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

Schedule an Rx AssessmentWelcome everyone to the Bottom Line Rewind, your monthly recap of the Bottom Line Pharmacy Podcast. This month, we feature interviews on topics about Inventory, AI and Automation, the Peptide PCAC meeting, R&D Tax Credits, and Basis when buying a pharmacy. Click below to check out the full episodes:Episode 1: Inventory Management in 2026 with Jared Barton, CEO of Inventory IQEpisode 2: Inside a Pharmacy AI Bot with Ross Miller, VP of Sales at TJM LabsEpisode 3: R&D Tax Credit, Trump Accounts, Taylor Swift's WeddingEpisode 4: Peptides, Policy, and PBMs with Dr. Anne West, Clinical Pharmacist at Atrium24, Dae Y. Lee, PBM & Pharmacy Practice Group Co-Chair at Buchanan Ingersoll & Rooney, P. C. Episode 5: Understanding Basis When Buying a Pharmacy with Ollin Sykes, CPA, CMA, CITPStay connected with us:Facebook | Twitter | LinkedInYouTube | TikTok | Instagram | Blog

• 0:05Speaker 00

  You are listening to the global network of podcasters dedicated to the pharmacy profession. Welcome to the pharmacy podcast network.

• 0:32Speaker 01

  Welcome back to the bottom line rewind, the show that shares all the best moments from this past month on the bottom line pharmacy podcast. This month, we've got four interviews lined up on inventory, AI, R and D, tax credits and peptides. Plus we're bringing you an exclusive interview that talks about understanding basis when buying a pharmacy. If you want to check out the full conversation, you can find the links to each of these interviews in the description of this episode. Check it out.

• 1:03Speaker 01

  First up is a segment from our interview on inventory management in 2026, featuring Jared Barton, the CEO of Inventory IQ. We talk about what perpetual inventory actually means and why most pharmacies aren't as dialed in as they think. Here's that moment.

• 1:21Speaker 02

  We always ask you this question, you know, what, what percentage of our pharmacies out there in general are on perpetual systems? And I think we're always at 50% or 40%.

• 1:33Speaker 02

  Are we any better now?

• 1:34Speaker 03

  Better, right?

• 1:36Speaker 04

  It depends.

• 1:39Speaker 04

  Maybe it's recency bias, but it depends on my answer largely depends on who I talked to last week when I talked to you guys.

• 1:48Speaker 04

  I just think that we've got such a loose interpretation of perpetual inventory throughout the industry that like, when I think perpetual, I want it to be counselor updated, going and coming, orders are going out of the system and coming back into the system. And then when I ask people that question, hey, are you using perpetual or you're not, they're like, oh yeah, we're on perpetual. And then I have to get like three questions deep to derive that, oh, well, we're keeping up with our cows. We're not sending our orders this way. We're kind of receiving them, but not for these whole sellers.

• 2:21Speaker 03

  I feel like most client, new clients that we work with all, almost all say, oh yeah, we got perpetual. Maybe it's not fully the way it should be full perpetual, but they're, they're not counting on December 31st anymore. I don't.

• 2:36Speaker 04

  Yeah, that's, that's. So I would say across, I would say across the.

• 2:44Speaker 04

  Yeah, yeah, we're quasi, quasi perpetual, but I would say across the industry, we're getting a little better. Like people are recognizing the need to have that transparency in data for decision making because like we're either by necessity or by default realizing that that's 80% of our spend for the year. And so if we're going to measure a number, that's probably a good one to measure, you know, where we can capture four fifths of the business. But I don't know, I feel like there's a lot of people that are cherry picking parts of that process because it's the way we've always done it, or it's a little easier to do it this way. And so I, I don't know, I still think we're in that one out of two, four out of 10 range.

• 3:28Speaker 04

  Fully perpetual could tell you right now what the inventory is. And then accuracy is the next question.

• 3:35Speaker 02

  I had a new client come on board. Their turns were four.

• 3:40Speaker 04

  All right. So my number is 1-800-250.

• 3:44Speaker 03

  Have you sent them Jared's information?

• 3:47Speaker 02

  So we had a big old conversation about that and well, I don't know if I did or not, but if things don't get better, that, that conversation will, will come up.

• 3:58Speaker 01

  That's for sure. So Jared, when it comes to implementing perpetual inventory, are you noticing how AI can kind of help with that process in a pharmacy a little bit more? I don't know if you've used, if you've been using AI to help with like perpetual inventory implementation or whatnot.

• 4:16Speaker 04

  So one thing that we've started doing over the last couple of years, this is twofold benefit to the customer is essentially we have divorced our analysis from the time of the count. And that's important because it makes the count take less time, takes the analysis, take less time together. That process takes about 80% of the time that it took us to do a full overhaul perpetual inventory for a customer four or five years ago. Right. So we've cut that some in terms of efficiency.

• 4:47Speaker 04

  What it, what it impacts that doesn't show in kind of total time is that that count getting in, in half the time that it used to take means that the count's more accurate and the customer is able to utilize that

• 5:00Speaker 04

  50% more quickly. Right. So leaves less margin for error, accounts are more accurate. The analysis piece takes less time because somebody specializes doing that in a controlled environment where they're not interrupted in the pharmacy, be that conversation with technician, conversation with pharmacist, phone call, different things like that. What's gonna happen on that is I don't know how much more quickly we can get the count portion because that's the physical portion. And Elon hasn't gotten there with robots yet. Right. So I don't know, and even if he did tomorrow, I don't know that we'd be able to trust the dexterity there, not to crush or destroy product

• 5:40Speaker 04

  to get it right and things like that. Like I think it'll be a while before that type of robotics reaches the independent pharmacy market. It'll reach the chain market, Amazon, Walmart, things like that first, because those are the people that do stuff like that. What it will do is it'll continue to cut our time and improve our accuracy on the analysis side. And then what we'll be able to do is shorten the window, how often we can do that, which brings seasonal trends and more proactive approach to order points into the mix, which is our focus for the next six to 12.

• 6:15Speaker 02

  It'll come to a daily point where you're doing a daily.

• 6:18Speaker 03

  Yeah.

• 6:19Speaker 02

  Or you could.

• 6:20Speaker 04

  Exactly.

• 6:21Speaker 03

  Yeah.

• 6:22Speaker 04

  Exactly.

• 6:22Speaker 03

  So what's the.

• 6:24Speaker 04

  And so some products you don't want to identify for a daily, right? Because then if you're talking about low enough for your order points, you're talking about these massive gyrations and stocking the product, not stocking the product. But your fast moving products that demand shifts on largely, especially seasonally cough, cold, flu, vaccines, stuff like that. You're really talking about getting extremely tight with stocking those.

• 6:47Speaker 03

  Yeah. So some of the times that we see, you know, inventory, people that have perpetual systems, some of our clients that they seem to get out of whack a little bit. What we ended up figuring out is they haven't updated the pricing correctly, or they're not keeping those, the pricing, or there's a pricing error in there. So what is, I don't know if this makes sense, but what's the best way, like the people that your high performers, the ones that really have their things up to date and that, what are they doing that some are not doing? Like, what are the steps to ensure the best system?

• 7:19Speaker 04

  Don't get too cute with it. And I know that's a very like Southern euphemism way to say it, but the kiss.

• 7:27Speaker 04

  Keep it simple.

• 7:30Speaker 04

  So the people that we see that have the least pricing errors are typically ordering majority of their drugs. And this is individual to your mix, your script mix, your payer mix, all that good stuff. And we could talk, we could talk primary vendors versus a secondary market all day long. You know, if we play in that arena and two separate entities, so, so we could really get into weeds on that. But those folks that have the least pricing errors, and this will sound goofy in light of Amerisource's little stumble a month and a half ago. But they typically order the majority of their drugs from one large, well-established wholesaler that has extremely tight EDI constraints that's lined out.

• 8:11Speaker 04

  And then maybe they supplement that for, you know, for out of stocks or something that's hard to get, or something where their primaries just out of line with a couple or a handful of secondary wholesalers that are large enough to support EDI transmission. And the, the common thread there is just EDI transmission of orders back to the pharmacy. So you can receive them into your pharmacy management system. I know it can be extremely attractive. There's a couple of small secondaries on the market right now that are giving people pricing that they don't understand. I know that because they're telling me on the phone, they're selling it to me for this.

• 8:49Speaker 04

  And I'm like, that seems like a problem. That seems like a red flag to me, you know, in a, in a world of, we love to call things red flags. I'm like, eh, that's probably a problem. We don't know yet.

• 9:02Speaker 04

  I'm not calling it disingenuous or above or below the law, above or below board. But ultimately if that secondary won't facilitate EDI transmission back, especially in a pharmacy that's moving volume, like that's gonna cause some sort of workflow breakdown at some point. Nobody's.

• 9:22Speaker 03

  And for someone who has a decent average perpetual system, working pretty well, what do you see as a necessary timeframe that a physical count should still be done? Have you guys come in and do a good count and make sure everything's on the up and up?

• 9:41Speaker 04

  Yeah. So there's a trick, trick question, because I think that you need to do it at least once a year. I understand I have a vested interest in that because like we, we share some customers that a lot of the folks in the industry, if they haven't counted once a year, I'm at least in the running to count it, you know? So I get that.

• 10:02Speaker 04

  A lot of it also depends on how often are you, how often are you looking over and what's your cycle count procedure, you know? So if you had a robust cycle count procedure, I could understand going a little longer than that, especially if in your cycle counts, you're using the tool to dictate accuracy and you're not just blindly changing things and going, oh, well, you know, we got close, you know? But if you're cycle counting stuff and it's spot on, spot on, spot on, and you don't have a lot of negative inventory items in the system, you make it go a little longer than that. But I don't find that to be the case with most people.

• 10:38Speaker 02

  What is a robust cycle count process look like?

• 10:41Speaker 04

  I would like to count through the inventory at the bare minimum. The average drugstore, you can have 1,500 NDCs on the shelf over the course of time, you know, that's roughly 150 a month, something like that, 125 a month. If you break that to 22 working days, count like five to seven products a day. I don't feel like that's a huge, I don't feel like that's a huge lift to count, you know, to count that many. I see twos maybe a little more often than that, maybe quarterly. The drugstores that I get to choose how much they do, where we had an owner come to us and go, hey, I can't micromanage this. I want you to micromanage it. I haven't counted quarterly.

• 11:24Speaker 04

  And, you know, let's stay more accurate.

• 11:26Speaker 01

  Next up is an interview from inside a pharmacy bot featuring Ross Miller, VP of Sales at TJM Labs. They're talking about what a pharmacy AI bot actually is and automation ideas beyond data entry. Here's that moment.

• 11:41Speaker 02

  And I guess a low hanging fruit that I see clients kind of going and, and talking with you guys is, is literally from a data entry standpoint. And when that prescription's coming into the door at the pharmacy to getting it into the script system, processing it and so forth. I know that's a key area you guys focus on, among many others, I'm sure. But I guess walk us through like what TGAM Labs kind of focuses on and where those kind of low hanging fruit areas are for pharmacies in terms of automating kind of that front

• 12:21Speaker 02

  end process, or maybe even beyond that for, for, for the pharmacy?

• 12:28Speaker 05

  Yeah, I think you sort of hit the nail on the head, right? Our moat and the reason we exist is to automate, you know, mundane, tedious, repeatable tasks in the pharmacy. To your point, the easiest way to sort of wrap your head around how to get started, like what's the floor for this type of experience? It's data entry. That is the, the biggest pain point that we see across pharmacies today, right? I can't find techs, my best tech left. I spoke to someone, I think in the last couple of weeks, who said I lost four techs all the same time during holiday season. Like that is a super painful proposition for a pharmacy. And the pharmacy owner, folks who don't want to actually be involved with

• 13:10Speaker 05

  this, end up sort of taking on the burden, you know, or they had write aid closures down the street, right? And they took on all this additional volume. It's really hard to find good people. And I think COVID has sort of pushed some of this as well. Like there's been a lot of techs that just left the industry and never came back. And we don't think they're ever going to come back like the way they probably were in the past. So we're really sort of at the point now, we're automating over half a million prescriptions every single day. We went from about 30 pharmacy groups last summer when I started to over 500 today. We believe this is, yeah, this isn't, this is no longer futuristic, right?

• 13:53Speaker 05

  This is in, in practice. I know you guys know Encore, our ex automation. Kyle's now our COO. He's driving our retail business. We acquired Pharmasol, voice AI company to focus on inbound outbound calls. So we're really like at the, the tipping point of what this looks like in practice. It's super exciting. And Scotty, to your point, there's all sorts of other things we can do. Like we have groups that are automating billing, invoicing, shipping, you know, again, helping with, with making referral requests on, on the phone. We have people asking about how do we handle ordering and inventory, like all these other pain points that customers are surfacing. We're now figuring out ways to

• 14:38Speaker 05

  build automation to support that, to answer your question.

• 14:41Speaker 02

  Yep. That's awesome.

• 14:43Speaker 03

  So in plain English, for some of our listeners who haven't even jumped into the world of AI yet, so they're a little, you know, slightly adept, what exactly, you know, just in a summary form, would that look like? Or what do you, what are you guys doing exactly?

• 14:58Speaker 05

  Yeah, look, I think AI can be scary. Okay. Like let's, let's call, let's, let's call it like it is. Like people look at this kind of thing and they say, it's coming for my job. You know, I would actually argue that we're up leveling and sort of, you know, giving people, you know, the ability to be more valuable in their business. And what we're really doing, so you understand like how, who we are and how we've gotten here, is we're a company of almost entirely pharmacists and engineers. Like our founder, pharmacist and engineer. Kyle from Encore, pharmacist and engineer. Natalie from Pharmasol is a pharmacist. Her co-founder is an MIT engineer. Like we have an executive leadership team that comes from pharmacy, understands pharmacy and understands how to automate. So really,

• 15:41Speaker 05

  I would say what we're doing is we're building, we call them digital workers, right? And they're there to supplement and sort of improve upon what's happening in the pharmacy. And honestly, we would much rather see people that are doing more value added things in the pharmacy. Like we want our folks in the compounding lab, mixing drugs. We want our people focused on wellness clinics, on LTC at home, on, you know, patient outreach, patient care. And we are there again, to take care of the things that you probably don't want to be paying people to do.

• 16:15Speaker 03

  Right.

• 16:17Speaker 02

  Yeah, that, that data entry is, and you know, those mundane, repeatable tasks are things that certainly, you know, you, you want your high value trained professionals not maybe doing that. You want them going out and talking to Miss Jean about, you know, some supplements to help her ailment or whatever it is. So, you know, there's, it opens the door for those future revenue opportunities that many pharmacies are trying to get into, trying to find what fits in their area. And, and that automation piece can, can help lessen that burden of the, the, the increasing cost, the time, more employees, things like that to do that. So.

• 17:00Speaker 03

  And Scotty, I mean, I mean, it just makes me think, you know, we're having these same conversations on our side, on the accounting. You could have inserted everything you just said and changed pharmacy to accounting. I mean, those mundane tasks, those, that dev entry, anything that you can take, we're, we're really pushing our staff to do the same because we want to use them in other areas. Like you said, just lift them up to do other more important tasks. So this is all over the board.

• 17:24Speaker 02

  All industries.

• 17:25Speaker 03

  Yep.

• 17:26Speaker 01

  Yeah, absolutely. And Ross, one thing that you said that I think I kind of want to dive into a little bit more is, yeah, you've got the data entry piece that AI can cover. But you said there's a lot more that it can do. And I feel like a lot of pharmacy owners that are just starting to implement AI, you know, they're using it for that data entry piece. But I know that PJM Labs has a whole suite of things that it can cover from, you know, how it works with providers and, and stuff like that. So talk a little bit more about like, what are, what's the world of opportunity with AI outside of just data entry and, and some of those mundane tasks?

• 18:07Speaker 05

  Yeah. I mean, to be honest, I don't really know what it looks like, you know, six months online a year from line, because the world is changing, the world is changing so fast, right? We usually build because our customers tell us this would be super impactful, right? So you brought up a really good point, Austin. We were being asked by every PK customer, Pioneer customer, Liberty customer, you know, all these compounders. Have you solved for, you know, how do we capture clean prescriptions into the pharmacy?

• 18:39Speaker 05

  Do you know a provider portal that's out there, right? And there were a couple out there. And I think we sort of got tired of just referring folks to the two existing ones. So our founder decided to kind of build his own provider portal, right? So we now offer a provider portal. Again, some pharmacy management systems have their own portal attached to it already, but most don't. And, and you know, it's super painful when a prescriber will write a prescription into a pharmacy and has nothing to do with what they actually fill in this, in the, in the pharmacy. Right? So the provider portal basically gives a one click catalog essentially to say, here's what I actually have that I can prescribe. And it then brings clean data into the PMS and there's not all this back and forth, backs, phone calls. Hey, we actually don't do it like this. Here's, here's what we do do. So

• 19:24Speaker 05

  we've seen a lot of really good early returns with the provider portal. I think we have about 40, maybe 50 customers using it today. And we actually just talked about internally today, launching a vaccination bot because vaccination season's coming. And there are pharmacies out there that do 80% of their volume off of vaccines, right? They have clinics that they serve. They have, you know, different groups that come in and basically rely on, on the pharmacy just to,

• 19:54Speaker 05

  you know, get all their shots, you know, updated for the season. So we're working on that right now.

• 20:00Speaker 05

  There's going to be other things. There's like this whole thought, this whole sort of process around med. What is it? Med rec, med reconciliation, I think is what it is. Where pharmacist has to go in once a month and compare two charts between the months and it's hours and hours and hours of just pharmacist time. Well, now we have a bot that sort of takes care of that process because one of our partners said, hey, can you build a bot to help me do this thing? Right? So we always are hearing what's next, what would be helpful from our customers.

• 20:33Speaker 01

  I can't, I, I know, uh, I think I heard this on a podcast somewhere, but it sounds like you guys have like just a word doc of just ideas that, that are written down like this is, these are the things that we want to do or the, the ideas that we've thought of. So that's, that's really cool that you guys are getting that ingrained with pharmacy where, you know, you're hearing what, uh, people are, are wanting and you're kind of doing the build a bot, uh, situation, which is really cool.

• 20:59Speaker 05

  You, you guys know this world, right? Everybody in the pharmacy space, they like to talk. Everyone knows each other. There's Facebook groups. There's like, I don't know. As a salesperson, it's different because things are happening behind closed doors and sometimes we don't have the ability to find everything out, but you know, when you get champions and customers that want to help you and they're, they're advocates, you, you learn a lot about sort of what makes people tick and, and what their friends might want to do, right?

• 21:25Speaker 01

  Yeah, absolutely. So you mentioned that kind of build a bot, I guess, kind of structure. Walk us through like the, I guess, the anatomy of an AI bot. If a pharmacy owner is getting this kind of integrated in their system. So, you know, pharmacy owner, I guess, they contact you guys, they have a specific problem. How exactly does that, that AI bot work? Walk us through like just the anatomy of it.

• 21:51Speaker 05

  Yeah, it's changed a lot since we made these acquisitions, Austin. Like when I first started, everything for TGM Labs was custom. Right? So if you came to me as a compounding pharmacy owner, as a retail pharmacy owner, LTC specialty, whatever, we would sort of treat that as a custom situation. You're like, here's implementation fee. Here's a subscription fee. We're going to give you a pharmacist. We're going to give you an engineer and we're going to build this to your specifications, right?

• 22:20Speaker 05

  That doesn't work as you scale really fast, right? There's backlogs. There's, you know, how much headcount can we, you know, use this month to take on this number of implementations? But what we've taken from, I would say specifically the Encore X automation acquisition is Kyle built basically a bot in a box, right? For retail pharmacies, here's a retail bot. It's going to do your priority fill queue. It's going to do your cycle fills. It will short fill. And it's basically, here's this thing. We're going to plug it in. It's going to be off and running, right? So we have sort of transitioned our own business model to be a little bit more nimble and say, here's the solution for you. Like it's been a little bit more prescriptive

• 23:06Speaker 05

  than it was before. So to answer your question, if we get somebody who's a retail owner on Pioneer and I, and now we're doing on Liberty as well, we're going to say, here's a product for you and here's how it works and here's what it does. But if you come to us as a compounder, um, who's doing things, you know, sort of across the board and have a million different business rules and everything truly needs to be custom. We'll sell you a bot that can do that. So it's really, um, there, there are different options now, whereas in the past, it was sort of a one size fits all.

• 23:37Speaker 01

  Our third interview is actually a clip from the bottom line catch up featuring Scotty Sykes, Bonnie Bond and Austin Murray over at Sykes and Company. They're talking about updates to the R and D tax credit documentation. Here it is. Talk about the R and D update, Scotty. You said there's a, a new one, something new with the documentation or whatever?

• 23:55Speaker 02

  You know, we do a lot of R and D tax credits and

• 24:00Speaker 02

  the, the IRS has been postponing, uh, for a few years now. The enhanced reporting that you have to do on the form 6765, which is the tax credit, R and D tax credit form. And essentially what you're going to have to do now, um, for 26 and beyond is you have to list each individual business component. So a prescription would be a business component. If you're doing hundreds of R and D prescriptions, even though you may be spending 10 to 30 minutes on them, you know, those add up over the course of a year, right? So you may be dealing with hundreds of them. And there,

• 24:45Speaker 02

  you need to be, you know, identifying these prescriptions

• 24:50Speaker 02

  and being prepared to

• 24:54Speaker 02

  provide these prescriptions and the process of experimentation, who worked on it? What the uncertainty was, you know, you need to be able to provide that documentation. So the documentation, documentation is so key here with R and D going from, from this year going forward. It's always been a very, very important, you know, if you don't have it, you're not getting credit, but now you're going to have to actually put some of this documentation on the form itself, which has never been a requirement until now. So you're actually pretty much doing the audit for the IRS, um, when you're completing the form now.

• 25:36Speaker 03

  Which is a brilliant audit for the IRS.

• 25:40Speaker 03

  So if you ever get audited and they pull the file.

• 25:42Speaker 02

  Now, that, that being said, there might be an exemption of some sort where you may not have to put a thousand of them on there, maybe 50, or if you're below a threshold or something. So there's waiting to hear some more guidance on if there's going to be a threshold or, or a minimal requirement, but either way, the documentation pieces is definitely, um, getting enhanced with the reporting and it's been more important than ever.

• 26:09Speaker 01

  So for someone like me who, um, you know, I don't compound prescriptions, um, obviously, but, um, you know, if I'm getting it to, if I'm doing R and D documentation, you know, what does that, what does that look like now? So does that mean that I have to document every single prescription and, you know, what's included in that? Like, what is it? What does it look like now? The documentation?

• 26:34Speaker 02

  So I tell everybody that, and we're, we're, we're trying to build something for pharmacy owners to capture this documentation.

• 26:44Speaker 02

  But in real time, but essentially you need to be able to identify the prescription. But who's working on it? Who worked on it? How long they worked on it? 15 minutes, 30 minutes, an hour, whatever. What the uncertainty was like, what, what were you solving for that you weren't sure about? And then, um, what experimentation process did you, you know, we used, uh, two tablespoons of alcohol instead of one tablespoon to make the cream or whatever. So, and then that didn't work. So we, we changed it. So just a couple of sentences on the uncertainty and experimentation is, is going to be good documentation.

• 27:25Speaker 02

  And that shouldn't take a pharmacy long, a pharmacist or a, you know, your staff long. It's not intended to be,

• 27:32Speaker 02

  it's not intended to be a major burden on the business. So, you know, for example, if I'm an auditor and I go into a pharmacy and ask for the documentation and I have 200 prescriptions that have been identified, a quick list of who worked on them, a one or two sentences on the experimentation and the uncertainty, I'm, as an auditor, I'm going, all right, these, these guys have a pretty good lid on this. So you're not going to.

• 28:04Speaker 03

  I think the, the biggest thing is, is being able to, because you're going to have, you know, cross of employees that were doing regular things and then they're doing the new things. And so you, you, that's probably the hardest part. Documenting what you're doing and the changes you're making and what makes it different and new. You can do that, but then you have to start and really try to allocate their time.

• 28:23Speaker 03

  Like how much time they spend from their whole week versus what goes towards that and what goes because it's a full calculation of that. It is burdensome to a certain.

• 28:33Speaker 02

  Oh, it is burdensome, but it's not.

• 28:35Speaker 03

  Intended to be.

• 28:35Speaker 02

  Intended to be so you don't want to go overboard with it. Um, but you, you know, it is, it is. But, um, you know, to, to, to take it seriously, you need to be at a hundred and fifty to $200,000 of, of wages. Um, R and D wages. So it's like a pharmacist and a tech, you know, something like that. Um, that's, you know, you could say is, um, involved in R and D. So it's got to be a, a good amount of, of R and D work going on in a.

• 29:04Speaker 03

  And it's got to be new. It's got to be new stuff.

• 29:06Speaker 01

  Next up, a clip from peptide policy and PBMs featuring Dr. Annie West, Clinical Pharmacy Director at Atrium 24, and Day Lee, PBM and Pharmacy Practice Group Co-Chair at Buchanan Ingersoll and Rooney PC. They're talking about the recent PCAC meeting and what it means for pharmacies. We're talking about the peptide and the, uh, the information that came on the tail end of the PCAC, uh, committee meeting recap. So I guess let's start there. Um, Day and give us, whoever wants to go first, but give us an overview of what was the information that was kind of relayed, like what's new with this stuff?

• 29:49Speaker 01

  Um, you know, give us a, a 30,000 foot view of.

• 29:53Speaker 02

  And I might add, Day, you were there live, right? You were there at the, uh, the meeting there that, so you saw it all go down. Give us an update there. Uh, start with Day.

• 30:04Speaker 06

  Yeah. I mean, that two day event, July 23rd and 24th.

• 30:12Speaker 06

  Definitely well over 100, 150 folks in the room. Um, very large conference room in the FDA campus in Maryland. Heated, heated, um, arguments on both sides, right? The, uh, proponents as well as the, um, let go better words, the, um, opposition or haters of the, uh, peptides in the industry. Um, so the, the event was very long. Day one, uh, started around, I mean, started on the dot 8:00 AM, ended well after 6:00 PM. Day two, uh, started at 8:00 AM, probably ended after 4:00 PM, uh, close to 5:00 PM.

• 30:58Speaker 06

  Uh, there are, there were exchanges between the proponents and oppositions, uh, or, you know, on the clinical safety and efficacy, but also a lot of discussion on the policy

• 31:14Speaker 06

  uh, aspect of the peptide. So what happened at the end of the day, the day two was that the FDA Pharmacy Compounding Advisory Committee recommended six out of seven peptides to be added to the 503A bulk list. Uh, day one, they discussed BPC 157, KPV, TB 500, MOC. Day two, Emy Delta, Pitalone and Cmax. And Emy Delta was the only one, uh, that was not recommended to be added to the 503A bulk list. Now, to be clear, these peptides, the six peptides have not been added.

• 31:59Speaker 06

  It's up to the FDA. Um, there will be comment and rulemaking process. Who know how long it's going to take? Um, could be months, could be years. Um, FDA may, you know, as they did in a traditional sense, go with what the committee actually recommended. Um, but, you know, FDA may not ultimately follow the, uh, committee's recommendation.

• 32:30Speaker 02

  Historically, they do follow the committee recommendation, correct?

• 32:34Speaker 06

  Yes, historically they do. FDA does follow, but in rare instances, uh, that they have not followed are high state cases. And I consider peptides to be high state case.

• 32:50Speaker 02

  Good point.

• 32:52Speaker 06

  But at the same time, you know, you see, I mean, at the same time as we speak right now, you could go online, buy these peptides from gray market, you know, sellers. Yeah. Nobody know what's in it, but you could buy it.

• 33:08Speaker 02

  I feel like I was in the room there, Day, as you went over that. Get to my next question because Anne, I know, you know, you guys and Nicolette are working on

• 33:19Speaker 02

  how, how pharmacies can learn about it, uh, learn about this stuff, eventually roll it out, implement it, you know, and adopt these peptides in a meaningful way for their patients. What, what, what can pharmacies do now in this period of wait, I guess, until there's comments and the FDA makes some decisions? What, what can pharmacies do now in terms of getting ready for, uh, for this potentially opening up for them? And we're talking retail pharmacies who do not compound. You know, are there going to be opportunities for them? Um, and of course, compounders as well?

• 33:59Speaker 07

  Yep. So there's going to be, there's opportunities for everybody there. And, and that's such a good point, Scotty, because, you know, we've been like, it's been a couple of months where we're, we want our pharmacies, you know, to already be educated because you're already getting patients asking about it. Like Day brought up in the very beginning, these patients are already using them. And they want to come to their pharmacist, right? They want to ask the person who, who they trust. Um, but traditionally in pharmacy school, we did not learn about these types of things. And, um, honestly, there's been such a big shift recently in the way that patients are thinking about their healthcare. Um, I really think that changed with COVID. It changed with the GLPs. It changed with telehealth. So now,

• 34:42Speaker 07

  um, we have just a huge influx of patients that are really thinking about, uh, like, uh, longevity. How do I make myself actually healthier? Um, so there's just so many patients that are already asking about it, but I'd say now is really the time, um, where you really need to dig in and you need to do some education on that. Um, so what we are putting together, uh, is an entire course on it. So we're breaking it into two modules. Uh, module one is really going to be that kind of educational piece. Um, so we're going to really cover all the clinical aspects of these peptides. And in addition, the ones that are, you already can compound like Smorlin and Glutathione.

• 35:23Speaker 07

  Um, and the GLPs, if you're getting them through, um, you know, patient specific prescriptions. Um, so we're going to go through peptide fundamentals. What are they? What are the different ways they can function within the body? Um, we're going to go over some kind of lifestyle factors so that you can help support your patients, not just give them the drug and say, you know, this is going to make you healthy, but what's really going to help support them long-term? Um, and then a clinical review, uh, of these peptides broken down by class. So that way it's a little bit easier, um, to understand, uh, and remember what these, uh, peptides are proposed, um, to be used for. So we'll go through like the big ones like regenerative medicine and immune health, weight and metabolic health,

• 36:06Speaker 07

  um, sexual health and fertility, neurology and cognitive health. Um, there's so many great benefits to these peptides that we want to make sure that our pharmacies feel comfortable with the knowledge that they need in the background to, um, to really help with their patients, kind of understanding what are some common monitoring parameters or side effects, or, or even what kind of patient populations would each, um, peptide be really good for? And then the second module, which we're going to be releasing is kind of that implementation piece. So exactly that where, um, can I do this if I'm just a regular retail pharmacy?

• 36:44Speaker 07

  Uh, and your answer is going to be yes, there. There's, um, you know, central fill, which you could do it, um, coming from another 503A pharmacy. We're also expecting these peptides to be available from 503Bs as well, which is a, you know, another topic of discussion entirely, but we think the industry will also move that way. Um, and then kind of just understanding how would you set that up in your pharmacy and, and the tools to really be able to implement it? Um, so you can start providing it to your patients. But that first piece, the, the clinical education piece, I think right now is the most important. Uh, because you do need that basis, uh, you know, before you really bring them into your pharmacy.

• 37:26Speaker 07

  And I, I, we still have a pre-sale going on. Um, so I think, I think I'm able to share with, with the podcasters out there too, but we do have a discount code, uh, peptide 20 going on, I think until the 11th. So I'm not sure what day this will actually go out Austin, but, um, I'm sure we can also get it extended if we want. Uh, but you can always reach out to us. I'm sure we'll go over it at the end, but hello at Atrium 24.

• 37:54Speaker 07

  If you have any interest in that and, uh, or if you want any additional information.

• 37:58Speaker 01

  Our last clip comes from understanding basis featuring Alan Sykes at Sykes and Company. He talks about how basis builds over time and what gain on a sale actually comes down to in a pharmacy. Check it out. We've gotten this question a lot, which is the concept of basis. Um, so Alan, give us an overview. What is basis, uh, for owners and, you know, why is it important? Why does it matter? Um, what are some things to consider when it comes to, uh, to basis? Yeah, basis is a pretty simple topic, uh, yet it can be very complicated. But as an owner, it's essentially what you have invested into the pharmacy itself.

• 38:44Speaker 01

  So if you assume you have an S corporation, which is an entity that passes through the profits and the losses of the entity back to the, uh, shareholders in proportion of the shares that they own. You obviously have made probably at some point in time, an initial investment. Uh, you may have loaned the entity some monies over time that are actually owed to you directly. That can also have an effect on your, uh, income tax basis as well. You obviously have earnings and distributions.

• 39:19Speaker 05

  And losses potentially over a period of years. And essentially basis is a running total of what you've invested, what you've earned, what you've lost net, what net, what have net, net of the losses that you've incurred, net of the distributions that you've taken out. And then if money has been loaned to the business directly, not indirectly by just signing a note as a guarantor, but directly lending money to the entity. That adds, that adds to that basis as well in dealing particularly with an escopration.

• 39:59Speaker 05

  And obviously, when an entity is sold, that basis becomes very important because your gain is the difference between what you receive less that cumulative basis that you've had over a period of years. Pretty simple concept.

• 40:18Speaker 01

  So if I'm buying a pharmacy, that step up in basis is something that I'm going to be heavily considering. Um, with the, I guess with, you know, when it comes to, comes to the sale there, when I'm, when I'm buying the pharmacy, because there are certain assets that I'm going to get that step up in, in basis.

• 40:38Speaker 05

  Well, obviously, if, if you're, if you're the buyer, your basis in the assets, if you're buying assets, is going to be what you pay for those assets. But if I'm the seller, my basis in the entity as a whole is going to be my cumulative money that I've, again, invested, earned, less distributed, less distributions I've pulled out, less losses, less direct loans that I've had directly into the business. So my basis on the entity's assets, the entity as a whole is just that. You as the buyer will get a step up or a new basis for what you pay

• 41:23Speaker 05

  or either the stock of that entity that you buy from me or the individual assets if you're purchasing, if you're purchasing and cherry picking on certain assets on the buying side.