Delivering Prescriptions | Kunal Vyas, RxMile

Speech to text:

Mike Koelzer, Host: [00:00:25] Kunal for those that haven't come across you online, introduce yourself and tell our listeners what we're talking about today. 

Kunal Vyas: My name is Kunal Vyas. I am the CEO and co-founder for RxMile . And we're talking about prescription home delivery, the last mile delivery, which is the most key component in, uh, pharmacy.

And the majority of pharmacies do provide this type of service in some form or manner. And we've built a platform that can help them in whichever way they decide to utilize it. 

Mike Koelzer, Host: I like those miles in your name because those are the tricky ones. I mean, anybody can move something across the country, but when it comes to, uh, helping Mrs.

Johnson , you know, gets to her side door versus her front door and leaves it in the turtle statue on the back porch or something like that, that's where everything breaks down. And that's where it gets D. 

Kunal Vyas: Yes exactly. Um, for most pharmacies, when they use our platform, there's an individual case per patient being delivered to, for example, one may require an adult photo ID.

Another package may not require an ID, just a picture that was left at the door for verification. Um, some may require signatures. Um, it, it all depends, you know, leave it at the back door in, in, on the porch. Um, leave it underneath the chair. A lot of communication when it comes to the last mile, communication is key.

Mike Koelzer, Host: And in your case, being in Orlando, Florida, you might even put down, like watch out for the alligators or something. 

Kunal Vyas: um, well, not so much more like porch pirates is porch pirate, 

Mike Koelzer, Host: getting worse. 

Kunal Vyas: Um, I think with the ring video doorbell, it got a lot better as far as people are a little bit thinking twice about it, but, um, it was, it was pretty bad before that 

Mike Koelzer, Host: looking at your LinkedIn, you've been in the courier service, how did your interest in that start way 

Kunal Vyas: back?

My family is pretty big in the Orlando market, in the, uh, the MSO space, which is a managed service organization. Uh, we owned a group here in central Florida, which was. Servicing about 30,000 managed care, uh, a P D 

Mike Koelzer, Host: lives servicing them with delivery, or you mean health 

Kunal Vyas: wise servicing them as far as their doctor network, the primary care doctor, it was kind of like we're at full risk.

These are our patients. We have to serve them. We have to make sure they're coming in to see the doctor they're adherent to, to their medication regimen, things like that, to keep them out of the hospital, to keep them compliant and keep them healthy. 

Mike Koelzer, Host: Wait a minute. What do you mean your family did this?

Kunal Vyas: My family, my uncle. So he was the owner of a family physicians group, which was a large MSO here in Orlando. Recently it has been sold to Humana. Was he a healthcare provider? So my aunt was, and we had about 155 doctors that worked for our group. Wow. How I came into the space was I was just about to go into college and my uncle approached me and said, look, we're growing significantly here.

We're opening 22 medical centers. We're gonna have hundreds of doctors. Um, we actually need to open a pharmacy to service these patients and mind you, this was way before there were any HE'S part D quality measures. This is when there was no such thing as a patient centered medical home, but my uncle, you know, he was thinking forward in regards to creating a pharmacy too.

Not more of a profit center, but to help with keeping the cost down for the real profit center, which was the doctor group. So I just, you know, decided to get my pharmacy technician license. So I could actually understand what I was walking into. My background has always been marketing. So I did approach a lot of these doctors kind of understanding exactly the economics in regards to, you know, part D cost, um, part a as far as hospitalizations readmissions, and we were able to kind of drive a lot of patients with the opportunity.

Hey, you can have your medications delivered to your home versus utilizing a chain pharmacy or whatnot. This is, uh, an option that you have. We had a lot of patients that decided to take that option. And, um, from there. You know, we were, we were using, uh, courier companies and it was just a total nightmare. You know, we had doctors, there were like, you guys do a horrible job.

My patient says the medication was thrown over the fence or the person didn't wait for the patient to come. So I told my uncle, I'm like, I think that we should handle the logistics ourselves. I'm gonna create a logistics company. One of my good friends [00:05:25] from Orlando, Florida was working, uh, on the west coast back with, uh, with Microsoft in Seattle.

Um, smart guy engineer, you know, full stack engineer. And I said to him, you know, Hey, I need help. Uh, I need to figure out how to create a label. And it started with the Excel spreadsheet. And from there, uh, I need to do this. I need to get signatures like before I even did it. I was using five different components.

I had to have one component to optimize my routes, one component to get a signature, another one to navigate the driver, um, print a label. So that was the start of me beginning to build, um, RX mile, um, as far as a platform, more for the necessity of me to be able to service these patients. Uh, and that's kind of how I got into logistics.

So it started off with me going into pharmacy without even knowing I'm getting into it. And then understanding and learning. And it's been, I would say 15 years now, um, that I've been in the industry, learned a lot of things along the way with owning a pharmacy and a logistics company and kind of running them side by side.

Mike Koelzer, Host: What was your decision to start a company versus just say, Hey, ink, I'll just come in as an employee and we'll get delivery going. Is it true that you actually started a company to do that? Or did that come a little bit later? That's 

Kunal Vyas: Actually how it started. Right? So just to separate for liability reasons, we had to create a different company.

So it wasn't tied strictly into the pharmacy per. Um, but that's how it started. It was literally just for my pharmacy to provide the services. But as we grew along, built out the technology, you know, and all the different bells and, uh, whistles that we added and features, which really helped us with things like auditing tenures, worth of record, keeping compliance records.

Um, I decided when I sold the pharmacy in 2019, that I'm gonna take this, uh, this logistics company, which is called deliver stat, and I'm gonna provide this service to other independent pharmacies out there, here in the state of Florida. Um, so that's kind of how I got into that. I learned a lot in doing that, um, where we were out there marketing and, and it kind of, I figured out there was a 40, 40, 20 rule here.

Um, and what I mean by that is we know there's 19 to 20,000 independent pharmacies throughout the us. Um, and from what I saw Florida is probably the third largest market. So. As we were approaching for delivery service, I noticed that 40% of these pharmacies are smaller mom and pops and they have their own driver and they're maybe doing 10, maybe 15 at the most deliveries per day.

And it just made more sense for them to do that because, you know, it is more cost effective. It might be their nephew or retired veteran or somebody in the community. The other 40% were, especially in the Miami area, pharmacies that were doing massive volume, like 3, 4, 500 up to a thousand packages a day.

And they had the density to have their own in-house drivers also to keep their costs down, have more control. And from there I realized, well, really there's only 20% of this market who could really utilize a courier service type of thing. And that was our focus more on enterprise accounts. So we did focus on a lot more enterprise accounts.

The people that can afford the six, seven, $8 a package delivery, you know, still a little cheaper than FedEx, but, um, but a little higher than if they did it in house. Where they might be paying three, $4 per delivery with their own drivers. What 

Mike Koelzer, Host: Does that mean? Enterprise 

Kunal Vyas: account enterprise account. So we have a contract with V OS.

Um, we have a contract with large MSOs that are more, not just, let's say independent pharmacies, but they're really, they're a part of a bigger group, like a health group. You 

Mike Koelzer, Host: mean like a bigger organization? 

Kunal Vyas: Yeah. A bigger organization versus just a small, independent pharmacy. Like they're just a component of the whole medical center.

So we decided to kind of focus on that market. But at the same time, I decided, you know, this platform that we built let's, let's bifurcate the technology. Let's create a company called, which is RX mile and. Now offer that out throughout the United States, uh, to people. So they have the tools and solutions I had when I was owning my pharmacy to do it in house, have my own drivers, keep it cost effective and compliant.

Um, you know, there's a lot of PBM contracts, which forbid third party delivery or, uh, over 50 mile delivery. So, you know, that's kind of [00:10:25] what we developed to help with independent pharmacy owners to utilize. Um, there's also other third party integrations with partners in case they do need to outsource, but RX, Mile's kind of like a full fledged delivery prescription delivery platform.

Whether you want to do it with your own drivers, you need to outsource it for a same day or emergency, or you want to outsource to a local carrier for the next day. So it's kind of like having it the way you want it. Kind of control the cost. We always promote for them to utilize the in-house because that's where they can keep their cost at the most minimal.

Go back 

Mike Koelzer, Host: to your comment on saying that you did it for liability reasons. When you started the, a company originally, what liabilities were you trying to 

Kunal Vyas: separate? The pharmacy is, you know, a much bigger organization. We had about 50 employees. We're doing 18 million ARR and, you know, the logistics company being separate, let's say a driver in the logistics company, God forbid gets in a car accident and, and something, you know, fatal happens to somebody that could in turn.

Fall back onto the other entity, which would be the pharmacy. That's why a lot of these independent pharmacy owners outsource their deliveries to not have the liability on them versus the courier company, which is fully insured. And they have the umbrella policy and they're paying that super rate in regards to, uh, their insurance costs because they're not only covering themselves like us, for example, deliver stat, we're covering ourselves with our own internal drivers that may work for us.

And then outsource 10 99 contractors also through our umbrella policy. So to answer your question, it was separating the two entities because there were two separate types of companies. I don't 

Mike Koelzer, Host: I think most pharmacies, maybe I'm all wet on this. I don't think that most independent pharmacies have done that for their delivery portion.

How did you know that? Did someone give you advice from the start and say, Hey, if we're gonna deliver, we want to keep these separate. 

Kunal Vyas: Yeah. I mean, my uncle obviously made sure that it was done. I heard a horror story. One time with the independent pharmacy driver, getting into a car accident. And now that whole pharmacy was getting sued by the actions of that 10 99 contractor, who wasn't even an employee of the pharmacy.

So, you know, sometimes they don't want the headache and they just outsource it. Some people will get a commercial insurance policy. Let's say if the driver is using their own vehicle, some people skate around it. But you know, at the end of the day, you don't want to take that risk. What's a 

Mike Koelzer, Host: downside of a pharmacy of every pharmacy listening.

Now, setting up an LLC for their delivery portion of the pharmacy. Any downside to that? Uh, 

Kunal Vyas: no downside just separating the two entities. Um, You know, depending on how they pay their drivers, if they turn them into employees or their contractors, it, it, it depends on the way they structure that. But there wouldn't be any, I mean, maybe the, the cost of filing for it, stuff like that.

Um, but I don't see any downside. I think that's actually a smart move to do. If you're gonna be doing it yourself with your own drivers 

Mike Koelzer, Host: delivery has always been a kind of a strange thing for me, because I've never known how much to market it, cuz it's like, if I market it, I might get more deliveries and I'm never sure exactly what the profit is and stuff like 

Kunal Vyas: that.

Well, I'll tell you what, so I, I will tell this to everybody. I said, name me any other. Industry here other than independent pharmacies that provide free home delivery. And you, you can't answer that. Right. What, you know, even if you're getting a pizza, there's a delivery fee baked into it. Yeah. 

Mike Koelzer, Host: Now there's a fee and they say, this is not a tip there there's 

Kunal Vyas: always a fee baked in you, you, you can't bake in a fee on a copay.

Right. So when these pharmacies are offering this free delivery to their patients, it's kind of like they have to, in order to compete. Unfortunately, we just went through this pandemic and COVID has really, you know, accelerated that change, you know? Um, whereas people don't really want to go and wait in the line no more.

Did you, you know, prior to COVID, did we ever think CVS and Walgreens would offer delivery and be okay to lose front end foot traffic? Right. But today they're doing it because they have to, because you know, it's a catch 22. They don't want to promote it as much, but they gotta offer it because that's just.

the world we live in today and I tell independent pharmacies, I'm like, you guys need to leverage what you've been doing for decades. We have so many digital pharmacy startup companies out there that are raising millions of funding. And they're [00:15:25] harping on something that these independent mom and pops have been doing for decades, which is free home delivery.

You know, there's, we should leverage that, right. Uber spent billions of dollars to build a network of drivers throughout this country. These independent pharmacies gotta understand. You guys have built that network too, right? 10,000 plus 20,000. They all have their drivers. They're doing delivery individually.

You're not that valuable, but as a group, there's a real value there. 

Mike Koelzer, Host: I think all those companies that have popped up, you'll see like an app. And it'll say, you know, this new national pharmacy, they've got this real simple app. It looks really nice and clean. And they've raised, you know, millions of dollars from investors.

I think those investors had the wool pulled over their eyes. I look at this stuff and I'm like, how hard is this to duplicate? It's not very hard. I don't know why they're getting such value. You think it's because there's just too much investment money around and they gotta put it somewhere 

Kunal Vyas: Uh, because they pulled wool over their eyes.

And I'll explain to you what I mean by that. Okay. Today, right now, these investors that are investing into these startups, the majority of them, 95% is a B to C use case, right? They're expecting, you know, maybe the baby boomers will start utilizing, but when is the last time that you sent a prescription over to a pharmacy?

99% of prescriptions are sent by the physician. So when you have a B2C model where you're expecting people to go download an app, put their billing information in their insurance information, put their script info in and send it. I just think like that's, that's not the play. The play is about the relationship between the doctors who actually send the script through EMR or EHR to the pharmacies and the pharmacies are the ones who are providing the delivery, but you know, how do you expect.

To you're in an industry where you might average maybe a three to four, maybe if you're lucky, 5% net net, and you're raising millions and millions of funding to build a team of developers to develop what, you know, there's so much technology you can build, the human touch will never go away. And that's what independent pharmacies can do.

They keep communicating. The patient is not just the number. They know them by their name. Now, these digital startups that are out there, they got the, you know, they, they, they got the idea right where, Hey, let's offer free same day delivery with the two hour timeframe. Right. But all they're doing from what I'm seeing is they're, they're using millions and millions of funding to affect, not the chains in the supermarkets.

They're affecting the independent pharmacy owner and driving business to them. And they have a bad experience. And then they go right back to the, to the independent pharmacy that's providing the delivery. So. Yeah. I, I just think that you can't be in a business where your margin is net 3% and then have a whole development team.

It's a pharmacy. It's not a technology company. 

Mike Koelzer, Host: Everybody sits back and looks at, let's say, Instagram, if you looked on your phone at companies like Instagram, for example, you know, which Facebook bought for a billion bucks or something. If you look at those, there are hundreds of those companies and there's only one leader.

And you can say the same for Amazon as one leader, you know, maybe Walmart and a couple other ones, maybe one will take off, but not a hundred with all these different people tossing 

Kunal Vyas: money at it. Well, I'll tell you what, right? In our industry, there's a fix and you know what? I have a positive outlook based on the way things are going right now with the FTC probe.

You know, we have Mr. Alva, who's joined the commission. Um, I think there might be transparency coming down the line, but to answer your question. These digital startups are here to disrupt the industry. How do you disrupt the industry when the person you're trying to disrupt is your payer, CVS Caremark express scripts, OptumRx.

Those are the, those are what, 80% of the payers for as far as PBMs in the country. So I, I, I just don't see, you know, Amazon did try, Amazon came out there and they were planning to, you know, from, from where they are to where they wanted to be. They've failed in a sense right now. Um, Mr. Cuban has come now with them, but this is a little different because it's all cash paying and not any insurance involved, but until the FTC helps them out , it's gonna be very difficult to disrupt the industry.

When the payer is the one who's paying you, that you're trying to disrupt, 

Mike Koelzer, Host: you've got. 80% are paying or 90%. And the rest are little old ladies who don't know how to turn a phone on. I mean, I don't think the market's there for that kind of money that's gone into it. 

Kunal Vyas: Yeah. I, I, I don't think so either the independent pharmacy has been a key component in, uh, working directly in their communities with the [00:20:25] physicians, with the specialists.

That relationship is kind of being severed, um, by the bigger players in there, right? Forcing mail order, steering people to that I'm telling, you know, some insurances you can only use CVS or Walgreens and whatnot. So, you know, I've spoken to a lot of pharmacy owners. I have a lot of friends in the pharmacy industry, and I can understand that they have a real negative outlook just because of the last decade, how things have been.

But I always tell them, I said, look, Let's think positive, right? Things are going somewhat in the right direction. We have the, you know, the FTC now looking into this. There's people in the house and the Senate, which are trying to make a change here. I get that we've been trying, but we haven't reached this point ever.

So, you know, I, I, I feel that, you know, I understand the plight, but yeah, let's be positive. 

Mike Koelzer, Host: One of my team members asked me how important it was for our state, for example, Michigan, to have new PBM laws. And I said, it's good. You know, the prices are still gonna suck, but at least it. Took away some of the opaqueness, at least it's more clear for then the next round of laws, the politicians to say, oh, we understood your plate.

Now in five minutes, instead of, you know, five weeks, it was just hard to understand before. So you still might be getting screwed, but at least people can see you getting screwed and then they understand it 

more. 

Kunal Vyas: Exactly. Exactly. Two, three years ago, nobody knew what a PBM was. Um, now, uh, you know, people who don't even know our industry know what a PBM is because of all the, all the news that's come out about them all, you know, that they're being, you know, there's a big, bright, light shining on them right now.

You know, don't get me wrong. They have a place. And the place was, you know, to negotiate and, and get that little three to 5 cent transaction for every transaction. , that's what they used to be. So, you know, but now they're, you know, took a different, uh, turn, you know, the other thing is mail order pharmacy, you know, I've so many horror stories with mail order.

Pharmacy veterans are forced to utilize it. Medicare advantage patients are told they need to utilize it. You know, one has fought for our country. The other one has, you know, worked 15 years plus paid their taxes. And now they're entitled to Medicare advantage after they're reaching 65, but then they have no choice.

They're told you have to use a mail order, whether it's delayed, whether it's a placebo effect, cuz it's sat in a mailbox at 140 degrees for three days before you decided to go pick it up. Uh, it doesn't matter. This is just, you know, to me it's penny wise, pound foolish. Um, because. Patients should have a choice.

If they want to talk to Bob, the pharmacist across the street, the same way that they want to go and buy Publix, they want to go and buy their milk from Publix. You know what I'm saying? He's like, you can't just, just tell people, no, this is the way it is. And there's no other choice. And, and I, I feel that the independent pharmacist's been through so much that things are gonna start getting a little better for us.

I feel. 

Mike Koelzer, Host: What is your worst negative emotion dealing with your current state, with your company and so on? Is it overconfidence? Is it anxiety? Is it depression? Is it fear? What is your strongest negative emotion in the last year? You know, working with this? 

Kunal Vyas: So I would say anxiety, um, would probably play a role for me in that sense.

Um, and you know, that, that, that just comes with. You know, starting a new company and, and, and, and, and understanding what it takes and going through the ups and downs, you know, with, with my company delivers that, you know, we, right, when we went live, we, you know, we shot out of a cannon. We got a contract with vetoes hospice in south Florida to service the whole Jupiter to homestead, which is 150 mile radius, and everything looked great.

And we grew so fast, organically, and bam, I made the biggest mistake. I decided to grow throughout the whole state of Florida versus focusing on a certain part of Florida. So, you know, you know, at that point it was almost like we went up to 1.2 million ARR to 2.2 million, and then all of a sudden. We gotta sit back and think, what are we doing right here?

What are we doing? Just cause our service, uh, we are trying to provide service. We don't want all, all business is not good business. Um, and I learned that very fast. 

Mike Koelzer, Host: You say? Well, I probably should have maybe kept it closer. Could you have picked up the business so closely? What other business would you have picked up [00:25:25] closer to grow your business, but keep it 

Kunal Vyas: closer.

So when I started right, I was wet behind the years. Um, I had a, you know, the eight largest, uh, city is Miami, right. And we are in Miami, we're doing a lot of volume business in Miami. And then I'm like, oh, we have an opportunity in Orlando. We have an opportunity in Jacksonville. We have an opportunity in Atlanta.

Let's take it. Um, the opportunity is not always what it seems. Number one. And number two is, you know, you gotta crawl before you walk. Um, granted, now I've learned from my mistakes in that sense. And, uh, we are like, we, we are doing so much volume in south Florida is amazing with that company. Um, but I did also learn a lot in regards to what my fellow pharmacy owners out there really need.

But what else 

Mike Koelzer, Host: would you have done if you say I shouldn't have expanded so much, could you have grown your business closer by just picking up new 

Kunal Vyas: people? Yes. I would've done what I'm doing right now. We're expanding in the south Florida market with that company. And you know, there's so much business to 

Mike Koelzer, Host: You jumped to another city.

You should have expanded a little bit, but you should have done it connected to where you are versus jumping. Yes. Yes. You jumped to the epicenter of some other city when you should have just expanded versus jumping a hundred percent. That's a hard decision though, because when you're in the epicenter, patients are more compact.

As you start getting out of the city. They're fewer and farther between. I can see the temptation to wanna jump to a new center somewhere. 

Kunal Vyas: Yeah, well, you know, it is, you know, when you have investors invested and stuff and you just wanna show that super growth, so you can continue to kind of make them feel like they've made the right decision.

And, you know, I sat down and had a conversation with them and told them, look, this is, this is, uh, this is a marathon. It's not a sprint. Um, so we need to, you know, pull back. Grow within and then understand how to do it the right way. You know, I always tell people don't think about how to own the market, learn how to own the margin.

Then you can maybe own the market. Cause not all of us are Uber where we've got, uh, uh, hundreds of billions of dollars to burn. . 

Mike Koelzer, Host: Speaking of investors, RX mile is. All you, or do you have investors or partners or 

Kunal Vyas: anything? So RX mile, um, my majority ownership is between me and my partner, who is the CIO, the developer, the one who engineered and, uh, built the platform.

And, uh, we do have some, uh, uh, seed investment round that we just, uh, raised recently of a few doctors here, uh, in, in Florida that I've known family, friends type around. Um, I don't, I don't feel we need to, uh, really, you know, again, this is a little different, right? Because delivering that is more of a fulfillment.

You gotta have hub insurance drivers, all that, whereas with this company is more, is just software and support. So I don't want to give too much. Uh, a way in a sense, right? I wanna first go out there and, and try to generate what I can with, uh, with what we have, you know, and, but, um, eventually to kind of grow it out in nationwide, you know, this, this product could be used anywhere, you know, Canada, Europe, you know, at that point we would probably need to look at, uh, maybe a series a round, but that's it, I'm not trying to do B, C, D E, and then burn all the investors money.

Mike Koelzer, Host: What's your biggest bottleneck right now? If you have one, I guess any business has some bottleneck. Is it your energy, your time finding the customers, having the money, the marketing, where would you say a bottleneck is to any growth that you're not having? I'm not saying you don't have it. I'm just saying if there is a bottleneck, where is it?

Kunal Vyas: So I would say my bottleneck right now is, um, personnel. Um, we, we, we have a great product and we want to get it out there in the market and find good people, uh, to help with going out there and promoting it. Like, I'm, I'll be honest with you, Mike. Um, we just launched in March, right? And I won't let anybody take a demo.

I'm taking 'em all because you know, I, I want to meet the customer. I want to understand their pain points. I want to know, you know, if what we have even works for them or not. Um, and that, I feel that if I put that in somebody else's hand that they're gonna come very, come off, very salesy, you know, like pushy and sales.

And, and that's not the point here. The, you know, it's not a, it is not a product that I'm saying, Hey, you need to use this and pay me your fee to use it. What are you doing right now? Can this help you? Why don't you try it out? If it works, it works. If it doesn't, it doesn't, but we have bigger plans. If we can build a big network of independent pharmacies utilizing this, you can open up other doors.

So I'm the bottleneck. Put it that way. I need to learn how to, uh, delegate a little bit more or, or, or. [00:30:25] Let go, as people would say, and not be such a kind of control freak like I have with the other company, but with RX mile, I kind of feel like, yeah, that's probably I'm the bottleneck. 

Mike Koelzer, Host: I imagine the value of doing your own demos.

For example, I imagine part of that is how you do it, but I imagine you get a ton of. Feedback a ton of amazing feedback information from these people that I don't know if that would get to you the same way. Exactly. If you had someone else, they might just say, Nope, we don't have that feature. And then go on.

Where if you hear that a few times you might piece something together in your head. Exactly. 

Kunal Vyas: You're absolutely right. Um, I don't wanna miss any of the conversation, you know, I, I want, you know, if, if, if it is a client who could utilize our services or our software could work for them, I want to know their pain points.

And I think the best way to do that is by communicating, um, you know, a lot of people say, Hey, you look like a small company because you know, you put out a post, Hey, have a, have a zoom meeting with the CEO and founder. Now you look small. I'm like, I don't care. You know, it's fine. I mean, I actually want to have that meeting.

I want to speak to them. Right. Uh, but then you don't look like a big company when you're trying to re I'm not into that. You know, it's not about the fluff yet. It's about. Market fit. It's about people who need something that could work for them and seeing if, if it isn't, how can I adapt to fix it or to make it be, you know, we're customized technology.

My partner can, can customize based on what, uh, long term care facility type of pharmacy, you know, sending 30 things to one location we need identification for, you know, depending on what it is. 

Mike Koelzer, Host: I won't reveal this person, but it's a person rather close to me and he's got a company in one part of the country and there's this other person that.

Has a apartment in another part of the country. So that's their second mailing address. And all they do is someone mails it to them. He just turns around and sends it to this guy, you know? And then all of his phone extensions are like one person in the company. All the phone extensions are like three oh two and 4 38 

Kunal Vyas: and is all going to one place.

Mike Koelzer, Host: I'll joke with him. You know, he picks up the phone and then he changes his voice and things like that. So for now there's an author out, his name is Michael Gerber and he wrote this book, the E myth, and he talks about how in a newer business. You're wearing a ton of hats. One of the important things to do is start labeling those hats.

When you want to maybe stop doing less work, at least you have those functions set up and you have some of the job description written down and so on. If you had like five people in your company now, and they were all executives, what would you like to have? Would you be ahead of marketing? Would you have ahead of this ahead of that?

Well, what would you have if you had like five big shots in your company right now? 

Kunal Vyas: Uh, I would say marketing and sales would be the first two most important things. Um, somebody, you know, uh, who, who can head the sales part, the marketing part, you know, a customer success type of thing. Somebody who communicates with the customers, you know, keeps, you know, that 30 day, you know, once every 30 days communication seeing if there's any enhancements or updates and things needed CFO to manage.

All that, which, you know, I, I I'm, I'm, I'm the CEO, so I'm not that I would think that, um, and, and, and, and a real powerful CEO who I believe, you know, has got a background, not per se in logistics, but more per se in pharmacy. Um, so they understand the lingo. They understand, you know, what a person is asking for, and they understand why that pharmacy needs this type of reporting, because the physician group they're working with, or, you know, so that, that would be four.

And then the fifth one, I would say would be, you know, HR, you know, human resources, somebody who is. There for these people, for the employees, for the drivers, you know, in, in our case it wouldn't be drivers, it would just be pharmacies. Right. Um, but, um, development is, is, is obviously key. My partner, you know, having somebody, you know, to help with that, a CTO position instead of, you know, just a C I position.

But yeah, I mean, that would be kind of that kind of spearheads, I believe every single component, 

Mike Koelzer, Host: if you had an unlimited marketing budget and let's think about some of the things that are available to pharmacy companies, whether it's online, whether it's magazine, whether it's a salesperson, whether it's a pharmacy convention, whether it's [00:35:25] underwriting.

You know, pharmacy awards or something like that. Where would you break up that percentage of those things I mentioned, and maybe you have a ton of other things too. Where do you think your biggest impact would be for RX mile in getting customers then out of those different marketing pathways? 

Kunal Vyas: So, um, I know that the world we live in today, digital marketing is key, right?

Um, building a digital footprint, I agree a hundred percent. And I do a lot of it through my LinkedIn page. Um, you know, we do some through our business, LinkedIn page, Facebook page and all that. But you know, you always gotta look at the factor of what you're marketing and who you're marketing to. So for me, the ground game is most important.

I would want one sales marketing rep that understands pharmacy, preferably somebody who's worked in this space, uh, maybe a sales rep from McKesson or some or Ameri sources I would want. Boots on the ground. I would want somebody who can physically go and visit these people because you, you know, the digital marketing game is amazing and cool.

You know, I get, I get some Calendar invites and I do the meetings and we close the client. But you know, these people are, is, are again, is that touch right? There is somebody walking in there who understands what they need and sees what they're doing. And if there's any pain points that we can do to help fix it, you know, they might walk out and say, you got this thing down packed.

You don't even need us, you know, but, um, you know, if they're using my technology, that could be true. but you know, you know, we, we, we have many clients that use a lot of the, you know, a lot of the pharmacy software platforms have a lot of delivery modules, you know, pioneer. We work with them, we're integrated with, uh, put some of them, Liberty pioneer, FSI.

Um, we just kind of, uh, show them. You know, it's a little bit more intense as far as, um, the route optimizing the live tracking for the patients, a physician portal. For example, if the physicians want full transparency, you're talking about at the point of care, putting a prescription through an EMR patient receives a text message or a link of their medication to track.

They drive home and then it's delivered. Um, that's the real deal. That's that? That's some service today. I always tell people, you know, I guarantee you nobody's offering that service right now in a doctor's office today. Have you been in your doctor's office where they're telling you, you want your meds delivered for free within two hours, you say yes.

And all of a sudden you get a link which tracks your package live and you get home and it's there. That's, that's, that's the ultimate goal and game plan. 

Mike Koelzer, Host: It's important for leaders like you to give a vision. Of what can happen more. And what I mean by that is most people, 40 years ago, didn't say, oh, I've got this eight track cassette tape someday.

I wanna have a five inch laserdisc. You know, people didn't think that they had needs maybe, but they didn't know what the hell it was gonna look like at all. And so a lot of times I imagine pharmacies, they think they have it all under control. It's like a canal. I don't need you. You know? Mrs. Jones gets her medicine.

She says when she needs it, it's like, yeah, but. Does the doctor know that she got it? He was worried that Mrs. Jones wasn't actually gonna take their medicine. And now he gets alerted that she now has her medicine in her home. You know, that kind of stuff that it's like, oh, we didn't think about that. You know?

So there's all kinds of ideas that you can bring to the table that pharmacists. Didn't think about it just as much as someone with a vinyl record thought about a five inch laserdisc. 

Kunal Vyas: Yeah. I mean, I have a good friend of mine, Dr. Lecky. He works with CVS in the south Florida market. And, um, he says, the majority of the calls he's getting are from, you know, physicians saying, Hey, did that patient pick up the script?

They're not even calling about giving a script. They're calling to find out if the patient picked up the script, right. And it is always around the end of the month when they gotta reach their quality measures, make sure they reach their 80% threshold on certain disease states. 

Mike Koelzer, Host: Oh, that's interesting because the doctors get brownie points.

If they know that the patient got their medicine filled. 

Kunal Vyas: Well, how it works is right is there's certain disease states, which are triple weighted as part D quality measures, cholesterol, uh, blood pressures, statin drugs. The patient who's under a Medicare advantage plan, full risk. They require a 80% threshold as far as fill rate.

Okay. So I'm [00:40:25] gonna give you an example. You got a patient who receives a 90 day fill for their statin drug. With three refills. Doctor sends it to the pharmacy. They fill 90 days, boom, refill another 90 days. And then the third one. Now they've got 270 pills, nine divided by 1270 8%. Now they basically that pharmacy contacts the patient saying, Hey, we're gonna send you out or you need to come pick up your next, you know, uh, the doctor sends a refill for another 90 days.

Patient says I don't need it. I've got more than enough at that point, a CVS or Walgreens employee. Okay. No problem. Thank you. Bye. 78%. Which is lower than 80%. That patient just failed a quality measure. Now, if it was an independent pharmacy, they'll say, you know what, Joe, how about I send you at least a 30 day supply?

You may change your insurance. Come January. At least you have it in case you need it in stock. Patients say, all right, no problem. Now they've sent it. Now they've got 10 out of 12, which is 82%. They've reached the threshold. You know, there's, there's other factors in regards to, you know, free Metformin from, from certain places, paying cash pricing on medications that have a $0 copay.

Anyway, but now the insurance doesn't know that the patient even got the med because the patient was marketed by, um, by, uh, let's say, uh, mark Cuban's pharmacy that, Hey, this is dollar 99, right? Like when he marks it, he marks it as a cash paying pharmacy that does not accept insurance. It shouldn't be marketed to 65 or older geriatric population that have a Medicare advantage plan because they're already got a $0 copay on most of their generic drugs anyways.

So all you've done here is, you know, diverted them to use something where they're paying for it when they weren't probably gonna pay for it. But at the same token, now they're paying $8, $5 shipping fee, $3 dispensing. Uh, for a drug that has a $0 copay. How does that make sense? 

Mike Koelzer, Host: I probably should know more about this, but the doctor, I know there's pharmacy star ratings and stuff, but the doctor then actually benefits too from having 80% fill, right?

Yes. 

Kunal Vyas: So to give you an example, when I own my pharmacy, I took a case study, uh, of, of, of 1000 diabetic patients, which were using, uh, CVS Walgreens and the pharmacy, which my uncle owned, um, made sure that they were all, you know, put the same Mr. Risk score. So therefore it was the same. It wasn't like an outer layer.

Somebody who was a poly farm and based on that, they were saving a hundred dollars per member per. That's huge when you're talking about 30,000 members. So, you know, in reality, these doctors, when they send a script out to CVS, Walgreens or supermarket, it becomes a black hole. They don't know whether it gets picked up.

They don't know whether the patient had an issue with transportation to go pick it up, whether the patient couldn't afford the copay and didn't go get it. Or just whether the patient just neglected to go get it. Like people say 50% of prescribed prescription drugs are never filled. You know, I asked my friend that, all that stuff, that's sitting in the back at Walgreens and CVS.

When you walk in, you see all these scripts sitting in the back, what percentage of those have a $0 copay, like 70, 80% of them? Well, if, if they don't come pick that up, you gotta reverse, avoid the claim, tell your tech to go deliver it. Everybody lives two miles away. 

Mike Koelzer, Host: If the doctor were to find out somehow let's just say in a, in some world that they find out.

About the status of this, would they do anything or I understand their rates go down. They might say, oh, we're gonna lose money on that patient, but what can they do? Are you just saying that there's a comfort in them knowing that certain pharmacies try harder for them? 

Kunal Vyas: A hundred percent, a hundred percent.

There's comfort. And, and, and that's why a lot of these MSOs, which are managed service organizations, have their own pharmacy and they do their own. You, you heard of ACOs, right? The whole purpose of an ACO accountable care organization was to kind of create some sort of a monopoly. And everybody stays within the same network, right?

You go to this specialist, you go to this place to do your blood. You go to this pharmacy to get your meds, and you go to this primary care doctor. The reason they do that is they want to control the cost, control 

Mike Koelzer, Host: the cost and maybe force percentage. 

Kunal Vyas: Yeah. Control the cost force percentage, have more of a bargaining ship when they're speaking to their insurance companies that they negotiate with every year.

Um, you know, there's so many different factors that on a pharmacy end, we don't even realize that is being dealt with on the [00:45:25] HMO and the MSO end. Um, and you know, I always say, what is the doctor's crutch? It's his prescription pad in modern day. It's his EMR. When you go and see a doctor, it is probably a 95% chance that you're getting a prescription written.

Right now, what's the purpose of you going to see a doctor? He evaluates, you write a script and send it to a black hole. And then after that forgets about it, and we don't know what happens, right? So that's the broken part of the whole circle, right? The doctor should know that Sean DOE did receive this medication.

Mike Koelzer, Host: Let's take finances out of it. Let's just talk about medical purposes. I mean, they can maybe tell because they didn't get as many refill requests as they thought they would get through the year. But if I go to my doctor a year later and they don't know what my compliance was, and I'm probably not gonna be honest, I'd be honest.

But the average person is probably not gonna be honest, then they don't know. They don't know how it's working and so on and what adjustments to make. 

Kunal Vyas: Yeah. And it ultimately creates admissions and readmissions. And that's the burn 10,000 minimum pop. Every time a patient goes to the hospital, that's it.

Right. Um, when, when a patient leaves the hospital, there needs to be a med wreck. You need somebody that can make sure that they're taking the appropriate medications and, you know, they're, uh, you know, especially the people using mail order, their pharmacy inside their cabinet at their home. People are removing all the stuff that they're not gonna be taking now because they just had to hold medications, re reconciliation after leaving the hospital, you know, there's, there's so many different components to it, but it all boils down to keeping the patient out of the hospital, keeping the patient adherent to their medication regimen.

And that's where independent pharmacies have always won. That's where independent pharmacies have always been ranked one out of any other pharmacy right today. Right now the independent pharmacy market essentially has an Uber. Delivery model of prescription delivery. Like if you got these independent pharmacies right now are utilizing either, you know, the outsource, but the majority utilize their own drivers, right?

The value of these tens of thousands of drivers, maybe hundreds of thousands for these tens of thousands of independent pharmacies delivering to these hundred thousands of homes every day. Why would Mark Huan use a true pill? He'd rather drive all that business to the independent pharmacy market, because they're gonna be delivering it for free the same day.

At the end of the day, you can't fix something, which is great. Like Amazon prime today. It's pretty hard to replace that because it's already reached the pinnacle. You're getting your delivery the next day, or you're getting it the same day. You can't make it any better, but you sure as hell can make it better when you're dealing with a mail order pharmacy.

And you know, today, right now he's partnering with true pill, which is a mail order pharmacy because they have scaled. They can go nationwide, you know, but the ultimate goal would be that the patient needs it delivered the same day. Well, who can do that unless you're gonna go and buy 10,000 bricks and mortar, the independent pharmacy market can do that.

I 

Mike Koelzer, Host: Think what the problem with pharmacy though, is that every pharmacy, especially independent, independent's a good word for 'em because you got a lot of owners who got some good ideas, but some wacky ideas. And I think it would be hard to send this information out and trust. Independent pharmacies are going to do something similar enough to make it look like one company.

Kunal Vyas: I agree, but the point is that they're already doing it right. They're already doing it. They're doing it in a silo. Right. They're doing it as individuals, as, as, as a silo today. There's no value in, in the 20 or 30 clients or that I may have under RX mile that are in silo doing their own deliveries, 10,000 of them.

Right. But things can change. Right? Um, you, once you've grown that network, once you show that you have that network, now you have a value and that value could come back to the independent Pharmacy. Some of the 

Mike Koelzer, Host: PBMs, they'll say like you can't mail such and such. Can they do the same for delivery? Could they say you're, you're not able to deliver.

You can only deliver a certain percent of your medicine. Yeah. 

Kunal Vyas: Some contracts have that. You can only deliver a certain percent. Um, which is when they say that they mean you can only outsource a certain percent. Oh, 

Mike Koelzer, Host: they won't put a clamp on your own. 

Kunal Vyas: They can't put a clamp on you. Like if today, right now, uh, I'm a pharmacy owner and I'm a hundred percent delivery model and I have my own staff going out there and delivering in the neighborhoods.

That's completely fine. They can't do anything about that. Um, there's a, there's a 50 mile radius clause sometimes that they [00:50:25] have in some PBM contracts. But what if you have an LLC , that's a different company? Well, the thing is that most of these independent pharmacies are pretty much. Utilizing their own drivers.

Yeah. Now as their LLC is still under the same entity, right? So it's not considered a third party. Right. A third party is somebody who does something for not just you, but they do it for Tom, Bob and Joe. This person is strictly working for you. They're doing it for you and not for everybody. Right. That's the differentiator.

Uh, with the third party, 

Mike Koelzer, Host: I try to tell this to people. Let's say you're gonna open up a shoe store, you know, or a pizza store or something like that. It's like, okay. But. Those people are already buying shoes and they're already eating pizza. They might not be terribly happy with it, but they have shoes on their feet and they're eating pizza.

In other words, it'd be different if you moved into a new area outside of Vegas where there's like a thousand new homes. Now those people need it, but you have to be a lot better or something to go into a market where everybody's relatively satisfied. And I think you get that in the pharmacy right now.

You know, the average little old lady is relatively, at least happy with what they're getting from their local pharmacy. And it's hard for people to come in and disrupt that. I think I 

Kunal Vyas: agree. Um, you know, in regards to Mark Cuban, um, Bringing costs down for people who don't have insurance. That's amazing.

That's great. You know, I think that that's a great cause, right? Because there are a lot of uninsured Americans, um, and uh, some of these prices are ridiculous when you're paying. Um, and he's making sure that he can be cheaper. I don't think he's in it for the profitability plus say, I think this is more of a passion project frame.

So, you know, I think that he's going the right path. I agree, but he's got a monster to deal with, um, when he decides to accept insurance or when he decides to get into the manufacturing side or the whole selling side, it's a monster it's a monster to deal with. And, you know, you know, like, like you said, there's so many different types of independent pharmacy owners.

One that kind of is with it. One that might be this way. Right. But, you know, we just gotta support the cause because he's finding the same monster that we're finding 

Mike Koelzer, Host: and your company, if money was unlimited, What would you do with your company that would just be far out of money or ability? What would you do that was really far out, but you just can't 

Kunal Vyas: do it.

Now. My uncle is my angel investor and I told him what I'm about to tell you. And he told me to get the hell out of his room. I said, I want to give this software free to everybody. I want them to see the value and utilize this software. If I can figure out what the hosting cost would cost me per client.

And for me to get this into 10,000 independent pharmacies in this country, and let's say, it's gonna cost me $20 million to host that, to make sure that everything is running and operating. I want to, I'll burn 20 million to do that. And the, and the reason I feel confident about that is because is an easier, um, is an easier way for me to enter in number one, uh, obviously, um, I have enough faith in my product that once somebody utilizes it, they'll see the value to it and the value that they can get from it, with the bells.

And, you know, we got attrition reports to minimize attrition rates, retention reports, med med, the delivery, synchronization, different things. But, you know, at that point you've built a network. You know, you're looking at a map with 10,000 pins and maybe 50,000 pins of drivers and maybe a hundred thousand pins of homes that are all being done in one day.

At that point, you could technically make mail order pharmacy obsolete. because why would somebody expect that when they can get it? Same day delivery free, right? Why wait three to five days, 

Mike Koelzer, Host: I've got a couple software companies that come to mind that I use. One is monday.com. One is one, I work.com and both of those are set up, like you're saying somewhat, or maybe you're alluding to if they both have free.

Entry programs. And then, you know, once you go over certain this or that, or have more than 10 employees, you know, this or that kicks in, is that something that you have then considered where RX mile is free to everybody for 50 deliveries a week is free or something like that, you know, 10 a day. So you get it in the hands of everybody, but anybody who's got a more serious delivery is paying for it, but everybody can [00:55:25] touch it.

Got it. 

Kunal Vyas: So, uh, we are right now, depending on the pharmacy and the conversation that I'm pretty much having and making that decision instantly on impulse, providing 30 to 90 days, maybe even six months free trial, somebody who's doing 500 packages a day, 40 billion ARR dealing with maintenance, medications, delivering, you know, got 20 drivers.

You know, you use it for six months, see how it's gonna work. And by that time, they understand the value. You know, we integrate with their software. It's almost like we become a part of the network effect of their workflow. So at that point, their patients are happy. Cuz they're tracking packages live.

Their doctors are happy with the marketing promotional pieces. The pharmacy is saying, look at the transparency we can provide you and your patient. The drivers are happy cuz they got a stupid proof. To tell them exactly what to do it lets them know they're at the wrong home. It tells them exactly what they need to do for each individual delivery.

Um, and then of course the pharmacy staff, right? They become used to it, right? People always ask me, what do you think your lifetime value is gonna be with RX miles? I'd say 10 years, plus I say 10 years plus, and, and the reason I confidently feel that way is I always make a joke. It's not like the Chinese restaurant anymore.

Right? The son decided he doesn't wanna run the Chinese. He doesn't want to own a Chinese restaurant. He wants to move on. You don't see as many. Now you see a lot of thigh restaurants now though, but so in pharmacy that's not changed. It's still being passed on. The son is still being passed onto the daughter or, or a family member.

You know, I, you know, I don't. The independent pharmacy going anywhere, but staying intact and maybe even growing, I believe with this FTC probe and different things that are going on, that people might actually come out of pharmacy school and wanna own a pharmacy. Again, that's crazy for me to say that, but yeah, I believe that we're not too far away from that 

Mike Koelzer, Host: Once, you know, 5,000 pharmacies have RX miles, something like that.

Let's just say a ton of pharmacies have it. Mm-hmm is there a way to connect all those 5,000 somehow? Is there a, a value in connecting them 

Kunal Vyas: somehow the value is gonna be in the data and this data is not data to make me. Uh, make, make me more successful, make these independent pharmacies more successful, right?

When you have these data points of hundreds, of, of millions of patients that you can go back to the insurance companies and, and say, how are these patients performing on a quality perspective versus patients that are using your mail order or versus patients that are using whoever the hell they decide to send it to CVS, Walgreens, Publix, Kroger, whatever that data is gonna be, what brings that value component?

I see maybe one day that there'll be a per member per month reimbursement towards pharmacies who are managing your life for an insurance company, uh, for that patient. Right. Um, and in that it covers your cost of your reimbursement. It covers your cost of your delivery. Um, the other component is when you've got, let's say 5,000 independent pharmacies nationwide, Which are doing this.

You, you, you have this free same day delivery solution that nobody else has because now you're you, you're talking to these 5,000 pharmacy owners and saying, can I present us to somebody like a Mark Cuban or to somebody like, uh, uh, a Amazon pharmacy? Because remember they're mail orders, mail order can never compete with the same day.

Delivery is impossible. Um, mail order will never compete with the convenience of having access directly to a pharmacist directly. You can literally walk in there. You can call and say, Hey, I'm feeling this way. You're asking for the name of the pharmacist. There's so much value there, man. If you're lucky, a doctor will see you four times a year, every 90 days, you see a pharmacist much more.

Right. And especially if you're delivering to that patient, a member of your staff is going to their home knocking on their door, maybe 12 to 15, 20, 30, 40 times a year. Right? So out of those four times, they see the doctor, the pharmacy gets some, the rest 95% of the time, your patient will see the same driver.

And, and that really creates a continuity. It, it creates the, um, longevity of the patient working with that 

Mike Koelzer, Host: pharmacy. We've got customers that come in, you know, after five years and they're like, oh, you're Mike, you know? And then they say, I wish I wouldn't have seen you. they just want a certain image in their head canal, RX [01:00:25] mile.com.

Yeah. I think there's enough pain points in this delivery setup where you're gonna have a lot of people. Coming on at least to take a look from your 

Kunal Vyas: mouth to God's ears boss. 

Mike Koelzer, Host: All right. Cornell. Oh, by the way. Cool logo. You got, you got the map thing. Like you are here into your capsule. That's 

Kunal Vyas: great. I was trying to figure out the name for the company.

Right? Um, I, I, I was looking up on GoDaddy package, pulse, uh, whatever. They were like four or five different things and everything was $5,000, $10,000, 15,000, right. Two words. And then, uh, one morning I woke up finally and I'm like, you know what? I'm just gonna have to bite the bullet. Um, I'm like, you know what, let me, let me just, lemme try this real quick.

I typed in the RX mile, it was available. Somebody messed up. I paid 90. Who made your logo? There's a company called 99 designs. 

Mike Koelzer, Host: I've heard of them. And then they give you a few options and you can buy different packages and things like 

Kunal Vyas: that. They actually give you like 99 options. Um, and there was a person I can't remember his name, but he was based out of somewhere in Western Europe who made the best, uh, logo, 

Mike Koelzer, Host: canal.

Keep up the good work and thanks for all you're doing to help out the profession. 

Kunal Vyas: Appreciate that. Yes, Mike, and you keep up all the good work. You're doing an amazing job. Um, I love your podcast. I appreciate the opportunity for you giving me some 

Mike Koelzer, Host: time best wishes and we'll talk to you soon. Thank you.