Sep 14, 2012
PUTT Board conference call with RxAlly
On Tuesday, 8/28/2012, All 8 members of the PUTT
Board of Directors had a conference call with 4 senior people from
RxA to discuss the new Smart D preferred Part D network. We sent in
a list of 30 questions, with a request to reply in writing and also
a request to see a copy of contract between RxA and the IAGs
(buying groups) that signed on to support RxA.
The call last for over 2 hours, and consisted of Bruce Robert's explanation of his role in CCRX, and also his reasoning of why SmartD was needed (very similar to the written materials previously released).
Because many in the independent pharmacy world still have issues with Bruce Robert’s involvement in CCRX and it’s sale to CVS/Caremark, combined with little public disclosure of how the CCRX mess transpired, we tried to bring some of this into the sunlight.
Bruce responded that “this was all above board” because “the NCPA Board was aware of and approved of my role, and my compensation (stock package).” While I found his explanation to be factually accurate, I think it minimized what was (or should have been) known about venture capital (VC) involvement, VC entry and even more importantly VC EXIT plans, and the effects those plans would have on the future existence of CCRX. Those types of VC terms are spelled out at the time the transaction is originated, so it could not have come as a surprise to any of the principles involved that the VC wanted out when (and because of independent pharmacy) CCRX was successful.
Further, I think that NCPA Board oversight was lacking when it came to CEO oversight during that phase of CCRX being sold off. In short, there were other options besides VC involvement, and the appearance of conflict of interest in those decisions is high.
At the close of the meeting, a few of our written questions were addressed, but many others were not. We asked, and they agreed to provide a written response to those questions (copied below). To date, no further answers, including a copy of the IAG contract have been provided.
Anti-trust laws prevented us from discussing or addressing pharmacy contract offers.
Our goal here was to assess the transparency of the various parts of this multifaceted puzzle, so that pharmacy owners could have ALL the information they need to make an EDUCATED independent decisions about RxAlly, SmartD, and the future impact of various Part D networks beyond what was offered to them or to the PSAOs as a contract.
In summary, I can't say I obtained any new information that had not already been released into the public domain. I will say it appears as though we were expected to just buy into the logic of their business plan and agree to their explanations. I had the feeling they didn’t quite understand that we were not looking to develop a long term relationship, or even a friendship for that matter. I was quite clear we were seeking answers to our questions, and would be sharing those answers, or the lack of answers to our members. If we hear any different or they provide answers/clarification at a later date, we will share that as well.
Dave Marley, PharmD