the new policy was going into effect. The team also contacted the major online pharmacies to let them know they would be ending their relationship with them. “In some cases that took a few phone calls for the outside pharmacies to accept the change and stop sending requests,” says Cleland.

Putting the plan in motion

On August 1, the practice started declining the faxes that were coming through from Chewy or 1-800-Pet-Meds, and then followed up with an automatic email to the clients reminding them of the new policy and providing a link to the medication on the practice’s own pharmacy. “We only had a handful of clients call with questions or concerns, and those were easily handled by our pharmacy staff or reception team. To our knowledge, we didn’t lose a single client over the policy change,” says Cleland.

Building the bottom line

The financial benefits were substantial. For the first 12 months, the practice saw a 58% increase in online pharmacy revenue. That represents $12,000 to $13,000 a month, which is about $67,000 or $68,000 in profit annually from the practice’s pharmacy alone.

Compliance has improved, too. “When we were approving prescriptions for outside pharmacies, we had no way of knowing whether that prescription was actually filled. But when it’s ordered through our pharmacy, we know when the product was shipped and received,” says Cleland.

Get started: Take control of your pharmacy

Making the pharmacy policy change was much easier than Cleland and Broeland expected, so their advice to other practices is simple: Just do it!

  • Make sure the team is on board with the switch and engaged in the process.
  • Let clients know ahead of time when—and why—the switch will occur.
  • Prepare a response for the team to answer any client questions.

Learn more about pharmacy and prescription issues, including more information on managing pet prescription choices from the AVMA.