The Business of Pharmacy Podcast™
Jan. 30, 2023

The Dual Pharmacy Model | Nate Hux, Pharmacist, Freedom Pharmacy and Pikerington Pharmacy

The Dual Pharmacy Model | Nate Hux, Pharmacist, Freedom Pharmacy and Pikerington Pharmacy

Nate Hux, R.Ph. is a pharmacist who runs a dual pharmacy system, where one pharmacy is inside the traditional healthcare system and the other is outside of it, He believes that this system allows for greater transparency for customers and helps them understand the costs of their medication.

Nate Hux, R.Ph. is a pharmacist who runs a dual pharmacy system, where one pharmacy is inside the traditional healthcare system and the other is outside of it, He believes that this system allows for greater transparency for customers and helps them understand the costs of their medication.

  • Nate Hux, R.Ph. is the owner of two pharmacies in Pickerington, Ohio: a traditional pharmacy called Pickerington Pharmacy and a direct-to-consumer pharmacy called Freedom Pharmacy.
  • Hux became frustrated with the corporate chain pharmacy system and decided to open his own pharmacies to offer more transparency and lower prices for customers.
  • Freedom Pharmacy is especially beneficial for those with high deductible plans or Medicare Part D, as the copays for generic medications can be much lower and it also helps them avoid hitting their donut hole as quickly.
  • The speakers discuss the challenges of running a pharmacy and how the pricing of drugs affects their business. They mention that by separating their businesses, they can make different rules and standards at each pharmacy.
  • The host, Mike Koelzer, brings up the topic of no-compete clauses and how large pharmacy chains often require them. Nate Hux, R.Ph. notes that he would not be able to sell his pharmacy if he were to sign such a clause, and that he would likely just close Pickerington Pharmacy and transition all those customers to Freedom Pharmacy if it were to fail.
  • Nate Hux, R.Ph. wants to continue working in the pharmacy and helping customers, but also wants to spend more time traveling with his wife and spreading the gospel of how community pharmacists can make a positive impact on people's lives. He also mentions that he hopes to be less involved in the day-to-day operations of the pharmacy in the future, and potentially out of the insurance headache altogether.

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(Speech to Text)

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

Nate Hux, R.Ph.: My name's Nate Hucks. I own two pharmacies in central Ohio in a town called Pickerington. Was part of two corporate chain pharmacies for over 20 years. And then finally I became fed up with the world inside the chain pharmacies and decided that I was going to buy my own pharmacy.

So in 2016, I bought Pickerington Pharmacy, which is a more traditional pharmacy. We take all insurances, we do immunizations, MTMs, all those normal things. And then two years ago, I decided to open a second pharmacy right next to Pickerington Pharmacy called Freedom Pharmacy. And Freedom Pharmacy accepts no third party payments from anyone.

So we do business directly with the consumer. 

Mike Koelzer, Host: Now Nate, there's a lot of things I'm gonna compliment you on today, but one place I think you got it wrong is having your place right next door because we just have one pharmacy. But if I had another pharmacy, I would always put it somewhere else where I could hide between the two of them, So it's like, where's Mike?

Well, he must be on the road, or something like that, And it would take me like four hours to drive two miles between the stores. You've got a pharmacy right next door. Why do we have a pharmacy right next door to your other pharmacy?

Nate Hux, R.Ph.: Well, for some consumers, for some pharmacy consumers, it may be beneficial to use an insurance card, but for many, it's actually detrimental. It actually increases their costs. So, . The reason I put the two pharmacies side by side was because now we can conserve 

whichever consumer comes to the door.

So if I have a pharmacy consumer that comes in with a super high deductible plan, let's say it's a $10,000 deductible, I process that prescription through for, let's say Lipitor, 10 milligrams, and it comes back $45 copay. Well, I know I can take that consumer to Freedom Pharmacy and fill the same prescription for $15 and the consumer wins, and I don't have to pay any fees for processing that prescription.

I don't have to have the headache of billing anyone, and we can educate the consumer then about. Maybe living outside this insurance world will be beneficial for you, and we can have a conversation about that. So the reason the two pharmacies are side by side is because they're different business models.

And for some consumers it may make sense if they have, say, federal employee insurance, which is typically pretty beneficial to the consumer versus, another pharmacy consumer that maybe works for a small business and they have a $10,000 deductible and they're never gonna meet that deductible anyway.

 The other thing too is, Medicare Part D

 Over half of the customers we have at Freedom Pharmacy are actually Medicare Part D customers. 

Medicare Part D is interesting. the copays many times for inexpensive, generic medications go through for relatively high copays. For instance, you may have a prescription for, sertraline 50 milligram, and you process a 90 day supply through the Medicare D plan, and it comes back at a $30 copay.

Nate Hux, R.Ph.: That's pretty typical, for a d plan. Now, in that prescription, I'm going to get a d I R fee of perhaps $25 . 

So, I end up netting out $5  and

Nate Hux, R.Ph.: the consumer's paying me $30. So why are we doing that? Like, if it benefits the consumer and it benefits me to not process a claim through the insurance, why not do that?

Now, the other benefit of not processing prescriptions through the Medicare D plan and especially those low cost generics, is they're gonna not hit their donut hole near as fast if we can keep those out of there. That's a common scenario that happens between the two pharmacies.

But for the most part, we like to keep them in one pharmacy or the other if it's possible.

Mike Koelzer, Host: How long was it that you were in the first store before you went into the two stores?

Nate Hux, R.Ph.: so we opened [00:05:00] Freedom Pharmacy December of 2020, so it was almost exactly five years

Mike Koelzer, Host: Five years. Okay. So now bring us back to that aha moment. Was it a feeling? Elation that you had this idea. Was it a feeling of disgust that you said, what am I gonna do? Was it worse than discussed?

What got that ball rolling into two pharmacies?

Nate Hux, R.Ph.: Well, all of the above that you just said, right? There was frustration watching the fees going up and doing business with third parties, the credentialing, getting more expensive, getting harder to get credentialed through those third parties all the time. there's billing claims all day long.

just just the inefficiency of that, right? chasing claims, making sure you're getting paid what you're supposed to get paid and, working with PSAO and all that stuff, you know that, that's the disgusting part. We were working on a campaign here in Ohio with our legislators to try to show some of the problems with Ohio Medicaid.

And I had the schematic that I had drawn up and arrows pointing all, all over the place, and I was super proud of it. I took it into one of my lawmakers and I was trying to explain the convoluted system, and at five minutes in, he wasn't listening 

anymore, and he just grabbed my paper and took a sharpie and started xing things out that were on my, he said, why do you do business with these guys? So if you want an aha moment, that was the aha moment, right? 

It's like, why are we doing this? Why are we doing this? Why are we putting ourselves through this 85% of what we dispense? We can probably sell it for around $15 for a 90 day supply. What are we doing? Fooling around with insurance with this.

Mike Koelzer, Host: Here's the problem though, Nate. When I think about what you did, I'm not even sure if I ever had that creative thought, but let's say that I did. The first thing that would come to me would be the PBMs probably have something in their contract that does not allow, two buildings with a bearing wall to do th You know, I mean, they've got something in their contract for everything.

And then I'm thinking if the PBMs wouldn't allow it, there's gotta be something in the state that's not gonna allow this. And the first thing that comes to my mind is duplicating everything. I mean, there's some things that you can not duplicate, maybe the heat can go through the doors and, you can have one guy you're paying for shoveling out front or something like that.

But it seems like a lot of the stuff you have to have double of, like double pharmacists and double licensing and all the stuff that you don't want to think about has to be double. Those are the things that come to my mind that would say, ah, that would never work. Seeing you do it was remarkable to me.

Cuz it's like, oh geez, someone is doing it. 

Nate Hux, R.Ph.: Well, first of all, as far as duplicating things, it's really not that difficult to 

Mike Koelzer, Host: a new pharmacy license, a new NCPDP number, a new NPI number. Those things are all pretty easy. getting a, uh, a second DBA for my parent company, hucks Enterprises llc. Not difficult. getting a starting inventory of around $6,200 for generics, not difficult. Is that a shared inventory or are there laws that say they have to be separate?

Nate Hux, R.Ph.: separate. So they're separate inventory. One of the things I did before, I tried to open Freedom Pharmacy as I contacted the State Board of Pharmacy and I told 'em what I wanted to do. I said, look, this is what I want to do. I think we can help people save money and I think we can put the control back in the pharmacist's hands instead of third party payers that are telling us what to do.

And I think it would be beneficial for all parties here, if you let me open this. And they were totally on board. They were excited that somebody was trying a free market solution instead of complaining constantly about it. D i r fees and this, that, and the other. 

So, as far as the duplication, that wasn't a problem as far as the state board was concerned, that wasn't a problem.

And as far as the third parties are concerned, freedom Pharmacy doesn't exist.

It's more dangerous to change your usual and customary pricing inside your PBM controlled pharmacy, than it is to open a second pharmacy.

Mike Koelzer, Host: It's not like you're saying, all right, here's the two of us. Now you're basically saying there's the one still.

Nate Hux, R.Ph.: Yeah, I don't have to credential with anyone for Freedom Pharmacy. it's totally off the grid. It's really only between the consumer, the doctor, and me. That's it.

Mike Koelzer, Host: Here's another one, [00:10:00] Nate. Here's the biggest one that comes to my mind probably is, the laws of the pharmacy has to have a pharmacist there. you always have to have a pharmacist and the pharmacy. Do you have to straddle the doors, all day long that's a big one in my mind, I'm thinking

Nate Hux, R.Ph.: Yeah, that is a good point. And I did ask the Board of Pharmacy that question before we, we proceeded with 

 I said, look, we're essentially gonna be in the same space. Can one pharmacist do exactly what you said, straddle the two sides? Right. and they were okay with it as long as we were physically present and as long as we signed off that we were the pharmacist, on duty that day.

I mean the two pharmacies combined are smaller than. Most corporate pharmacies, right? if you're talking about the physical space that the pharmacist occupies. Now we do have a staff pharmacist on duty specifically for Freedom Pharmacy every Monday, Tuesday, and Friday. 

Mike Koelzer, Host: Oh, that's interesting. 

Nate Hux, R.Ph.: So the only time we straddle is Wednesday, which I'm there in, in my office on Wednesdays.And then Thursday, we  straddle for a half a day. So honestly we have a pharmacist, dedicated to Freedom Pharmacy 80% of the time that we're open and the other 20% were straddling like you had.

Mike Koelzer, Host: And the days you're straddling you, probably share a wall. And I don't mean to get too physical, but you know how these state boards and the things are, they actually say so many square feet and so on, but you're probably sharing a wall. the door might be open, it might be questionable, even if there was one non-owned building between you, that might not even fly.

But I imagine being with the shared everything makes it so.

Nate Hux, R.Ph.: Correct.

Mike Koelzer, Host: And you don't think you'd be able to do it even if you were, even if there was a Hallmark card shop between you or something. The big part of it is actually being next to each other physically.

Nate Hux, R.Ph.: correct.I think that was key. Suite B and Sweet C Connect connected by a door between the two.

Mike Koelzer, Host: Yeah,

So we're physically straddling the door. at times, it, like I say, it doesn't happen a ton, 

Nate Hux, R.Ph.: but especially when we were first starting out, we got to the point where we were really able to support a second pharmacist, youwe were doing a lot more straddling.


Mike Koelzer, Host: Somebody comes to you, Nate, and they say, is this the answer for every pharmacy in the us? What is your answer?

Nate Hux, R.Ph.: I don't know. We'll find out. 

 um, I'm the only one that I know of that's trying to do dual pharmacy, one that lives inside the system and one that lives outside the system. 

Nate Hux, R.Ph.: There are others that are popping up that are fully outside the system. . 

So, but I do know that there is benefit for some consumers to use their pharmacy insurance.

Um, so I want to be able to take care of those people too. Plus, P Pickerington pharmacy's been around for 32 

years.I don't want to kick those people or, make them live in my new world if it's beneficial for them to live in the world that they've known for 32 years 

at Pickerington Pharmacy.So I don't think it's for everybody. I don't know that it's something that the corporate chains would ever try to do. I, I'm surprised at some point that somebody wouldn't try to do something like this because it just makes a lot. 

of sense. To avoid all the PBM fees that are 

Mike Koelzer, Host: You mentioned that it kind of makes it clear to customers. I like that because sometimes we make the mistake of thinking that customers know what the hell you're talking about. for them, If you mentioned insurance or provider, or pbm, whatever.

I mean, for a lot of those people, there's me, there's the doctor, and then there's everything else Is this conflated blob, they don't know when they come into your pharmacy, and not that we do, but you start spouting off about, this price and that price and the provider and the, the payer and this, and they don't know what the hell's going on. So it'd be quite a visual to actually have two separate buildings to get the point across.

Nate Hux, R.Ph.: Absolutely. and every day it's education. I mean, it's constant education. When we process a claim through insurance and, let's say it's, I'm trying to think of a good example here where, let's, okay, here's one. We just had the other day. Uh, VE Care, generic Soin went through [00:15:00] for a $285 copay at Pickerington Pharmacy.

said,I can do better follow me. And I walked them over to Freedom. I asked my pharmacist, Jim, I said, Jim, can you do a price quote here of Suison five milligram number 90, and it's $20 and 80 cents . So, 

So, that sort of transparency with the customer, right? is, and, what's the alternative that you could do at Pickerington Pharmacy?

Run it through GoodRx 

and pay whatever their administration fee is. GoodRx is not the answer. 

Nate Hux, R.Ph.: It's an excuse to keep usual and customary prices

high. So, here's what I will tell you. Try to educate the consumers about the usual and customary price inside the system. and there's a usual and customary price outside the system.

If we work outside the system, you are taking an incredible burden off of my plate, and I want you to benefit from that. I want you to know that, hey, the cost of this drug is $8. I mark it up 10% plus a pharmacy services fee, $12, and your final price is $20 and 80 cents. We can shake hands and that's where the financial transaction ends.

But if you make me process this through your insurance, I'm going to have to pay transaction fees. I'm going to have to pay network performance fees. I'm going to have to pay d i r fees. I'm going to have to chase the claim down. I'm gonna have to make sure we get paid for it. If you can keep me from having to do all that.and we can just do business together. Why not? Let's do it

Mike Koelzer, Host: Yeah.

Nate Hux, R.Ph.: So,

Mike Koelzer, Host: Those optics are perfect of having the person, walk over there with you, because I'm not saying you can do the same thing with one store, but there are ways to say, all right, we're not gonna use, this quantity of difference, so we're not gonna use your insurance this time.

And you kind of talk to, like I was talking about, they have no idea what's going on. You talk to 'em and pretty soon you're like $200 apart in your own pharmacy. And it's like, it doesn't take long before they start thinking you're a used car salesman, without that divide.

Nate Hux, R.Ph.: Well, that's exactly right. and I really feel like transparency, and that's one of our core words, quality, personalization, and transparency. Those are our core words at Hucks Enterprises. Transparency is so lacking in our business. 

It is, it is. tired of trying to make a living, buying low and selling high.

I don't want to do that. I wanna make a living being a good pharmacist. And if I do, you get good at what you get paid to do. 

you get, paid to, to, buy things as cheap as possible and then try to get the system to pay you as much money as possible, that's what you become good at. 

if you get paid for your services, like we do at Freedom Pharmacy, you become good at services. you can hold your head high and say, look, this is what we're worth. and I hope you feel satisfied. I hope you feel the same, that you know our service

Nate Hux, R.Ph.: is worth $12.and at the end of the day, most of them just care. Well, is it less expensive in this world or that world? 

But you get to have that conversation with people and they learn a lot and they get excited and they feel like they become part of a movement too. It's like there's been, here's the other thing about Freedom Pharmacy is, we, being the first of the year, we're starting to get a little more picky about what insurance contracts we take at Pickerington.

So, we had about 50 people, maybe a little between 50 and a hundred that we stopped taking their insurance. 


We were able to move some of those people to, to freedom. We were also, if they wanted to stay inside the system, also help them to, to, and these, these are part D people.

And they're, they're on an advantageous plan. So they have until March 31st to change. So a lot of 'em are changing. Now. We might have lost about 20% of those prescriptions, but Freedom gave us another solution, another option for them to continue our relationship. And in many cases, it was about the same amount of money.

It might be a little more, it may be a little less at freedom, 

but the most important thing to that consumer was continuing the relationship. [00:20:00] And that's the most important thing for us, right? 

Like that's our goal, is to make 

that relationship 

the focal point of what we do.

Mike Koelzer, Host: That's a drag where. I mean, if I own a restaurant and I up my prices 10% over a similar restaurant, you might have some relationships that gradually go, or people stay, they kinda have that decision. But in pharmacy you'll get people switching a whole relationship for like 50 cents.

And here's why People don't mind spending a little bit more on a good steak or something like that because of the atmosphere and the service and all that. But people hate spending money on medical stuff. And so for 50 cents, a lot of times they'll leave a pharmacy because they'll be damned if they're gonna give somebody 50 more cents.

It's like those relationships can end quickly, over 50 cents.

Nate Hux, R.Ph.: So a wise man once told me at a ce, pharmacists spend a whole bunch of time chasing people that don't want to pay them for what they do. We gotta, we gotta stop doing

Mike Koelzer, Host: That's true, isn't it?

Nate Hux, R.Ph.: if they're gonna leave over 50 cents. You didn't have a good relationship anyway. 

Mike Koelzer, Host: That's true.

Nate Hux, R.Ph.: You let those people go

Mike Koelzer, Host: Yeah, that's true.

Nate Hux, R.Ph.: and they can go have fun at their corporate chain pharmacy.

that doesn't have their stuff in stock and doesn't have it ready and never finds any solutions for any of their problems. And maybe they'll want to spend that extra 50 cents next time. But, I've come to decide that I'm not gonna chase down people that don't want to, to, compensate us for the services that we provide.

It's okay to let them go.

Um, so yeah, I agree with you. There's a lot of consumers that are like that, and they're just perfect for the corporate chain pharmacies.

Mike Koelzer, Host: One thing we did about two years ago now, two and a half years ago, is, we stopped carrying all brand names at our pharmacy.

Nate Hux, R.Ph.: I know,I knew that about you and, I think that's just fabulous that you guys did that. 

 You can't make any money carrying brand name products.

Mike Koelzer, Host: no. for our listeners, the cool thing, Nate, did the pharmacists know this, but any non-pharmaceutical, the cool thing Nate did is he separated his businesses and because of that, he can make a difference. Rules and different standards at each pharmacy. If you've got one pharmacy, you can't really decide to say, I'm gonna sell this to you, Sally, cuz you've got good insurance.

But Bob, your insurance has been nasty to us, so we're not gonna sell this. You're not allowed to do that unless you do something across the board. And so we did that across the board. We got rid of all brand names. And I'll tell you what, Nate, subconsciously, as you were saying earlier, subconsciously w I started giving crappier service to lovely Mrs.

Smith, who was 80 years old because I knew I was gonna lose on that medicine and I just couldn't, I couldn't override that feeling of disgust. I was looking at her as a sweet old lady, but I was feeling disgusted because I was losing money on that. And so, I had to, besides probably going on a business trip if I didn't make this move, but I had to clear that from my system because I started just getting this nasty taste in my mouth whenever I would serve somebody and not get what I thought I was worth.

It's terrible, it's a terrible feeling.

Nate Hux, R.Ph.: That's right. I know exactly what you're talking about. And that's, that was, another piece of why we open freedom, right? We're somewhat agnostic to the price of drugs. What, what Freedom Pharmacy does is it resets the accountability on all levels on the manufacturer level, on the, on the,wholesaler level, on the pharmacy level, and on the consumer So the accountability, listen. . Yeah. I get calls all the time. What can you do for me for Ozempic? What can you do for me, for Jardiance? and I just give them the price quote. ozempic, $1,100 

 What? I get it for 300 through my insurance. Well, congratulations. I mean, I mean, until we start holding the manufacturers accountable for 

Nate Hux, R.Ph.: some of these prices, somebody somewhere has to pay for this

stuff. And hopefully what'll happen eventually is the manufacturers will wake up too and say, we need to like start doing business outside this system too, because we could half our price if we would stop you knowing half the cost of the drugs, Uh, to, to the insurance company, , 

But they haven't made that [00:25:00] decision. yet.

And I tell every drug rep that comes in to talk to me, I tell 'em that, no, not too many of them come in anymore because they're always like, it's above my pay grade. And I said, well, call your CEO and have 'em call me. I want to talk to these guys and say, Hey, if you could revolutionize healthcare, if you would live outside the system,  People would still pay money for your stuff, But we gotta stop coming out with a thousand dollars medicines, we gotta stop doing 

Nate Hux, R.Ph.: that 

Mike Koelzer, Host: Michigan came up with a new law in 2024, you know? D i r law and all that stuff that one of my staff asked me, they said, is this gonna change everything? It's like, no, it's gonna suck still, probably, but at least you know what sucks better. And you can go to the political breakfast and say, Congressman so and so, look, here's what's happening.

and you mentioned it earlier, Nate, I don't think you were maybe getting to this point, but, look, Congressman, here's what's happening. Do you follow this? Now? Be careful. It's three or four steps, so let me explain what's happening. But now, without these laws, it's like 12 steps for them to follow what's happening.

Mike Koelzer, Host: And they zone out after one or two of 'em.

Nate Hux, R.Ph.: The right. 

Mike Koelzer, Host: Nate, what happens when, sometimes there's customer's words, Kind of good for insurance, but then there's a few out there it's like, boy, I wish I could do something different and different.

In your case, it would be Freedom Pharmacy. Do you get people that you split or you're tempted to split, or is it better to keep them all at one?

 Each individual case is a little bit different. There are some people that it makes a ton of sense to split, but then I try to educate them too, to say, look, you're three brand name medicines. I'm losing money on those. So if I cherry pick your six generics and fill those at Freedom, the terms for those are very favorable through your insurance.

Nate Hux, R.Ph.: So they're, essentially subsidizing 

 on the brand name products with very reasonable reimbursement on the generics. And you know what most customers will say, I get it. Okay, that's 

Nate Hux, R.Ph.: let's do it. , 

Mike Koelzer, Host: it'd be best in these cases not to split it. Maybe somebody's paying more out there. You might be paying about the same, but it's helping us to have these together, and they're agreeing to 

Nate Hux, R.Ph.: I'll tell you what happens most times in those cases is they end up sourcing their brand name somewhere else and then they fill all their generics at Freedom. So, and I'm fine with that. because it improves my cash flow at Pickerington. Um, I don't have to deal with billing anybody for know, I can go to CVS or Walgreens who obviously get a better price on their brand name medicines than I can. 

Nate Hux, R.Ph.: because they're still in business somehow and they're able to take this reimbursement, or who knows what the reimbursement terms are for those guys. Maybe it's even better than ours.

Who knows? But I know this, I can only tell you what I can do, right? can't, like, I can't say, look, I can't fill your brand names here. but I just give people options and put the ball back in their court, right? if you want to use freedom, that's fine, but I'm not gonna be able to fill your brands at Pickerington.and if, if that works out for you, if you want to do it all at Pickerington, I can do that and we'll be equal to just about anybody else out 

Nate Hux, R.Ph.: there. So a lot of times they end up filling their brand name medicines at Walgreens. I mean, we have seven. corporate pharmacies within two miles of our store,

So,there's plenty of choices if they want to use a corporate pharmacy or even if they want to use mail order for those brand name products. I don't care. Whatever they want to do.

Mike Koelzer, Host: I don't know my status as a pharmacist like me in town, but , we're not the most welcome guests at a party when anything we send away from us, our brand names that most people are losing on. We have a friendly competitor, a bit away, but sometimes we'll even call them and say, Hey, we got this brand name we're gonna send your way because we did the looking on it and it looks to be decent for you.

Do you want this prescription and solution? But most of 'em, it's like, these people can decide where they want it, but you know, all these brand names are coming from our pharmacy, but that's all right.

Nate Hux, R.Ph.: That's fine,

Mike Koelzer, Host: Yeah, most of 'em are part of the problem anyways. if you look at CVS and things like that.

Nate Hux, R.Ph.: Absolut.

Mike Koelzer, Host: Nate, if someone said to you, Nate, here's 10 million to do something with freedom. outside of the freedom, boundaries outside of the physical boundaries. And you've got 10 million and you can either, you can either market with that. You could buy other pharmacies. You could try to have [00:30:00] someone, franchise this or that.

You could start up a consulting thing or whatever. What's the next step with 10 million that you would take with this idea if you couldn't put it into that property?

Nate Hux, R.Ph.: So I have thought about this a lot. and what I would do is, make a consulting company that could teach people how to do this. And,I think the concept needs to, and you're sort of doing it already without brand names in your pharmacy. So, the concept needs to be magnified.

Nate Hux, R.Ph.: the headache of owning a bunch of pharmacies, and I don't want the problems that go along with 

you put your name on something and then somebody does something bad and, and,it gets wrecked. 

Nate Hux, R.Ph.: Um, so I would like to start some sort of consulting company that would teach other independent pharmacists that are interested in making this transition, how to do it.

step by step. What were the things that we did, what lessons learned, how much staffing do you need? all those nuts and bolts type of things. And just want other independent pharmacists to do this, whether it be what I'm doing with the dual pharmacy thing or just starting a pharmacy outside the system,

October: Going completely generic

Mike Koelzer, Host: It was a gamble cause we didn't know who we'd keep. it happened to work out because, and I've been around a long time, and things have been going downhill, but right when things started getting really nasty the last few years with way below cost, and that's all relative, but way below cost, and just getting screwed right when this happened at the same time that we decided to go with just generics, it's so happened that, and God bless 'em.

I love my brothers and sisters at chain pharmacies. Everybody's trying to do a good job. It's corporate, pushing down with the metrics and so on. So I never blamed the pharmacies, but right when it got really tough for us, it also got really sucky tough for a lot of the chain stores in town.

And so 

I have never heard more complaints about some of these big chain pharmacies that I have in the last year than I've heard in the 20 or 30 years before that. So it seemed to all be in sync where customers were willing to split their pharmacy up, come to us for generics because they're getting worse service at the chains.

It dropped off a cliff. And I think all that's kind of related with all the people pulling from the market without adding any benefit.

Nate Hux, R.Ph.: Yeah, I, I completely agree with you. and that's another reason why Freedom Pharmacy's been popular and why it's growing because, is pretty low right now.

Mike Koelzer, Host: Lower than ever.

yeah. so, I always, and we have a niche at Freedom, we do non-sterile compounding. , 

Nate Hux, R.Ph.: That's our most profitable part of our we're averaging about four compounds, five compounds a day now. and we're filling about 25, commercial prescriptions, which every month's a new 

Nate Hux, R.Ph.: record. So that's growing right 

now,so, even without that niche, I think we would be fine at freedom.

and that was a significant investment, putting all the, the labs in and all the equipment and 

Nate Hux, R.Ph.: negative, youtube, negative pressure that you have to create. I mean, that's a significant investment. I, I do think as any independent pharmacist, you do have to have a niche of some kind, that was what I decided to do at Freedom.But honestly, these days. It's a niche just being good


know, because, because, and like you said, our brothers and sisters that are sweating it out still at the corporate pharmacies, I know that they're good people they want to do well, but the fact of the matter is we got business people in charge of our profession.We don't have pharmacists in charge of the profession. 

So Freedom Pharmacy really at its core is about putting pharmacists back in charge of pharmacy instead of large corporations that dictate to us what we're supposed to be doing. We know better 

than somebody that's never set foot in a pharmacy what we need to do to take care of our patients.

Right. , but at the corporate pharmacies, that all doesn't matter. It's they're businesses that happen to do pharmacies. They're 

not pharmacies that are in business.

Mike Koelzer, Host: I think that a pharmacist who's a business person is a really strong combination. Because [00:35:00] back when I wasn't at the pharmacy much from 2015 to 2020, I was kind of done with the whole thing. We were losing money and I had a bunch of staff. Probably should have unloaded, but I was hoping things would turn around and stuff.

And one of the pharmacists there became my picks, one of my pharmacists in charge because I wasn't around enough. And boy, that was a struggle because this pharmacist, I don't blame her, but , it's like every controlled drug took like 45 minutes for them to triple check their work.

And, patients were waiting and they had all these log books and all this stuff, and it's like they didn't have the connection to efficiency. I don't blame her. If someone is putting me in charge of the DEAD stuff and they say you're in charge of that, it's like, I'm gonna do the same thing unless I've got the monkey on my back of having to, support the store and do all that kind of stuff.

So that's just a small example of how powerful. The pharmacist business owner slash a huge stake in the business is important because you really have to see both sides, because if you're pure cash, that can get away from you in a hurry. Same with pure medical, though, that can get away from you in a hurry.

So you have to have that nice mix, I think.

Nate Hux, R.Ph.: Oh yeah, for sure. And that's, balancing on a knife's edge sometimes. I mean, you know that as a pharmacy business owner, I mean, it is. It is not easy, but I would not change it for anything. I would never, I would never leave the profession if I had to go back into a corporately controlled pharmacy.

I couldn't do it. I would literally do something else to support my family. I just could, couldn't do it.

Mike Koelzer, Host: Does it really suck? Nate?

Yeah. it really does. Does it suck Because you are the person in your blood, you were destined to become Nate, the double pharmacy owner. Does it suck because that was your destiny or did it just suck?

Nate Hux, R.Ph.: it sucks that it, has to be that way 

because it wasn't that way in the mid nineties when I started. 

 we took care of people 

and we made a living doing it. And when I bought this pharmacy in 2016, I asked the owner and I said, listen, I don't need to be a millionaire, but can I make a living doing this? And he said yes. And he wasn't lying at the time 

Nate Hux, R.Ph.: because like you said, it just, I bought the pharmacy at absolutely the wrong time. Right. Like d i r fees

just being talked about. 

Mike Koelzer, Host: Um, they weren't a thing yet. You knew margins might be tight, but you never thought it would be taken out the back door 

Nate Hux, R.Ph.: yeah. You look at a front end, 21% margin and you're like, ah, okay. 

You know, and then you look at a backend 15% margin, you're like, you can't do 

this. Right. And that's what it became with the fees. The fees just are out of control. they've grown exponentially 

And so, the front end margins aren't really any better. but the back end fees have just completely ruined that, that model. 

 So we had to come up with something else. 

Mike Koelzer, Host: You just had to, cuz people will say to me, they're like, all right, Nate, let me, let me say this. Nobody says this to me, but let's just pretend. Some people said, Mike, you're a genius, you know, for getting rid of the brand names. And I practice my speech and I say, well, now I'm not a genius.

If I didn't do it, I would've been out of business. That's my speech Now. No one said that. It reminds me, I was just telling the kids yesterday, you saw the Hamlin guy go down on the bills, 

You so, Remarkably, I, coming up, I was a lifeguard. I took all these boring CPR classes, and first aid classes for being a lifeguard. I actually gave it two times. I gave CPR in my life, which is remarkable cause you never think you're gonna use it. And one of the times, this guy at a business next to us, he basically dropped like Hamlin did. He was standing there and he dropped backwards with this cardiac arrest and this guy across the street ran over and said, who knows cpr. So I ran over there and I gave him C P R till the fire trucks came. And when I'm done, I see this guy's eyes blinking. I know he was still alive. I'm practicing my humility. c p r Hero speech already, this is already in my head. And so there's like four or five people standing around.

So the business owner that had come over, he hops in the, uh, ambulance with [00:40:00] Tom, my friend now, that I've saved his life. No, So Dan hops into the ambulance, Sue his wife drives Tom's car . Somebody else who was there, they go back to work or something. I'm standing there a hero and I had no one to give my speech to.

Everybody took off, So I went in and I called my wife. I'm like, Margaret, you'll never believe what I just did. So anyway,

I've been practicing my brand name.

genius speech, my hero speech. But that wasn't the point. It was just, you don't do whatever you're gonna close, you know, and you can't give a hero speech when you're closed, so you might as well do it.

That lets you keep going. but I imagine it's similar to you, you, you didn't have the option.

Nate Hux, R.Ph.: Well, that's right. I mean, at least I didn't feel I had the option. The crossroads I came to before I opened Freedom. 

It's like, here's what I can do. I can finish out my loan that I took out a 10 year note to buy Pickerington And I could probably get it paid off and then own a business that was completely worthless.

Okay. So I could invest some more money into a new business model. essentially doubles down on what we're's going to be difficult and, but at least I can have something that has value when it's paid off . so, it wasn't about a hero speech and it wasn't, I'm not trying to like, become this icon of any kind.

As a matter of fact, I don't really like the spotlight. I had the Today Show in and we had, we had all kinds of, we've had all kinds of attention. 

I don't, I'm not that type of person. I don't like attention, really. You get used to it after a while, 

Nate Hux, R.Ph.: after,being invited on things like this podcast 

You get used to it. But it has nothing to do with that. It's just that I want to make a living helping people by being a pharmacist.

and it wasn't happening in the insurance world anymore. 

we had to decide, we had to come up with a different strategy to, to put a value on our services, and that is taking care of people, helping them navigate the very complicated, complex and sometimes dangerous world of prescription medicines.

you know,we get no respect or value from any third party payer 

out there at all. 

I mean, I mean, the relationship is worth zero

to them, but to me, and hopefully to the consumers that choose to use our pharmacy, 

That relationship is very important and highly cherished.

Mike Koelzer, Host: What's sad to me about the whole damn thing is. The health of our pharmacy market, let's say people we interact with is really no better off than it was 20 years ago. it's not as if all this money got dumped to the PBMs and got taken from the middle and went to the middle man.

It's not like something became of that, like computers got a lot better, smaller, something, new cars, new electric vehicles, that kind of stuff. It's like it costs more money. The middlemen sucked so much out of it that things got worse and the. That's sad that people are stuck under that dominance, stuck in as much as until somebody breaks free.

Nate Hux, R.Ph.: Well, I think there's a bigger problem than just, I don't think this is unique to healthcare. 

This is like the whole United States. This is, you've got three companies to choose from for your internet service provider. 

Nate Hux, R.Ph.: three companies to choose from for your insurance.

You have three companies to choose from, for,getting your groceries. 

 It is like over consolidation of the market. And it has led to poor service and higher costs. It's become everybody's goal. It seems in the United States and the American greed world we live in to become too big to fail. So if you're too big to fail, it doesn't really matter what you do. And that's how I feel about the PBMs. 

I mean, they're too big to fail. if you become a threat to them, they just buy you.

I mean, that's, and the, and they suck you up into their, World, where then they, it's an oligarchy. It really is.and that's, like I say it, it's very pronounced as healthcare cuz we see that everyday cuz we 

[00:45:00] live in that world. But I think that's a problem throughout the United States and many industries.

we have over consolidated everything and we've, and I don't care what political party you're affiliated with or, all let it happen.

Nate Hux, R.Ph.: Um, and,it's bad for the consumer, it's bad for the average American citizen. you've got the upper echelon growing at a slow rate.You've got the. Growing at a pretty fast rate, and you got the middle class disappearing , and, uh, that's a problem, man. Like that, that's a real problem. and I look at Freedom Pharmacy as being for the middle class person, right? Like, you're willing to, pay something, for your healthcare.

Nate Hux, R.Ph.: You're willing to have skin in the game. 

And, those are our consumers, right? Like,and hopefully that continues to grow over time. Well, it'll be interesting to see five years from now if Pickerington Pharmacy still exists or not. 

Um, or if Freedom Pharmacy still exists. I mean, who knows what could happen.So,it's a diversification of revenue as well, right? Like it's, it's like, Well, I'm not reliant on it, 25% of my profits now come out of Freedom Pharmacy. least 25% aren't reliant upon the system, 

Nate Hux, R.Ph.: and I expect that fully to become 50% within the next three years. I expect freedom to actually be equal with Pickerington as far as the profitability.

And in doing many less scripts,

you know what I mean? Like, it's just we do more profitable stuff, because we're focused on the things that are profitable there 

Mike Koelzer, Host: If someone's got two businesses, and let's say they're one of the businesses goes down, for some reason, I think the other one pops up right away, like 25% more.

you have. More energy now all of a sudden you're Nate, the guy that sold it all, to have Freedom Pharmacy. No longer do you have two pharmacies. You know what I mean? It's like you, everything goes into that. And , I think even more comes. So like once you're at 25%, you're already at 50, sort of if you had to

Nate Hux, R.Ph.: Oh, absolutely. and by the way, neither at this point in time, neither pharmacy is sellable in 

 because I've had some brokers stop in and they're interested to learn about what I'm doing. And I said, well, I can tell you what I'm not gonna do is I'm not gonna sell Freedom Pharmacy.

Nate Hux, R.Ph.: Well, you can't just sell Pickerington because you would still be in business here at Freedom. Right. 

and and like you said, half of those people would probably just make the jump over, so what I've always suspected if we do end up,not, not making it at Pickerington, is that we would just essentially close Pickerington and transfer everything over to Freedom and and then see where we end up,Right.listen, it's a terrible time to sell it's, mostly your book of business worthless. you're gonna get pennies on the dollar for what you paid for it. So, I'm not selling anything from Pickerington. If anything, I just close, close Pickerington and transition all those customers to freedom and then let the cards fall where they may.

Mike Koelzer, Host: That's kind of how I am with my pharmacy right now. I'm sort of, basically buying a job, as you alluded to, basically, having income in a relatively safe spot where I can sit on my ass and kind of do what I want to most of the You know, where , you know, if I'm in a chain or something, like they got someone cracking the whip on me, you know, who the hell am I kidding?

If a chain hired me, they'd say, well, are you here to be the greeter? I'm like, no, I'm a pharmacist. 

Nate Hux, R.Ph.: Oh, shoot.

Mike Koelzer, Host: I've got friends. Mike and Steve. they, about 10 years ago, the owner of the pharmacy that they were employees of, he sold the store and. You and I know from both ends that employees feel a certain way, but sometimes business owners have to do it a certain way and so on.

But anyways, he sold the store. They were a little bit bitter, so they bought a building that was just one drive away. There's just a driveway between them, and they made like five foot profile pictures of each of themselves and put 'em in the window of their new place. And so obviously that was a draw, and they just pulled everybody over.

Nate Hux, R.Ph.: I mean, they would just buy the files and integrate 'em into their corporate chain pharmacy. they wouldn't physically occupy Pickerington. they'd move half a mile down the road to CVS or Walgreens or whatever.

Mike Koelzer, Host: they'd still probably consider you too close.

Nate Hux, R.Ph.: Oh, [00:50:00] absolutely. They'd be like, that's the first thing that those guys do is make you sign a no compete clause within 25 miles.So I'm like, well, then I won't be selling, so don't waste your time coming around here , you know? 

Mike Koelzer, Host: Would you have changed anything in a dreamland?

 I mean, hindsight's 2020. I never really look back. I only look forward to it. I try to learn, I probably didn't know enough to own my own pharmacy when I bought it. 

Nate Hux, R.Ph.: I don't know if anybody does until they are right there in it. Right. I was not a business owner for 21 years of my career prior to becoming a business 

Nate Hux, R.Ph.: So, you know, I mean, I, I, I would say when I bought the Pickerington pharmacy, that would've had to have been. where the road would've forked potentially somewhere else. Um, but I wouldn't change anything, if I could, becauseI think we're maximizing our potential as best we can.

And what more can you ask of yourself? Obviously I've made mistakes along the way and I've learned and tried to get better. I probably hired too much staff when I first opened Freedom, and then we quickly figured out, well, we're not gonna be open very long if we keep this much staff.

So we got it balanced out. and now, now we're making it work. 

 There's tons of things you can do, but honestly, I'm excited about the future. At least I have something I can work with. 

Nate Hux, R.Ph.: and I, and again, that's another reason why I did freedom is because I can make the rules and can decide what's best and nobody's dictating to me what's important and what's, not important, 

which is what you get when you own a pharmacy inside the insurance world, 

Nate Hux, R.Ph.: community pharmacy, there's plenty of blame to go around. As far as finding ourselves in the position that we're in, there's some blame on the corporate chain side. There's some blame on the payer side. with the PBMs, there's some blame on the manufacturer side for the unbelievably high prices that they want to charge 

Nate Hux, R.Ph.: So there's lots of blame to go around.and I used to think that the chains were responsible for the state that we find ourselves in, and community pharmacy, which is. , as we've talked about at length here, not a place that most of us want to be. but honestly,there's lots of factors involved that I was naive to, 

Nate Hux, R.Ph.: to being an owner, So you can only control what you can control as an owner. Freedom Pharmacy, to me, is exactly what the name of the pharmacy says, right? It's freedom. 

Nate Hux, R.Ph.: It's freedom to be who we want to be. It's freedom for our customers to not have to listen to other people telling them which medicines.

 One of the things that drives me insane right now, is the PBMs playing the rebate game with brand names that have generics available. 

It is unbelievable. Like you're forcing people to get brand name Advair and forcing people to get brand name Adderall and forcing people to get all this, name brio, all these things that have generics available.

 Having a pharmacy in that world that wrecks your generic compliance rate and by the way, one of the things that I think is very important is that we don't, with our wholesalers, we don't accept rebates.

So, we want the prices to be what they are. We want our kitchen to be clean. if, if we're going to say the other side has to be transparent, so

Mike Koelzer, Host: don't accept rebates at Freedom,

Nate Hux, R.Ph.: Correct. That's right. We don't, and it's hard to find a wholesaler that'll agree to that,

Mike Koelzer, Host: right?

because that's traditionally, they hide, they want to hide prices too, right?

Nate Hux, R.Ph.: So, they want to pretend like the bottle of Lipitor that you bought is 10 50 instead of two 50. 

So they'll give you a $30,000 rebate next month. We don't play the rebate game. And I think that would go a long way too on the, on the brand name side.

If we would end. on the brand name side, that would help tremendously.

Mike Koelzer, Host: Once we got rid of brand names, all those games kind of cleared up. We maybe do some rebates now if they're actual, quantity discounts, based on the purchases of the generics themselves. But all those games of,by this many brands. And, uh, we don't have to do that [00:55:00] anymore.

 I used to complain to my, my, Wholesalers, they'd come in and I'd plop down a bottle of something, 800 Motrin or something. I'd say, how much am I buying that for? And they'd give you all the bologna, about the whole rebates and all that stuff. And I said, that's sickening.

 I brought up a used car salesman earlier. It's worse than being a used car salesman, but it's like, I'm buying X million dollars from you guys and I gotta play this rebate game. And then they blame it on somebody else and all the blame goes around and stuff.

 That's cool that you're not doing that at Freedom.

Nate Hux, R.Ph.: Well, resetting accountability. 

You know what I mean? you need to hold them accountable. Everybody needs to hold each other accountable and everybody needs to eat. So,what we have is a situation where PBMs have really ruined the ecosystem and you know they're gonna be their own demise because There's not gonna be any more fuel for them to fuel their fire.Right. And then people are gonna start doing, it's just inevitable that people will stop doing business with them at some point and start doing. freedom, right? 

Freedom Pharmacy. I mean, it just makes too much sense.

Mike Koelzer, Host: Do you ever think about,when you're on the big news and things like that? And by the way, that's a great segment there on the Today Show, and you had Antonio, Chacha and things like that with you guys. Do you ever think about what you say about PBMs?

I'm sure you don't narrow them down. I don't really name them directly here, but I think if I'm a pbm I probably. I might go after a lot of people, I might put podcasters and social people a little bit further down the list because they might be able to lash out a little bit more, and in theory, make an impact on things.

But do you ever think about that now that you're, more of a target,

Nate Hux, R.Ph.: Yeah. People have asked me that question and I can tell you this. I've noticed absolutely no change in my relationship with the PBMs whatsoever. So I don't feel like I'm a target. I think that they're just in ignore mode.

I don't think they know what to do with it. What are they gonna do?

Make another news story? Are they gonna like, get the Today Show back out there because they booted me out of their network because I own a pharmacy that's helping people. Are they really going to do that? 

I mean, if you really think about it, it's not in their best interest to even acknowledge that this is happening, because it just blows the roof off of, all the secrecy and the, the back door deals 

Mike Koelzer, Host: So Nate, how young are you now?

Nate Hux, R.Ph.: I'm 

Mike Koelzer, Host: 49. You're 49. Giving your, druthers, what would you be doing, 60 10 years from now? What would your day look like? Would you be in these couple pharmacies? Would you be traveling the United States as a spokesperson? What are you gonna be doing 10 years from now, if anything?

Nate Hux, R.Ph.: Well, I would say for sure I'll be less involved in the  day-to-day operations than I am now. I mean, I work as a pharmacist at least 34 hours a week. Um, I'm behind the bench in the workflow. Um, I think that will be significantly less. Um, I want to travel. My wife loves to travel. She's a government employee, so she has tons of vacation and I never get to really do that with her and she deserves it.

So I want to do that for her, but I also want to be spreading the gospel of, you know, we don't have to live in that world. 

And pharmacists are a valuable part of the healthcare system. Community pharmacists can make a huge impact on people's lives. and we should be proud of that. And we should be saying, this is what we do.

and we should not be afraid to be compensated for doing that. and Freedom Pharmacy. allows us to sort of quantify the pharmacist relationship, in terms of dollars and cents. it allows us to say, look, this guy thinks he's worth 12 bucks 

Nate Hux, R.Ph.: per prescription per 90 days.Is he really worth that much? 

I hope so. I hope you think so. How many times have you called me seeking advice? 

Uh, how many interactions have I caught? How many therapies have we converted to save you money? . 

You know what I mean? Like I'm worth every penny.

Mike Koelzer, Host: That's exactly right. 

Nate Hux, R.Ph.: [01:00:00] So hopefully I'll be doing some of that in 10 years, spreading the gospel a little bit. Um, I still want to hang out at the store quite a bit. I mean, I love being there. I love seeing the customers,it's enjoyable for me. Hopefully I'm not dealing with too many insurance headaches in 10 years and that's somebody else's responsibility.

Or maybe we're out of that game altogether. We'll see.

Mike Koelzer, Host: My wife and I talk about traveling, but I haven't really broken to her yet that I'm trying to have her travel with me, you know, instead of on her own somewhere. Even the thought about hanging around the pharmacy, it's pleasurable to hang around the pharmacy when you're needed and you've put dollars to those needs, and sometimes it doesn't matter how much it is, how wealthy you're getting from it, but

just the theory of somebody paying you for something to put somemetrics behind it versus, like you said earlier, the whole game of how low can you buy and how much spread can you have, and so on. Some of those were the reasons why I wasn't at the pharmacy from 2015 to 2020.

Nate Hux, R.Ph.: And now why I don't mind being around so much because the disrespect is not there from the, Payers and stuff as much, absolutely. And,your, your point about Mrs. Smith comes in and you feel bad because you were angry because you wanted to help her, but you knew you were gonna lose 12 bucks on her. I mean, that's natural for a business owner to feel that way. 

 And you know what? Damn the contracts, gonna tell Mrs.

Nate Hux, R.Ph.: Smith, you know what? I can't fill this for you 

because, and that's essentially what you've done with eliminating brand names and saying, , we can't do this cuz we're gonna go out of business. 

Mike Koelzer, Host: Right. 

Nate Hux, R.Ph.: I mean, that was a brilliant move.

Mike Koelzer, Host: keep going Nate. I'm getting ready for my speech now.

Nate Hux, R.Ph.: I mean, I,I applaud you for doing that. And, pointing out and in, in your own way, you're, putting accountability on the players here, the brand name manufacturers and the PBMs and the wholesalers. You're like, we can't do this.we can't survive and do this. 

Nate Hux, R.Ph.: And maybe CVS is getting 30% off. Who knows? I mean, we'll never know.

Mike Koelzer, Host: yep.

Nate Hux, R.Ph.: But you can't stay in business and do brand name medicine.

Mike Koelzer, Host: Sometimes I think that when you get pushed around and you feel disrespected, if you, if you don't make a change, it might not even be a great change. But if you don't make a change, either what you did or what I did, or maybe doing the podcast at least to, you know, Gripe, but get some positive out of the griping, you know, because maybe someone comes along, being on the news, whatever, you're making progress 

Nate Hux, R.Ph.: just, 

Mike Koelzer, Host: can only just sit around and gripe so much without going crazy.

Nate Hux, R.Ph.: yeah. I mean, you're trying to be solutions based, you know, you're not just sitting around complaining to lawmakers or this, that and the other. 

Mike Koelzer, Host: Nate, golly, thanks for being honest. As soon as I saw your report online, I knew I had to talk to you and I think you've given people some great ideas. I think every pharmacist is going to be imagining this scenario.

So, thanks for giving people that little glimmer of hope.

Nate Hux, R.Ph.: Yeah. Hey, it's my pleasure, Mike, and I really appreciate you having me on today. I appreciate you for doing what you do and giving us a platform to talk about these things and share ideas. And now it's a lot of work and I appreciate you doing that.

Mike Koelzer, Host: Well, thanks Nate, and I'm gonna look forward to watching you and, we'll certainly keep in touch and follow you along on this journey, so thank you.

Nate Hux, R.Ph.: Thank you.