Rite Aid CEO Heyward Donigan says the future of pharmacy should be full-service and “transportable.”
“During covid, everyone understood the power of pharmacies,” she said in an interview with The Washington Post. “That really accelerated the world view of what a pharmacist can do.”
Rite Aid, which operates more than 2,300 stores in the United States, reported revenue of $24.6 billion in its fiscal year ended February, up 2.2% from a year earlier. But it is net losses increased to $538.5 million from $100.1 million due to store closings and other expenses.
In her first few years on the job, Donigan shut down about 150 unprofitable stores, made plans to roll out small stores in underserved markets, remote workers and deploy more technology to automate some tasks. She has also relocated the company’s headquarters to a modern waterfront campus at Philadelphia’s Navy Yard from Camp Hill, Penn. It is designed around meetings versus individual workplaces and opens in July.
“I see remote opportunities not only as more efficient, but also as an opportunity to get to know people in different regions with more diversity than we could ever have done,” she said.
Donigan explains her vision for the future of pharmacy and its impact on workers. The following interview has been edited for clarity.
Q: How does Rite Aid navigate the future of work?
A: We are remote first for our business partners, and we have a camera-on policy. So I embrace seeing your pet, meeting your husband, the lawnmowers, the leaf blowers, the Instacart delivery.
We also take a break in the middle of the day. Don’t book meetings between 12pm and 1pm if you can avoid that. Go for a walk, walk your dog. And if possible, turn off the cameras at 6:30 PM. No meetings on Friday afternoon. We regularly have off-sites. We still have a strict covid protocol for our face-to-face meetings. We need two antigen tests.
Q: How does Rite Aid rethink the workplace?
A: In fact, we had already started it before the pandemic. When I first joined the company, I said, “You can live anywhere you want.” We founded WebEx back then and trained everyone. I hired people from all over the country and allowed them to work from home and come in for meetings and collaboration. So when the pandemic hit, we were pretty well prepared. Seeing the benefits of remote working, we realized that this was an opportunity to become a more modern workforce and not to argue about going back to the office.
The other thing it really offered us was an opportunity to think about real estate in a different way. Although Camp Hill has been the company’s headquarters for years, it was very difficult to get to.
Q: What are Rite Aid’s Regional Collaboration Centers?
A: What we found is that people were busily flying around to meet customers outside the venue, successfully working remotely or going to happy hours together, and the space went unused. So in the end we didn’t rent any of those spaces anymore. However, we are committed to building our new technology center in Raleigh, North Carolina, where our technology teams will go to collaborate, design and do lab work.
Q: What are the Rite Aid technology teams working on?
A: Technology supports the ability of our pharmacists to deliver the right medication, quality and clinical interventions. A workflow tool asks pharmacists to do [an outreach]† We also have a major recall of all our technology infrastructure and new processes and platforms that are currently being developed.
Then we have our cash register systems in our stores, which are quite outdated. We’re really going to be a cloud company. We are developing a native app. We have third party delivery. We have a digital marketplace.
Q: How does Rite Aid’s technology help pharmacists target customers with the care they need?
A: Because we get all the data [based on prior visits, purchases and health plans] – I know it might sound a little scary – we know if you’ve been taking your meds regularly. So when you come to the store, we can suggest any test you may need, give you one, or suggest you see your doctor.
The new elements are the testing capabilities we can offer a customer, a comprehensive vaccine offering and holistic therapies. Health plans give us information about their members and the specific clinical categories they want us to intervene for.
Q: What technical improvements has Rite Aid made to respond to the covid crisis and how will they impact the business ahead?
A: We had to come up with a vaccine scheduler online almost within weeks because the federal government required it. It’s a tool that will now be used for all of our vaccines, not just covid. We’ve also radically changed our platform to allow people to refill, pay and have a prescription on the app or in the browser. That was very important because people were afraid to go to shops. We launched Instacart and DoorDash. You can shop the Rite Aid store on Amazon. Video conferencing was launched nationwide.
Q: How have your digital partnerships affected the business?
A: We grew these digital delivery and convenience channels by 50 percent last year and we expect another 50 percent or more this year. Prescriptions are almost back to where they were before covid, and we’re seeing an increase in people wanting their prescriptions delivered. What we will continue to work on is how we extend our engagement with pharmacists in-store, over the phone, [or via] chat or video.
Q: How is Rite Aid dealing with the labor shortage?
A: We are over the worst. The hot spots are mostly consistent in the Pacific Northwest and in Western Pennsylvania. On this point, [the shortage is primarily for] pharmacists and technicians. We moved remote work, we took the calls from the stores and forwarded them to the call center. These are changes that are permanent.
Q: What will the pharmacy of the future look like?
A: For me, the pharmacy of the future always starts with your phone. As a customer, I do not see a pharmacy as a shop. No one knows more about prescription drugs than a pharmacist, and I would love to [my doctor] to talk to my pharmacist on my phone about which prescriptions I should have. The evolution of this company is how to make the pharmacist transportable.
Q: What are the biggest challenges in building that future?
A: The challenge is how to enable engagement in this omnichannel way. We are building this integrated full-service pharmacy. For us it’s just connecting all the assets.