The fastest-growing pharmacy in Portland isn’t CVS, Walgreens or Rite Aid. It’s a locally based company that has bucked the industry trend of mega-drugstores by offering pharmaceutical services with a personal touch.
Over the past year, Apothecary by Design LLC has made multiple lists of fastest-growing companies, including No. 1,813 on the Inc. 5000, based on its three-year revenue growth of 228 percent from 2010 to 2013. According to Inc., the company was one of just seven privately owned specialty pharmacies with a growth rate of over 100 percent during that period.
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The company expanded in 2013 into a second, larger facility at 141 Preble St. Its original retail pharmacy location at 84 Marginal Way remains open.
Apothecary by Design is actually three businesses in one. It has a retail pharmacy and coffee shop, a compounding operation where drugs are put into their proper dosage and form such as pills or injections, and a specialty pharmacy that makes drugs for treating people with rare medical conditions such as organ transplants, infertility or AIDS.
The specialty pharmacy is the fastest-growing segment of the company, at 15 percent to 20 percent a year, said Mark McAuliffe, managing partner of Apothecary by Design.
Transplant patient Debra Warshawsky has been getting her anti-rejection drugs from the pharmacy since July 2009, when she received a kidney transplant from her sister. She had the procedure done at Maine Medical Center in Portland, which refers all of its specialty patients to Apothecary by Design.
Warshawsky, who lives in Ogunquit, said the drugs were very expensive at first – about $1,000 a month – and that the pharmacy worked with her to defer payments until after she had received her reimbursement checks from Anthem Blue Cross Blue Shield.
Five years later, the kidney is functioning well and Warshawsky’s body has not rejected the organ.
“As soon as the kidney was in me, it was great,” she said.
Specialty drugs can cost thousands of dollars a month, which makes it essential to work with patients to come up with payment plans they can manage, McAuliffe said.
“There is a lot of benefit investigation that we do here, that you wouldn’t typically get, to see if you have coverage,” he said.
The pharmacy also seeks out manufacturer coupons or grants from private foundations to help patients afford their drugs, McAuliffe said.
“This year we have already found over $1.5 million in patient-assistance funds,” said Catherine Cloudman, one of the five partners who own Apothecary by Design.
The company was founded in 2008 by three pharmacists – Tom Madden, Joe Lorello and Greg Boucouvalas – along with McAuliffe and Cloudman, who have business backgrounds.
Another important aspect of the specialty pharmacy is disease management – making sure patients understand the stages of their medical condition, manage the side effects of treatment and continue to take their medication as directed.
“Our staff is highly trained in these disease states,” McAuliffe said. “We have special software (for each) disease state that tracks our interventions and helps with what we’re supposed to do.”
In its first year of operation, Apothecary by Design had the equivalent of about 19 full-time employees and generated sales of roughly $3.6 million. Now it has 65 employees and projected annual revenue of $85 million, McAuliffe said.
Apothecary by Design employs workers in a number of fields, including pharmacy, nursing, nutraceuticals, customer service, sales, shipping and administration.
McAuliffe said partnerships with regional institutions such as the University of New England and Husson University have made it relatively easy to find quality candidates to work at the pharmacy.
“We’ve had no problem finding employees,” he said, including pharmacists.
The company’s first profitable year was 2012, he said, although he would not disclose the dollar amount. It experienced a net loss in 2013 because of two key investments that McAuliffe said have allowed the pharmacy to grow sales much more rapidly this year.
One of those investments was the Preble Street headquarters, which contains two compounding labs, storage and preparation space for the drugs, a packaging and shipping center, cubicles for disease-management workers and administrative offices.
The expansion was funded in part by a $150,000 business loan from Bangor Savings Bank that was 90 percent guaranteed by the Finance Authority of Maine, known as FAME.
FAME approved the loan guarantee in 2012 when Apothecary by Design had 38 employees. The goal was to help the company retain and create jobs, which it has done.
The company also obtained a job-creation loan and other financial assistance from the city of Portland, McAuliffe said.
“One of the things I tell people is, ‘Oh, Portland is not a good place to do business?’ In our case it is,” he said. “We’ve had a great experience with both Portland and the state.”
The company’s other major investment in 2013 was working to obtain an important industry accreditation that allows it to work with a broader range of health insurance providers.
The accrediting body is URAC, an independent nonprofit organization based in Washington, D.C., that approved Apothecary by Design’s application in August.
The accreditation will help the company grow, but there will be challenges, McAuliffe said. The pharmacy industry is dominated by large retail chains. Small, independent pharmacies are few and far between.
But the biggest threat could be from online pharmacies, whose popularity has been growing rapidly, McAuliffe said. Apothecary by Design does not offer online services, although it does some of its business by mail order.
The company plans to tackle those challenges by staying focused on personalized, patient-to-pharmacist relationships that customers can’t get anywhere else, McAuliffe said.
“Our main interest is to make sure you get what you need,” he said.
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