Latest / Pharmacy Podcast Network / Inventory, AI and Automation, R&D Tax Credits, Peptides, and Basis | The Bottom Line Rewind

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Inventory, AI and Automation, R&D Tax Credits, Peptides, and Basis | The Bottom Line Rewind · Pharmacy Podcast Network

• 0:05
  Speaker 1: You are listening to the global network of podcasters dedicated
• 0:09
  Speaker 1: to the pharmacy profession.
• 0:10
  Speaker 2: Welcome to the Pharmacy Podcast Network.
• 0:32
  Speaker 3: Welcome back to the Bottom Line Rewind, the show that
• 0:35
  Speaker 3: shares all the best moments from this past month on
• 0:38
  Speaker 3: the Bottom Line Pharmacy Podcast. This month, we've got four
• 0:42
  Speaker 3: interviews lined up on inventory, AI, R & D tax credits,
• 0:46
  Speaker 3: and peptides. Plus, we're bringing you an exclusive interview that
• 0:50
  Speaker 3: talks about understanding basis when buying a pharmacy. If you
• 0:53
  Speaker 3: want to check out the full conversation, you can find
• 0:56
  Speaker 3: the links to each of these interviews in the description
• 0:58
  Speaker 3: of this episode.
• 0:59
  Speaker 4: Check them out.
• 1:03
  Speaker 3: First up is a segment from our interview on inventory
• 1:07
  Speaker 3: management in 2026 featuring Jared Barton, the CEO of Inventory IQ.
• 1:13
  Speaker 3: We talk about what perpetual inventory actually means and why
• 1:16
  Speaker 3: most pharmacies aren't as dialed in as they think.
• 1:20
  Speaker 2: Here's that moment.
• 1:21
  Speaker 4: We always ask you this question, you know, what percentage
• 1:24
  Speaker 4: of our pharmacies out there in general are on perpetual systems?
• 1:28
  Speaker 4: And I think we're always at 50% or 40%. Are
• 1:33
  Speaker 4: we any better now?
• 1:35
  Speaker 2: Better, right? It depends. Maybe it's recency bias, but it depends.
• 1:41
  Speaker 2: My answer largely depends on who I talked to last
• 1:44
  Speaker 2: week when I talked to you guys. I just think
• 1:49
  Speaker 2: that we've got such a loose interpretation of perpetual inventory
• 1:54
  Speaker 2: throughout the industry that when I think perpetual, I want
• 1:57
  Speaker 2: it to be Counts are updated, going and coming. Orders
• 2:01
  Speaker 2: are going out of the system and coming back into
• 2:03
  Speaker 2: the system. And then when I ask people that question, hey,
• 2:07
  Speaker 2: are you using Perpetual or are you not? They're like, oh, yeah,
• 2:09
  Speaker 2: we're on Perpetual. And then I have to get like
• 2:11
  Speaker 2: three questions deep to derive that, oh, well, we're keeping
• 2:15
  Speaker 2: up with our counts. We're not sending our orders this way.
• 2:18
  Speaker 2: We're kind of receiving them, but not for these wholesalers.
• 2:21
  Speaker 5: I feel like most new clients that we work with
• 2:24
  Speaker 5: almost all say, oh, yeah, we got Perpetual, but maybe
• 2:27
  Speaker 5: it's not. fully the way it should be, full perpetual.
• 2:31
  Speaker 5: But they're not counting on December 31st anymore.
• 2:35
  Speaker 2: I don't... Yeah, that's... So I would say across.
• 2:40
  Speaker 1: I.
• 2:41
  Speaker 2: Would say across the.
• 2:44
  Speaker 2: Yeah, we're quasi-perpetual. But I would say across the industry,
• 2:49
  Speaker 2: we're getting a little better. People are recognizing the need
• 2:53
  Speaker 2: to have that transparency and data for decision-making because we're either...
• 2:58
  Speaker 2: by necessity, um, or by default realizing that that's 80%
• 3:03
  Speaker 2: of our spend for the year. And so if we're
• 3:05
  Speaker 2: going to measure a number, that's probably a good one
• 3:07
  Speaker 2: to measure, you know, where we can capture four fifths
• 3:10
  Speaker 2: of the business. But, um, I don't know. I feel
• 3:14
  Speaker 2: like there's a lot of people that are cherry picking
• 3:16
  Speaker 2: parts of that process because it's the way we've always
• 3:19
  Speaker 2: done it, or it's a little easier to do it
• 3:21
  Speaker 2: this way. And so I don't, I still think we're
• 3:24
  Speaker 2: in that one out of two, four out of 10 range. Um,
• 3:28
  Speaker 2: fully perpetual could tell you right now what the inventory is.
• 3:32
  Speaker 2: And then accuracy is the next question.
• 3:34
  Speaker 4: I had a new client come on board. Their turns
• 3:39
  Speaker 4: were four.
• 3:40
  Speaker 2: All right. So my number is.
• 3:41
  Speaker 6: 1-800-253- So we had a big old conversation about that.
• 3:50
  Speaker 4: And well, I don't know if I did or not,
• 3:53
  Speaker 4: but if things don't get better at that, that conversation will.
• 3:58
  Speaker 3: So Jared, when it comes to implementing perpetual inventory, are
• 4:03
  Speaker 3: you noticing how AI can kind of help with that
• 4:07
  Speaker 3: process in a pharmacy a little bit more? I don't
• 4:11
  Speaker 3: know if you've been using AI to help with perpetual
• 4:14
  Speaker 3: inventory implementation or whatnot.
• 4:16
  Speaker 2: So one thing that we've started doing over the last
• 4:18
  Speaker 2: couple of years, this is twofold benefit to the customer,
• 4:22
  Speaker 2: is essentially we have divorced our analysis from the time
• 4:27
  Speaker 2: of the count. And that's important because it makes the
• 4:30
  Speaker 2: count take less time, makes the analysis take less time. Together,
• 4:35
  Speaker 2: that process takes about 80% of the time that it
• 4:37
  Speaker 2: took us to do a full overhaul perpetual inventory for
• 4:41
  Speaker 2: a customer four or five years ago. So we've cut
• 4:44
  Speaker 2: that some in terms of efficiency. What it impacts that
• 4:49
  Speaker 2: doesn't show any kind of total time is that that
• 4:51
  Speaker 2: count getting in in half the time that it used
• 4:54
  Speaker 2: to take means that the count's more accurate and the
• 4:57
  Speaker 2: customer's able to utilize that 50% more quickly, right? So
• 5:03
  Speaker 2: leaves less margin for error, counts are more accurate. The
• 5:06
  Speaker 2: analysis piece takes less time because somebody specializes doing that
• 5:13
  Speaker 2: in a controlled environment where they're not interrupted in the pharmacy,
• 5:15
  Speaker 2: be that conversation with technician, conversation with pharmacist, phone call,
• 5:19
  Speaker 2: different things like that. What's going to happen on that
• 5:22
  Speaker 2: is I'm I don't know how much more quickly we
• 5:26
  Speaker 2: can get the count portion because that's the physical portion
• 5:28
  Speaker 2: and Elon hasn't gotten there with robots yet.
• 5:31
  Speaker 7: Right.
• 5:32
  Speaker 2: So I don't know. And even if he did tomorrow,
• 5:36
  Speaker 2: I don't know that we'd be able to trust the
• 5:38
  Speaker 2: dexterity there not to crush or destroy product and get
• 5:41
  Speaker 2: it right and things like that. I think it'll be
• 5:43
  Speaker 2: a while before that type of robotics reaches the independent
• 5:46
  Speaker 2: pharmacy market. It'll reach the chain market, Amazon, Walmart, things
• 5:51
  Speaker 2: like that first. because those are the people that do
• 5:53
  Speaker 2: stuff like that. What it will do is it'll continue
• 5:57
  Speaker 2: to cut our time and improve our accuracy on the
• 6:00
  Speaker 2: analysis side. And then what we'll be able to do
• 6:03
  Speaker 2: is shorten the window for how often we can do that,
• 6:06
  Speaker 2: which brings seasonal trends and more proactive approach to order
• 6:10
  Speaker 2: points into the mix, which is our focus for the
• 6:13
  Speaker 2: next six to 12.
• 6:15
  Speaker 4: It'll come to a daily point where you're doing it daily.
• 6:18
  Speaker 1: Yeah.
• 6:19
  Speaker 8: Or you could. Exactly.
• 6:21
  Speaker 7: Yeah. Exactly.
• 6:22
  Speaker 2: And so some products you don't want to identify for
• 6:27
  Speaker 2: a daily, right? Because then if you're talking about low
• 6:29
  Speaker 2: enough for your order points, you're talking about these massive
• 6:31
  Speaker 2: gyrations and stocking the product, not stocking the product. But
• 6:34
  Speaker 2: your fast moving products that demand shifts on largely, especially seasonally, cough, cold, flu, vaccine,
• 6:42
  Speaker 2: stuff like that. You're really talking about getting extremely tight
• 6:45
  Speaker 2: with stocking those.
• 6:48
  Speaker 5: So some of the times that we see you know, inventory,
• 6:50
  Speaker 5: people that have perpetual systems, some of our clients that
• 6:53
  Speaker 5: they seem to get out of whack a little bit.
• 6:55
  Speaker 5: What we ended up figuring out is they haven't updated
• 6:57
  Speaker 5: the pricing correctly or they're not keeping those, the pricing,
• 7:00
  Speaker 5: or there's a pricing error in there.
• 7:02
  Speaker 1: So what is, I.
• 7:02
  Speaker 5: Don't know if this makes sense, but what's the best way,
• 7:06
  Speaker 5: like the people that, your high performers, the ones that
• 7:08
  Speaker 5: really have their things up to date and what are
• 7:11
  Speaker 5: they doing that some are not doing?
• 7:13
  Speaker 1: Like what are the steps.
• 7:16
  Speaker 5: To ensure the best system.
• 7:19
  Speaker 2: Don't get too cute with it. And I know that's
• 7:21
  Speaker 2: a very like Southern euphemism way to say it. So
• 7:30
  Speaker 2: the people that we see that have the least pricing
• 7:32
  Speaker 2: errors are typically ordering majority of their drugs. And this
• 7:35
  Speaker 2: is individual to your mix, your script mix, your payer mix,
• 7:38
  Speaker 2: all that good stuff. And we could talk. We could
• 7:42
  Speaker 2: talk primary vendors versus a gazillion secondary market all day long.
• 7:47
  Speaker 2: You know, we play in that arena in two separate entities.
• 7:51
  Speaker 2: So we could really get in the weeds on that.
• 7:54
  Speaker 2: But those folks that have the least pricing errors, and
• 7:56
  Speaker 2: this will sound goofy in light of Amerisource's little stumble
• 8:01
  Speaker 2: a month and a half ago, but they typically order
• 8:03
  Speaker 2: the majority of their drugs from one large, well-established wholesaler
• 8:06
  Speaker 2: that has extremely tight EDI constraints that's lined out. And
• 8:12
  Speaker 2: then maybe they supplement that for out of stocks or
• 8:17
  Speaker 2: something that's hard to get or something where their primary
• 8:19
  Speaker 2: is just out of line with a couple or a
• 8:23
  Speaker 2: handful of secondary wholesalers that are large enough to support
• 8:28
  Speaker 2: EDI transmission. And the common thread there is just EDI
• 8:33
  Speaker 2: transmission of orders back to the pharmacy so you can
• 8:35
  Speaker 2: receive them into your pharmacy management system. I know it
• 8:38
  Speaker 2: can be extremely attractive. There's a couple of small secondaries
• 8:42
  Speaker 2: on the market right now that are giving people pricing
• 8:45
  Speaker 2: that they don't understand. I know that because they're telling
• 8:47
  Speaker 2: me on the phone, they're selling it to me for this.
• 8:49
  Speaker 2: And I'm like, that seems like a problem. That seems
• 8:51
  Speaker 2: like a red flag to me, you know, in a
• 8:54
  Speaker 2: world of, we'd love to call things red flags. I'm like, yeah,
• 8:57
  Speaker 2: that's probably a problem. We don't know yet. I'm not
• 9:03
  Speaker 2: calling it disingenuous or above or below the law. above
• 9:07
  Speaker 2: or below board. But ultimately, if that secondary won't facilitate
• 9:12
  Speaker 2: EDI transmission back, especially in a pharmacy that's moving volume,
• 9:16
  Speaker 2: that's going to cause some sort of workflow breakdown at
• 9:19
  Speaker 2: some point. Nobody's perfect.
• 9:22
  Speaker 5: And for someone who has a decent average perpetual system
• 9:27
  Speaker 5: working pretty well, what do you see as a necessary
• 9:32
  Speaker 5: timeframe for that a physical count should still be done.
• 9:36
  Speaker 5: Have you guys come in and do a good count
• 9:38
  Speaker 5: and make sure everything's on the up and up.
• 9:41
  Speaker 4: Yeah.
• 9:41
  Speaker 2: So there's a trick trick question. Um, because I think
• 9:46
  Speaker 2: that you need to do it at least once a year.
• 9:48
  Speaker 8: I understand.
• 9:49
  Speaker 2: I have a vested interest in that because like, Hey,
• 9:51
  Speaker 2: we share some customers, a lot of the folks in
• 9:54
  Speaker 2: the industry, if they have it counted once a year,
• 9:56
  Speaker 2: I'm at least in the running to count it, you know? So,
• 10:00
  Speaker 2: I get that a lot of it also depends on
• 10:04
  Speaker 2: how often are you often are you looking over and
• 10:06
  Speaker 2: what's your cycle count procedure you know so if you
• 10:10
  Speaker 2: had a robust cycle count procedure I could understand going
• 10:14
  Speaker 2: a little longer than that, especially if in your cycle
• 10:17
  Speaker 2: counts you're using the tool to dictate accuracy and you're
• 10:21
  Speaker 2: not just blindly changing things and going, oh, well, we
• 10:24
  Speaker 2: got close. But if you're cycle counting stuff and it's
• 10:27
  Speaker 2: spot on, spot on, spot on, and you don't have
• 10:29
  Speaker 2: a lot of negative inventory items in the system, you
• 10:32
  Speaker 2: make it go a little longer than that. But I
• 10:35
  Speaker 2: don't find that to be the case with most people.
• 10:38
  Speaker 4: What does a robust cycle count process look like, Jared?
• 10:41
  Speaker 2: I would like to count through the inventory at the
• 10:45
  Speaker 2: bare minimum. Average drugstore, you can have 1,500 NDCs on
• 10:48
  Speaker 2: the shelf over the course of time. That's roughly 150
• 10:53
  Speaker 2: a month, something like that, 125 a month. If you
• 10:57
  Speaker 2: break that to 22 working days, count like five to
• 11:00
  Speaker 2: seven products a day. I don't feel like that's a
• 11:04
  Speaker 2: huge lift to count that many items. C2s maybe a
• 11:09
  Speaker 2: little more often than that, maybe quarterly. Um, the drug
• 11:13
  Speaker 2: stores that I get to choose how much they do,
• 11:16
  Speaker 2: where we had an owner come to us and go, Hey,
• 11:18
  Speaker 2: I can't micromanage this. I want you to micromanage it.
• 11:21
  Speaker 2: I haven't counted quarterly. And they stay more accurate.
• 11:27
  Speaker 3: Next up is an interview from inside a pharmacy bot
• 11:30
  Speaker 3: featuring Ross Miller, VP of sales at TJM labs. They're
• 11:34
  Speaker 3: talking about what a pharmacy AI bot actually is and
• 11:37
  Speaker 3: automation ideas beyond data entry.
• 11:40
  Speaker 4: Here's that. And I guess a low hanging fruit that
• 11:44
  Speaker 4: I see clients kind of going and talking with you
• 11:49
  Speaker 4: guys is literally from a data entry standpoint. And when
• 11:53
  Speaker 4: that prescriptions coming into the door at the pharmacy to
• 11:57
  Speaker 4: getting it into the script system, processing it and so forth.
• 12:02
  Speaker 4: I know that's a key area you guys focus on
• 12:04
  Speaker 4: among many others, I'm sure. But I guess walk us
• 12:08
  Speaker 4: through like what TGAM Labs kind of focuses on and
• 12:14
  Speaker 4: where those kind of low hanging fruit areas are for
• 12:19
  Speaker 4: pharmacies in terms of automating kind of that front end
• 12:22
  Speaker 4: process or maybe even beyond that for the pharmacies.
• 12:28
  Speaker 1: Yeah, I think you sort of hit the nail on
• 12:29
  Speaker 1: the head, right? Our moat and the reason we exist
• 12:33
  Speaker 1: is to automate mundane, tedious, repeatable tasks in the pharmacy.
• 12:38
  Speaker 1: To your point, the easiest way to sort of wrap
• 12:41
  Speaker 1: your head around how to get started, like what's the
• 12:44
  Speaker 1: floor for this type of experience? It's data entry. That
• 12:48
  Speaker 1: is the biggest pain point that we see across pharmacies today, right?
• 12:53
  Speaker 1: I can't find techs, my best tech left. I spoke
• 12:57
  Speaker 1: to someone, I think in the last couple of weeks,
• 12:59
  Speaker 1: who said I lost four techs all the same time
• 13:01
  Speaker 1: during holiday season. Like that is a super painful proposition
• 13:05
  Speaker 1: for a pharmacy. And the pharmacy owner, folks who don't
• 13:09
  Speaker 1: want to actually be involved with this end up sort
• 13:11
  Speaker 1: of taking on the burden, you know, or they had
• 13:15
  Speaker 1: right aid closures down the street, right? And they took
• 13:18
  Speaker 1: on all this additional volume. It's really hard to find
• 13:21
  Speaker 1: good people. And I think COVID has sort of push
• 13:25
  Speaker 1: some of this as well. Like there's been a lot
• 13:27
  Speaker 1: of techs that just left the industry and never came back.
• 13:30
  Speaker 1: And we don't think they're ever going to come back
• 13:33
  Speaker 1: like the way they probably were in the past. So
• 13:36
  Speaker 1: we're really sort of at the point now we're automating
• 13:39
  Speaker 1: over half a million prescriptions every single day. We went
• 13:43
  Speaker 1: from about 30 pharmacy groups last summer when I started
• 13:45
  Speaker 1: to over 500 today. We believe this is, yeah, this isn't,
• 13:51
  Speaker 1: this is no longer futuristic. This is an in-practice. I
• 13:55
  Speaker 1: know you guys know Encore, RX Automation. Kyle's now our COO.
• 13:59
  Speaker 1: He's driving our retail business. We acquired Pharmasol, a voice
• 14:03
  Speaker 1: AI company to focus on inbound and outbound calls. So
• 14:08
  Speaker 1: we're really at the tipping point of what this looks
• 14:12
  Speaker 1: like in practice. It's super exciting. And Scotty, to your point,
• 14:16
  Speaker 1: there's all sorts of other things we can do. We
• 14:18
  Speaker 1: have groups that are automating billings. invoicing, shipping, again, helping
• 14:26
  Speaker 1: with making referral requests on the phone. We have people
• 14:30
  Speaker 1: asking about how do we handle ordering and inventory, like
• 14:33
  Speaker 1: all these other pain points that customers are surfacing. We're
• 14:37
  Speaker 1: now figuring out ways to build automation to support that,
• 14:40
  Speaker 1: to answer your question.
• 14:41
  Speaker 2: Yeah, that's awesome.
• 14:43
  Speaker 5: So in plain English for some of our listeners who
• 14:46
  Speaker 5: haven't even jumped into the world of AI yet, so
• 14:49
  Speaker 5: they're a little... So to adapt, what exactly, just in
• 14:54
  Speaker 5: a summary form, would that look like? What are you
• 14:56
  Speaker 5: guys doing exactly?
• 14:58
  Speaker 1: Yeah, look, I think AI can be scary. Let's call
• 15:02
  Speaker 1: it like it is. People look at this kind of
• 15:04
  Speaker 1: thing and they say, it's coming from my job. I
• 15:08
  Speaker 1: would actually argue that we're up-leveling and sort of giving
• 15:12
  Speaker 1: people the ability to be more valuable in their business.
• 15:15
  Speaker 1: And what we're really doing, so you understand who we
• 15:18
  Speaker 1: are and how we've gotten here, is we're a company
• 15:21
  Speaker 1: of almost entirely pharmacists and engineers. Our founder, pharmacist and engineer.
• 15:26
  Speaker 1: Kyle from Encore, pharmacist and engineer. Natalie from PharmaSol is
• 15:31
  Speaker 1: a pharmacist. Her co-founder is an MIT engineer. We have
• 15:35
  Speaker 1: an executive leadership team that comes from pharmacy, understands pharmacy,
• 15:39
  Speaker 1: and understands how to automate. So really, I would say
• 15:42
  Speaker 1: what we're doing is we're building, we call them digital workers, right?
• 15:46
  Speaker 1: And they're there to supplement and sort of improve upon
• 15:49
  Speaker 1: what's happening in the pharmacy. And honestly, we would much
• 15:53
  Speaker 1: rather see people that are doing more value-added things in
• 15:56
  Speaker 1: the pharmacy. Like we want our folks in the compounding
• 15:59
  Speaker 1: lab mixing drugs. We want our people focused on wellness clinics,
• 16:05
  Speaker 1: on LTC at home, on patient outreach, patient care. And
• 16:10
  Speaker 1: we are there, again, to take care of the things
• 16:12
  Speaker 1: that you probably don't want to be paying people to do.
• 16:15
  Speaker 7: To begin with. Right.
• 16:17
  Speaker 4: Yeah, that data entry is, and you know, those mundane
• 16:22
  Speaker 4: repeatable tasks are things that certainly, you know, you want
• 16:26
  Speaker 4: your high value trained professionals not maybe doing that. You
• 16:30
  Speaker 4: want them going out and talking to Miss Jean about,
• 16:34
  Speaker 4: you know, some supplements to help her ailment or whatever
• 16:38
  Speaker 4: it is. So, you know, there's, it opens the door
• 16:40
  Speaker 4: for those future revenue opportunities that many pharmacies are trying
• 16:44
  Speaker 4: to get into trying to find what fits in their area.
• 16:48
  Speaker 4: And that automation piece can help lessen that burden of
• 16:54
  Speaker 4: the increase in cost, the time, more employees, things like
• 16:59
  Speaker 4: that to do that.
• 17:00
  Speaker 5: And Scotty, I mean, it just makes me think, you know,
• 17:02
  Speaker 5: we're having these same conversations on our side, on the accounting.
• 17:06
  Speaker 5: You could have inserted everything you just said has changed
• 17:08
  Speaker 5: pharmacy to accounting. I mean, those mundane tasks, that data entry,
• 17:13
  Speaker 5: Anything that you can take, we're really pushing our staff
• 17:15
  Speaker 5: to do the same because we want to use them
• 17:17
  Speaker 5: in other areas. Like you said, just lift them up
• 17:20
  Speaker 5: to do other more important tasks. So this is all
• 17:23
  Speaker 5: over the board.
• 17:24
  Speaker 1: All industries.
• 17:26
  Speaker 8: Yeah, absolutely.
• 17:27
  Speaker 3: And Ross, one thing that you said that I think
• 17:30
  Speaker 3: I kind of want to dive into a little bit
• 17:32
  Speaker 3: more is you've got the data entry piece that AI
• 17:36
  Speaker 3: can cover, but you said there's a lot more that
• 17:38
  Speaker 3: it can do. And I feel like a lot of
• 17:41
  Speaker 3: pharmacy owners that are just starting to implement AI. They're
• 17:46
  Speaker 3: using it for that data entry piece, but I know
• 17:48
  Speaker 3: that PJM Labs has a whole suite of things that
• 17:51
  Speaker 3: it can cover from how it works with providers and
• 17:55
  Speaker 3: stuff like that. So talk a little bit more about
• 17:58
  Speaker 3: what's the world of opportunity with AI outside of just
• 18:04
  Speaker 3: data entry and some of those mundane tasks.
• 18:07
  Speaker 1: Yeah, I mean, to be honest, I don't really know
• 18:09
  Speaker 1: what it looks like, you know, six months online, a
• 18:12
  Speaker 1: year from online, because the world is changing so fast, right?
• 18:15
  Speaker 1: We usually build because our customers tell us this would
• 18:20
  Speaker 1: be super impactful, right? So you brought up a really
• 18:22
  Speaker 1: good point, Austin. We were being asked by every PK customer,
• 18:28
  Speaker 1: Pioneer customer, Liberty customer, you know, all these compounders, Have
• 18:33
  Speaker 1: you solved for, you know, how do we capture clean
• 18:36
  Speaker 1: prescriptions into the pharmacy? Do you know a provider portal
• 18:40
  Speaker 1: that's out there?
• 18:41
  Speaker 4: Right.
• 18:41
  Speaker 1: And there were a couple out there. And I think
• 18:43
  Speaker 1: we sort of got tired of just referring folks to
• 18:46
  Speaker 1: the two existing ones. So our founder decided to kind
• 18:49
  Speaker 1: of build his own provider portal.
• 18:50
  Speaker 2: Right.
• 18:51
  Speaker 1: So we now offer a provider portal. Again, some pharmacy
• 18:54
  Speaker 1: management systems have their own portal attached to it already,
• 18:57
  Speaker 1: but most don't. Um, and, and, you know, it's super
• 19:00
  Speaker 1: painful when a prescriber will write a prescription into a
• 19:03
  Speaker 1: pharmacy and has nothing to do with what they actually
• 19:05
  Speaker 1: fill in the, in the, in the pharmacy.
• 19:07
  Speaker 3: Right.
• 19:08
  Speaker 1: So the provider portal basically gives a one click catalog
• 19:11
  Speaker 1: essentially to say, here's what I actually have that I
• 19:13
  Speaker 1: can prescribe. And it then brings clean data into the PMS.
• 19:17
  Speaker 1: And there's not all this back and forth faxes, phone calls. Hey,
• 19:21
  Speaker 1: we actually don't do it like this. Here's, here's what
• 19:23
  Speaker 1: we do do. So. We've seen a lot of really
• 19:26
  Speaker 1: good early returns with the provider portal. I think we
• 19:28
  Speaker 1: have about 40, maybe 50 customers using it today. And
• 19:32
  Speaker 1: we actually just talked about internally today, launching a vaccination
• 19:36
  Speaker 1: bot because vaccination season's coming and there are pharmacies out
• 19:41
  Speaker 1: there that do 80% of their volume off of vaccines,
• 19:44
  Speaker 1: They have clinics that they serve. They have different groups
• 19:49
  Speaker 1: that come in and basically rely on the pharmacy just
• 19:52
  Speaker 1: to get all their shots updated for the season. So
• 19:57
  Speaker 1: we're working on that right now. There's going to be
• 20:00
  Speaker 1: other things. There's like this whole thought, this whole sort
• 20:03
  Speaker 1: of process around meds. what is it, MedRec, MedReconciliation, I
• 20:09
  Speaker 1: think is what it is, where a pharmacist has to
• 20:12
  Speaker 1: go in once a month and compare two charts between
• 20:15
  Speaker 1: the months and it's hours and hours and hours of
• 20:18
  Speaker 1: just pharmacist time. Well, now we have a bot that
• 20:21
  Speaker 1: sort of takes care of that process because one of
• 20:23
  Speaker 1: our partners said, hey, can you build a bot to
• 20:25
  Speaker 1: help me do this thing? So we always are hearing
• 20:29
  Speaker 1: what's next, what would be helpful from our customers.
• 20:33
  Speaker 3: I think I heard this on a podcast somewhere, but
• 20:37
  Speaker 3: it sounds like you guys have just a word doc
• 20:40
  Speaker 3: of just ideas that are written down, like these are
• 20:43
  Speaker 3: the things that we want to do or the ideas
• 20:46
  Speaker 3: that we've thought of. So that's really cool that you
• 20:48
  Speaker 3: guys are getting that ingrained with pharmacy where you're hearing
• 20:52
  Speaker 3: what people are wanting and you're kind of doing the
• 20:56
  Speaker 3: build-a-bot situation, which is really cool.
• 20:59
  Speaker 1: You guys know this world, right? Everybody in the pharmacy space,
• 21:02
  Speaker 1: they like to talk. Everyone knows each other. There's Facebook groups.
• 21:06
  Speaker 1: There's like, I don't know, as a salesperson, it's different
• 21:09
  Speaker 1: because things are happening behind closed doors. And sometimes we
• 21:12
  Speaker 1: don't have the ability to find everything out. But, you know,
• 21:15
  Speaker 1: when you get champions and customers that want to help
• 21:18
  Speaker 1: you and they're advocates, you learn a lot about sort
• 21:21
  Speaker 1: of what makes people tick and what their friends might
• 21:23
  Speaker 1: want to do, right?
• 21:25
  Speaker 8: Yeah, absolutely.
• 21:27
  Speaker 3: So you mentioned That kind of build a bot, I guess,
• 21:30
  Speaker 3: kind of structure. Walk us through, I guess, the anatomy
• 21:34
  Speaker 3: of an AI bot if a pharmacy owner is getting
• 21:36
  Speaker 3: this kind of integrated in their system. So a pharmacy owner,
• 21:41
  Speaker 3: I guess, they contact you guys, they have a specific problem.
• 21:46
  Speaker 3: How exactly does that AI bot work? Walk us through
• 21:50
  Speaker 3: just the anatomy of it.
• 21:52
  Speaker 1: Yeah, it's changed a lot since we made these acquisitions, Austin.
• 21:56
  Speaker 1: Like when I first started, everything for TGM Labs was custom, right?
• 22:00
  Speaker 1: So if you came to me as a compounding pharmacy owner,
• 22:03
  Speaker 1: as a retail pharmacy owner, LTC, specialty, whatever, we would
• 22:07
  Speaker 1: sort of treat that as a custom situation. You're like,
• 22:10
  Speaker 1: here's the implementation fee, here's the subscription fee, we're gonna
• 22:13
  Speaker 1: give you a pharmacist, we're gonna give you an engineer,
• 22:15
  Speaker 1: and we're gonna build this to your specifications, right? that
• 22:20
  Speaker 1: doesn't work as you scale really fast, right? There's backlogs,
• 22:23
  Speaker 1: there's how much headcount can we use this month to
• 22:27
  Speaker 1: take on this number of implementations. But what we've taken from,
• 22:31
  Speaker 1: I would say specifically the Encore Rx automation acquisition is
• 22:36
  Speaker 1: Kyle built basically a bot in a box, right? For
• 22:39
  Speaker 1: retail pharmacies, here's a retail bot. It's gonna do your
• 22:43
  Speaker 1: priority fill queue, it's gonna do your cycle fills, it
• 22:46
  Speaker 1: will short fill, And it's basically, here's this thing. We're
• 22:51
  Speaker 1: going to plug it in. It's going to be off
• 22:53
  Speaker 1: and running, right? So we have sort of transitioned our
• 22:56
  Speaker 1: own business model to be a little bit more nimble
• 23:00
  Speaker 1: and say, here's the solution for you. Like it's been
• 23:04
  Speaker 1: a little bit more prescriptive than it was before. So
• 23:08
  Speaker 1: to answer your question, if we get somebody who's a
• 23:10
  Speaker 1: retail owner on Pioneer and now we're doing on Liberty
• 23:14
  Speaker 1: as well, We're going to say, here's a product for
• 23:16
  Speaker 1: you and here's how it works and here's what it does.
• 23:18
  Speaker 1: But if you come to us as a compounder who's
• 23:21
  Speaker 1: doing things, you know, sort of across the board and
• 23:25
  Speaker 1: have a million different business rules and everything truly needs
• 23:28
  Speaker 1: to be custom, we'll sell you a bot that can
• 23:30
  Speaker 1: do that. So it's really, there are different options now,
• 23:34
  Speaker 1: whereas in the past it was sort of a one
• 23:36
  Speaker 1: size fits all.
• 23:37
  Speaker 3: Our third interview is actually a clip from the bottom
• 23:40
  Speaker 3: line catch up. featuring Scotty Sykes, Bonnie Bond, and Austin
• 23:43
  Speaker 3: Murray over at Sykes & Company. They're talking about updates
• 23:46
  Speaker 3: to the R & D tax credit documentation.
• 23:49
  Speaker 8: Here it is.
• 23:50
  Speaker 3: Talk about the R & D update, Scotty. You said
• 23:51
  Speaker 3: there's a new one, something new with the documentation or whatever?
• 23:55
  Speaker 4: Yeah, we do a lot of R & D tax credits,
• 23:57
  Speaker 4: and the IRS has been postponing for a few years
• 24:05
  Speaker 4: now the enhanced reporting that you have to do on the,
• 24:10
  Speaker 4: Form 6765, which is the tax credit, R & D
• 24:13
  Speaker 4: tax credit form. And essentially what you're going to have
• 24:16
  Speaker 4: to do now for 26 and beyond is you have
• 24:23
  Speaker 4: to list each individual business component. So a prescription would
• 24:28
  Speaker 4: be a business component. So if you're doing hundreds of
• 24:32
  Speaker 4: R & D prescriptions, even though you may be spending
• 24:34
  Speaker 4: 10 to 30 minutes on them, you know, those add
• 24:38
  Speaker 4: up over the course of a year, right? So you
• 24:40
  Speaker 4: may be dealing with hundreds of them and there, you
• 24:45
  Speaker 4: need to be, you know, identifying these prescriptions, um, and
• 24:50
  Speaker 4: being prepared to, um, provide these prescriptions and the process
• 25:00
  Speaker 4: of experimentation, who worked on it, um, What the uncertainty was,
• 25:05
  Speaker 4: you need to be able to provide that documentation. Documentation
• 25:09
  Speaker 4: is everything. Documentation is so key here with R &
• 25:13
  Speaker 4: D from this year going forward. It's always been very,
• 25:17
  Speaker 4: very important. If you don't have it, you're not getting credit.
• 25:19
  Speaker 4: But now you're going to have to actually put some
• 25:22
  Speaker 4: of this documentation on the form itself, which has never
• 25:26
  Speaker 4: been a requirement until now. So you're actually pretty much...
• 25:31
  Speaker 4: doing the audit for the IRS when you're completing the
• 25:35
  Speaker 4: form now.
• 25:36
  Speaker 5: Which is a brilliant idea for the IRS.
• 25:39
  Speaker 2: So if you ever get.
• 25:40
  Speaker 1: Audited, they will pull the file.
• 25:43
  Speaker 4: That being said, there might be an exemption of some
• 25:46
  Speaker 4: sort where you may not have to put a thousand
• 25:48
  Speaker 4: of them on there, maybe 50, or if you're below
• 25:51
  Speaker 4: a threshold or something. So there's waiting to hear some
• 25:54
  Speaker 4: more guidance on if there's going to be a threshold
• 25:57
  Speaker 4: or a minimal requirement, but either way, The documentation piece
• 26:02
  Speaker 4: is definitely getting enhanced with the reporting and it's more
• 26:07
  Speaker 4: important than ever.
• 26:09
  Speaker 3: So for someone like me who, you know, I don't
• 26:13
  Speaker 3: compound prescriptions, obviously, but, you know, if I'm getting into,
• 26:19
  Speaker 3: if I'm doing R & D documentation, you know, what
• 26:22
  Speaker 3: does that look like now? So does that mean that
• 26:25
  Speaker 3: I have to document every single prescription and, you know,
• 26:29
  Speaker 3: What's included in that? What does it look like now,
• 26:33
  Speaker 3: the documentation?
• 26:34
  Speaker 4: So I tell everybody that, and we're trying to build
• 26:39
  Speaker 4: something for pharmacy owners to capture this documentation, but in
• 26:46
  Speaker 4: real time, but essentially you need to be able to
• 26:48
  Speaker 4: identify the prescription, put who's working on it, who worked
• 26:52
  Speaker 4: on it, how long they worked on it, 15 minutes,
• 26:55
  Speaker 4: 30 minutes, an hour, whatever. What the uncertainty was, like
• 27:01
  Speaker 4: what were you solving for that you weren't sure about?
• 27:04
  Speaker 4: And then what experimentation.
• 27:07
  Speaker 2: Process did you use?
• 27:08
  Speaker 4: You know, we used two tablespoons of alcohol instead of
• 27:13
  Speaker 4: one tablespoon to make the cream or whatever. And then
• 27:16
  Speaker 4: that didn't work, so we changed it. So just a
• 27:19
  Speaker 4: couple sentences on the uncertainty and experimentation is going to
• 27:23
  Speaker 4: be good documentation. And that shouldn't take a pharmacy long,
• 27:27
  Speaker 4: a pharmacist or your staff long. It's not intended to
• 27:33
  Speaker 4: be a major burden on the business. So, you know,
• 27:41
  Speaker 4: for example, if I'm an auditor and I go into
• 27:43
  Speaker 4: a pharmacy and ask for the documentation and I have
• 27:47
  Speaker 4: 200 prescriptions that have been identified, a quick list of
• 27:51
  Speaker 4: who worked on them, one or two sentences on the
• 27:55
  Speaker 4: experimentation and the uncertainty, I'm, as an auditor, I'm going,
• 27:58
  Speaker 4: all right, these guys have a pretty good lid on this.
• 28:01
  Speaker 4: So you're not going to.
• 28:04
  Speaker 5: I think that the biggest thing is, is being able to,
• 28:06
  Speaker 5: cause you're going to have, you know, cross of employees
• 28:09
  Speaker 5: that work doing regular things and then they're doing the
• 28:11
  Speaker 5: new things. And so you, you, that's probably the hardest
• 28:14
  Speaker 5: part documenting what you're doing and the changes you're making
• 28:16
  Speaker 5: and what makes it different and new. You can do that,
• 28:19
  Speaker 5: but then you have to start and really try to
• 28:20
  Speaker 5: allocate their time. like how much time they spend from
• 28:25
  Speaker 5: their whole week versus what goes towards that and what goes,
• 28:28
  Speaker 5: you know, because it's a full calculation of that. It
• 28:31
  Speaker 5: is burdensome to a certain.
• 28:33
  Speaker 4: Oh, it is burdensome, but it's not.
• 28:35
  Speaker 5: Intended to be.
• 28:36
  Speaker 4: Intended to be, so you don't want to go overboard
• 28:38
  Speaker 4: with it. But, you know, it is. But, you know,
• 28:44
  Speaker 4: to take it seriously, you need to.
• 28:45
  Speaker 8: Be at $ 150, 000 to $ 200, 000 of wages.
• 28:50
  Speaker 4: Um, R and D wages. So it's like a pharmacist
• 28:52
  Speaker 4: and a tech, you know, something like that. Um, that's,
• 28:56
  Speaker 4: you know, you could say is, uh, involved in R
• 28:59
  Speaker 4: and D. So it's gotta be a good amount of,
• 29:02
  Speaker 4: of R and D work going on.
• 29:04
  Speaker 1: And it's gotta be new.
• 29:06
  Speaker 5: It's gotta be new stuff.
• 29:07
  Speaker 3: Next up a clip from peptide policy and PBMs featuring Dr.
• 29:11
  Speaker 3: Annie West clinical pharmacy director at atrium 24 and daily
• 29:16
  Speaker 3: PBM and pharmacy practice group co-chair Dr. at Buchanan, Ingersoll,
• 29:21
  Speaker 3: and Rooney PC. They're talking about the recent PCAC meeting
• 29:24
  Speaker 3: and what it means for pharmacies. We're talking about the
• 29:28
  Speaker 3: peptide and the information that came on the tail end
• 29:32
  Speaker 3: of the PCAC uh committee meeting recap so I guess
• 29:37
  Speaker 3: let's start there um day and give us whoever wants
• 29:42
  Speaker 3: to go first but give us an overview of what
• 29:45
  Speaker 3: was the information that was kind of relayed like what's
• 29:48
  Speaker 3: new with this stuff um you know give us a 30,000
• 29:52
  Speaker 3: foot view of and I might add.
• 29:54
  Speaker 4: You were there live right you were there at the
• 29:57
  Speaker 4: uh the meeting there that you saw it all go down.
• 30:01
  Speaker 4: Give us an update there. Start with Dave.
• 30:04
  Speaker 9: Yeah, I mean, that two-day event, July 23rd and 24th,
• 30:08
  Speaker 9: definitely well over 100, 150 folks in the room. Very
• 30:17
  Speaker 9: large conference room in the FDA campus in Maryland. Heated
• 30:24
  Speaker 9: arguments on both sides, right? the proponents as well as the,
• 30:31
  Speaker 9: let's go better words, the opposition or haters of the
• 30:35
  Speaker 9: peptides in the industry. So the event was very long.
• 30:43
  Speaker 9: Day one started around, I mean, started on the dot
• 30:47
  Speaker 9: at 8 a.m., ended well after 6 p.m. Day two
• 30:52
  Speaker 9: started at 8 a.m., probably ended after 4 p.m., close
• 30:56
  Speaker 9: to 5 p.m. There were exchanges between the proponents and
• 31:03
  Speaker 9: oppositions on the clinical safety and efficacy, but also a
• 31:10
  Speaker 9: lot of discussion on the policy.
• 31:14
  Speaker 2: Aspect of the peptide.
• 31:15
  Speaker 9: So what happened at the end of the day, the
• 31:18
  Speaker 9: day two, was that the FDA Pharmacy Compounding Advisory Committee
• 31:24
  Speaker 9: recommended six out of seven peptides to be added to
• 31:29
  Speaker 9: the 503A bulk list. Day one, they discussed BPC-157, KPV, TB500, MOTC.
• 31:40
  Speaker 9: Day two, Imidelta, Epitalone, and C-Max. And Imidelta was the
• 31:46
  Speaker 9: only one that was not recommended to be added to
• 31:50
  Speaker 9: the 503A bulk list. Now, to be clear, these peptides,
• 31:56
  Speaker 9: the six peptides, have not been added. It's up to
• 32:00
  Speaker 9: the FDA. There will be a comment and rulemaking process.
• 32:05
  Speaker 9: Who knows how long it's going to take? It could
• 32:08
  Speaker 9: be months. It could be years. FDA may, as they
• 32:14
  Speaker 9: did in a traditional sense, go with what the committee
• 32:18
  Speaker 9: actually recommended. But FDA may not ultimately follow the committee's recommendation.
• 32:30
  Speaker 4: Historically, they do follow the committee recommendation, correct?
• 32:34
  Speaker 1: Yes, historically they do.
• 32:36
  Speaker 9: FDA does follow, but in rare instances that they have
• 32:42
  Speaker 9: not followed are high-state cases, and I consider peptides to
• 32:47
  Speaker 9: be high-state cases.
• 32:51
  Speaker 1: Good point.
• 32:52
  Speaker 9: But at the same time, you know, You see, I mean,
• 32:55
  Speaker 9: at the same time, as we speak right now, you
• 32:59
  Speaker 9: go online, buy these peptides from grain market, you know, sellers.
• 33:04
  Speaker 9: Nobody know what's in it, but you could buy it.
• 33:07
  Speaker 4: I feel like I was in the room there, Dej,
• 33:10
  Speaker 4: whenever that gets into my next question, because, Ann, I
• 33:13
  Speaker 4: know you guys and Nicolette are working on how pharmacies
• 33:20
  Speaker 4: can learn about it, learn about this stuff. eventually roll
• 33:25
  Speaker 4: it out, implement it, you know, and adopt these peptides
• 33:29
  Speaker 4: in a meaningful way for their patients. What can pharmacies
• 33:35
  Speaker 4: do now in this period of wait, I guess, until
• 33:38
  Speaker 4: there's comments and the FDA makes some decisions? What can
• 33:43
  Speaker 4: pharmacies do now in terms of getting ready for this
• 33:48
  Speaker 4: potentially opening up for them? And we're talking retail pharmacies
• 33:52
  Speaker 4: who do not compound. You know, are there going to
• 33:54
  Speaker 4: be opportunities for them? And of course, the compounders as well. Yeah.
• 34:00
  Speaker 6: So there's going to be there's opportunities for everybody there.
• 34:03
  Speaker 6: And that's such a good point, Scotty, because, you know,
• 34:06
  Speaker 6: we've been like it's been a couple of months where
• 34:08
  Speaker 6: we're we want our pharmacies, you know, to already be
• 34:11
  Speaker 6: educated because you're already getting patients asking about it. Like
• 34:15
  Speaker 6: they brought up in the very beginning, these patients are
• 34:18
  Speaker 6: already using them. And they want to come to their pharmacist, right?
• 34:21
  Speaker 6: They want to ask the person who they trust. But
• 34:26
  Speaker 6: traditionally in pharmacy school, we did not learn about these
• 34:29
  Speaker 6: types of things. And honestly, there's been such a big
• 34:32
  Speaker 6: shift recently in the way that patients are thinking about
• 34:35
  Speaker 6: their health care. I really think that changed with COVID.
• 34:39
  Speaker 6: It changed with the GLPs. It changed with telehealth. So
• 34:42
  Speaker 6: now we have just a huge influx of patients that
• 34:45
  Speaker 6: are really thinking about like longevity, how do I make
• 34:49
  Speaker 6: myself actually healthier? So there's just so many patients that
• 34:53
  Speaker 6: are already asking about it. But I say now is
• 34:56
  Speaker 6: really the time where you really need to dig in
• 34:59
  Speaker 6: and you need to do some education on that. So
• 35:02
  Speaker 6: what we are putting together is an entire course on it.
• 35:06
  Speaker 6: So we're breaking it into two modules. Module one is
• 35:10
  Speaker 6: really going to be that kind of educational piece. So
• 35:13
  Speaker 6: we're going to really cover all the clinical aspects of
• 35:16
  Speaker 6: these peptides. And in addition, the ones that you already
• 35:19
  Speaker 6: can compound, like smorrelin and glutathione, and the GLPs if
• 35:25
  Speaker 6: you're getting them through patient-specific prescriptions. So we're going to
• 35:30
  Speaker 6: go through peptide fundamentals. What are they? What are the
• 35:33
  Speaker 6: different ways they can function within the body? We're going
• 35:36
  Speaker 6: to go over some kind of lifestyle factors so that
• 35:38
  Speaker 6: you can help support your patients, not just give them
• 35:41
  Speaker 6: the drug and say, you know, this is going to
• 35:42
  Speaker 6: make you healthy, but what's really going to help support
• 35:44
  Speaker 6: them long term. And then a clinical review of these
• 35:49
  Speaker 6: peptides broken down by class. So that way it's a
• 35:52
  Speaker 6: little bit easier to understand and remember what these peptides
• 35:58
  Speaker 6: are proposed to be used for. So we'll go through
• 36:01
  Speaker 6: like the big ones like regenerative medicine and immune health.
• 36:04
  Speaker 6: weight and metabolic health, sexual health and fertility, neurology and
• 36:09
  Speaker 6: cognitive health. There's so many great benefits to these peptides
• 36:14
  Speaker 6: that we want to make sure that our pharmacies feel
• 36:17
  Speaker 6: comfortable with the knowledge that they need in the background
• 36:20
  Speaker 6: to really help with their patients kind of understanding what
• 36:24
  Speaker 6: are some common monitoring parameters or side effects or even
• 36:29
  Speaker 6: what kind of patient populations would each peptide be really
• 36:32
  Speaker 6: good for. And then the second module, which we're going
• 36:36
  Speaker 6: to be releasing, is kind of that implementation piece. So
• 36:39
  Speaker 6: exactly that, where can I do this if I'm just
• 36:42
  Speaker 6: a regular retail pharmacy? And your answer is going to
• 36:45
  Speaker 6: be yes there. There's Central Phil, which you could do
• 36:49
  Speaker 6: it coming from another 5083A pharmacy. We're also expecting these
• 36:54
  Speaker 6: peptides to be available from 503Bs as well, which is
• 36:57
  Speaker 6: another topic of discussion entirely, but we think the industry
• 37:02
  Speaker 6: will also move that way. And then kind of just
• 37:05
  Speaker 6: understanding how would you set that up in your pharmacy
• 37:09
  Speaker 6: and the tools to really be able to implement it
• 37:12
  Speaker 6: so you can start providing it to your patients. But
• 37:14
  Speaker 6: that first piece, the clinical education piece, I think right
• 37:18
  Speaker 6: now is the most important because you do need that
• 37:22
  Speaker 6: basis before you really bring them into your pharmacy. And
• 37:27
  Speaker 6: we still have a presale going on. So I think
• 37:32
  Speaker 6: I think I'm able to share with the podcasters out
• 37:34
  Speaker 6: there too, but we do have a discount code, peptide20
• 37:38
  Speaker 6: going on, I think until the 11th. So I'm not
• 37:40
  Speaker 6: sure what day this will actually go out, Austin, but
• 37:44
  Speaker 6: I'm sure we can also get it extended if we want.
• 37:47
  Speaker 6: But you can always reach out to us. I'm sure
• 37:49
  Speaker 6: we'll go over it at the end, but hello at atrium24.
• 37:51
  Speaker 2: Com.
• 37:54
  Speaker 6: If you have any interest in that or if you
• 37:56
  Speaker 6: want any additional information.
• 37:58
  Speaker 3: Our last clip comes from Understanding Basis. featuring Alan Sykes
• 38:03
  Speaker 3: at Sykes & Company. He talks about how basis builds
• 38:06
  Speaker 3: over time and what gain on a sale actually comes
• 38:10
  Speaker 3: down to in a pharmacy. Check it out. We've gotten
• 38:13
  Speaker 3: this question a lot, which is the concept of basis.
• 38:19
  Speaker 3: So Alan, give us an overview. What is basis for
• 38:24
  Speaker 3: owners and why is it important? Why does it matter?
• 38:28
  Speaker 3: What are some things to consider when it comes to BASIS?
• 38:32
  Speaker 7: Yeah, BASIS is a pretty simple topic, yet it can
• 38:35
  Speaker 7: be very complicated. But as an owner, it's essentially what
• 38:39
  Speaker 7: you have invested into the pharmacy itself. So if you
• 38:44
  Speaker 7: assume you have an S corporation, which is an entity
• 38:46
  Speaker 7: that passes through the profits and the losses of the
• 38:49
  Speaker 7: entity back to the shareholders in proportion of the shares
• 38:54
  Speaker 7: that they own, You obviously have made probably at some.
• 38:58
  Speaker 8: Point in time an initial investment. You may have loaned the.
• 39:04
  Speaker 7: Entity some monies over time that are actually owed to
• 39:08
  Speaker 7: you directly. That can also have an effect on your
• 39:12
  Speaker 7: income tax basis as well. You obviously have earnings and
• 39:18
  Speaker 7: distributions and losses potentially over a period of years. And essentially,
• 39:25
  Speaker 7: a basis is a running total of what you've invested,
• 39:29
  Speaker 7: what you've earned, what you've lost, net of the losses
• 39:36
  Speaker 7: that you've incurred, net of the distributions that you've taken out.
• 39:41
  Speaker 7: And then if money has been loaned to the business directly,
• 39:46
  Speaker 7: not indirectly by just signing a note as a guarantor,
• 39:50
  Speaker 7: but directly lending money to the entity, that adds to
• 39:54
  Speaker 7: that basis as well.
• 39:56
  Speaker 8: And then particularly with an S corporation.
• 39:59
  Speaker 7: And obviously when an entity is sold, that basis becomes
• 40:06
  Speaker 7: very important because your gain is the difference between what
• 40:10
  Speaker 7: you receive less that cumulative basis that you've had over
• 40:14
  Speaker 7: a period of years.
• 40:16
  Speaker 8: Pretty simple concept.
• 40:18
  Speaker 3: So if I'm buying a pharmacy, that step up in
• 40:22
  Speaker 3: basis is something that I'm going to be heavily considering, um,
• 40:27
  Speaker 3: with the, I guess with, you know, when it comes
• 40:30
  Speaker 3: to terms of the sale there, when I'm, when I'm
• 40:33
  Speaker 3: buying the pharmacy, because there are certain assets that I'm
• 40:35
  Speaker 3: going to get that step up in, in basis.
• 40:38
  Speaker 7: Well, obviously if, if you're, if you're the buyer, your
• 40:42
  Speaker 7: basis in the assets, if you're buying assets, is it
• 40:45
  Speaker 7: going to be what you pay for those assets? But
• 40:48
  Speaker 7: if I'm the seller, My basis in the entity as
• 40:52
  Speaker 7: a whole is going to be my cumulative money that I've, again, invested, earned,
• 40:59
  Speaker 7: less distributions I've pulled out, less losses, less direct loans
• 41:05
  Speaker 7: that I've had directly into the business.
• 41:08
  Speaker 8: So my basis on the entity's assets, the entity as
• 41:13
  Speaker 8: a whole, is just that. You as the buyer... will
• 41:18
  Speaker 8: get a stepped up.
• 41:20
  Speaker 7: Or a new basis for what you pay or either
• 41:23
  Speaker 7: the stock of that entity that you buy from me
• 41:27
  Speaker 7: or the individual assets if you're purchasing and cherry picking
• 41:34
  Speaker 7: on certain assets on the buying side.
• 42:01
  Speaker 4: Thank you.