RETAIL & WHOLESALE

PHARMACY INDUSTRY
Capgemini Technology Services India
Case Study

By Liza Dsouza
 KEY TRENDS SHAPING THE RETAIL &
WHOLESALE PHARMACY INDUSTRY

• Click & Collect Model

• Prescription collection lockers
• Front-end Merchandising
• Incorporation within other major retail outlets (malls, supermarkets, etc.)
• 24x7 operation and drive-through deliveries
• Direct mail prescription services
• Customer Loyalty Programs
• Access to Specialist to solve queries regarding dosage & side-effects
• Intelligent Automation/AI powered processes (improving supply chain efficiency, prescription fulfilment,
demand forecasting)
• Testing, Diagnostics, & Vaccination Services
• Generic Conversion: Shift to generic prescription drugs
 COMPANY GROWTH STRATEGIES

• Consolidation among insurers and pharmacy benefit management (PBM)

companies and healthcare providers
• Expanding International Reach
• Mergers & Acquisitions
• Integration of Smart Technologies
• Partnerships & Collaborations to improve Supply Chain Efficiencies
• Investments in House Brands/Private Labels
 CURRE NT AND F UTURE MARKET P OTE NT IAL F OR
THE EMERGING AND DIGITAL TECHNOLOGIE S OF
T HE INDUST RIES

• Enter Electronic Prior Authorization (ePA) – Allows communication with

insurers to fasten the approval process and reduce wait time for prescriptions
• Electronic Prescribing (ECPS) – Allows electronic tracking of the prescription
to avoid drug abuse
• Integration of electronic medical record (EMR) software – Allows pharmacies
with in-store virtual clinics to easily understand patient history
• Central fill as a service – Retailers are now using central fill as a service,
wherein, they licence the central fill services offered by a third party and avoid
the capital, inventory carrying, and labour costs
 AI, MACHINE LEARNING, AND IOT

Allows price optimization & improved supply chain efficiencies by processing data such as
market trends, age of inventory, and prior sales of the retail outlet
• Automatically generated market-wide sales and markdowns to stores
• Demand forecasting through inbuilt predictive models
• Improved warehouse efficiency to through smart inventory management
• Integration of chatbots on online distribution networks
• Flagging patients unfilled prescriptions or refilled prescriptions across store networks
• Provides General Population Health Management actionable data that can be used to develop
strategies for the respective store
• Device to device communication to improve speed of drug inventory management through IoT
WALGREENS BOOTS ALLIANCE,
INC.
 BUSINESS MODEL

Business Activities
• Distribution & Dispensing Medicines
• Health & Wellness Products
• Beauty & Skin care Products
• In-house Product Development & Sale

Services
• Delivery of Medication
• Walgreens Immunization Services

Sales Channel
• Retail Stores
• Digital Platform (App & Website)
 STRATEGIC PRIORITIES & OBJECTIVES

• Strategic Partnerships with technology, health and retail sectors to enhance product
offerings
• Investment in physician-led primary care clinics
• Investment in generic version of drugs: equal or better margin for Walgreens
• Mergers & joint ventures in the pharmaceutical wholesale market to enhance market
presence
• Divestitures of non-performing business assets and divisions
• Long term agreements and arrangements with distribution companies
• Diversified into Optical services through the acquisition of Boots in the UK
 CHALLENGES/RESPONSE TO CURRENT
MARKET STATE

COVID 19 Pandemic
• The onset of the COVID 19 pandemic has led the company to increase its
investment in expanding the use of drive-thru locations and focusing on home
delivery and digital services
• During the second half of 2020, the company temporarily refocused certain
resources from their Transformational Cost Management Program to work on
COVID-19 impacts- they delayed the roll out of certain growth initiatives and
selectively delayed investments in certain planned initiatives.
• Remote operation during the pandemic can increase cybersecurity risks
 CHALLENGES/RESPONSE TO CURRENT
MARKET STATE

Reductions in third-party reimbursement levels and shift in pharmacy mix

towards Medicare Part D prescriptions

• The company has accepted market competitive reimbursement rates in order to

secure preferred relationships with Medicare Part D plans serving senior
patients with significant pharmacy needs.
• The company is developing and expanding relationships with commercial
third-party payers to enable new and/or improved market access via
participation in the pharmacy provider network they offer
 CHALLENGES/RESPONSE TO CURRENT
MARKET STATE

Highly competitive and constantly evolving industry

• Investment in disruptive technologies

• Improvement in digital experience
• Outsourcing critical information technology to third parties
• Migration of applications to the cloud

Current providers
Tata Consultancy - IT Run and Operational managed services
Microsoft - strategic cloud provider
 OPPORTUNITIES
FOR CAPGEMINI

The company’s Transformational Cost

Management Program is expected to
increase investment in IT that can help
the company increased cost efficiencies.

Capgemini can focus on providing

digital solutions and consumer loyalty
procuring insights to Walgreens

Reference: Annual Report 2020

 OPPORTUNITIES FOR CAPGEMINI

• Transformation of Pharmaceutical Retailers through supply chain management

• Global Regulatory Compliance Solutions
• Augmented Reality for Beauty Products and Self scans
• Insight Driven Merchandizing
• Digital Solutions with respect to maintaining a customers family account
• The Smart Digital Store
• Blockchain for retail drug stores
• Developing a Healthy basket Index for consumers, rewards for healthy purchases and activities
• Smart Labelling
• Analytics, AI, Machine learning