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Cardinal Health, one of the biggest healthcare services companies in the world, has brought together several existing and recently acquired businesses as the Specialty Solutions Group, within its Pharmaceutical Segment. Meghan Fitzgerald joined the company in late 2010 to lead this group, coming from an SVP position at Medco Health Solutions, and before that, stints at Pfizer, Merck and Sanofi-Synthelabo.
Initially, Specialty Solutions comprises Specialty Pharmaceutical Distribution, Specialty Pharma Services, P4 Healthcare/P4 Pathways (a 2010 acquisition by way of Healthcare Solutions Holding), VitalSource, a specialty pharmaceutical GPO, and OncoSource, a specialty pharmacy, and Beckloff Associates, a pharma consultancy.
Let’s start with a rundown of Specialty Solutions, which has only recently come together as a business entity with Cardinal Health. What is the scope of its activities?
We sit at the intersection of healthcare. We are a customer-focused business, serving three segments: healthcare professionals, payors and pharmaceutical and biotech companies. The goal is to know our customers intimately, their needs and what they value, so we can establish longterm partnerships. We have services that are cradle to grave for our pharmaceutical & biotech customers—from scientific and regulatory consulting to product launch programs.
For healthcare professionals, we provide everything from the distribution of specialty pharmaceuticals to value-added services though our GPO, VitalSource, to practice management technology tools. We partner with payors and healthcare professionals to help them develop evidence-based clinical pathways to improve patient care. And through our specialty pharmacy and reimbursement services we offer investigation-benefit and prior-authorization solutions. The ultimate goal of all of these services is to ensure high-quality patient care.
Is Cardinal Health done with adding business acquisitions to Specialty Solutions? Are there parts of it that are going to develop organically?
We are not done adding but the strategy is a mix of organic growth and growth by acquisition. We are opportunistic about partnerships, alliances and acquisitions. While we are always looking for opportunities to accelerate our growth, we have high expectations for organic growth.
It makes sense for Cardinal Health to develop a business unit devoted to specialty pharmaceuticals, since that’s what the biopharma industry itself is doing. As you visualize it, what is the ideal form of collaboration or interaction with specialty pharmaceutical & biotech companies?
Having spent over a decade in the specialty pharma industry, I can tell you the ideal form of interaction is one around trust, partnership and relentless pursuit toward patient care. Our best relationships have aligned around bringing innovation to patients and healthcare professionals while ensuring dialogue with payors. We see a lot of opportunity to establish common ground among different industry players—and use that common ground to build collaboration.
Our clinical pathways are a great example of that. We work with payors to develop clinical pathways program, but our model is built with a clear mandate that in-network physicians are completely in charge of the pathways they’re expected to follow. They use clinical data to develop the pathways. And we work with payors to appropriately incent physicians to participate. For example, we encourage payors to allow physicians to share in cost savings generated by pathways programs. We also help payors develop programs that go beyond reimbursement for medication administration to develop new ways to reimburse physicians for providing quality care to patients.
Through innovative collaborations like these—by helping industry players collaborate and find common ground—we’re able to support the strength of community oncology, help payors contain costs and most importantly, drive consistency and quality in patient care.
We’re also continuing to build strong relationships with community practices and physicians at top treatment facilities around the country, while further strengthening our relationships with leading pharmaceutical and biotech companies. We’re all focused on ultimately bringing first-in-class and best-in-class medicine to patients. And our targeted communication and data solutions help us play an important role in helping to facilitate healthy relationships between each of these industry players.
One of the parts of Specialty Solutions is VitalSource, a specialty GPO. Doesn’t this put you in competition with GPOs that are customers of Cardinal Health, or between VitalSource and other parts of Cardinal Health that look to maximize revenue for pharmaceutical & biotech companies? Also, looking at the clinics and physicians that would be customers of VitalSource, where do you see the “buy and bill” model common in specialty pharma going?
VitalSource is a GPO focused on the community-physician office practice. The GPOs that are customers of Cardinal Health typically focus on the acute care setting, so we are not in competition with those partners. VitalSource works with pharmaceutical and biotech companies to pull through competitive contracts offered to community physician office practices, and to provide services to its physician practice members. This is a separate and distinct activity from the other businesses within Cardinal Health that are working with pharmaceutical and biotech companies on specific promotional programs and market research activities that are for a much wider audience.
There is no doubt that the buy-and-bill model is being challenged by continuing changes in the marketplace. The pressure on this model is resulting in new and creative ways to continue to deliver oncology care in the physician office. If we are doing the right thing by our customers then we will be prepared to continue to offer value to them in any model, whether that’s buy-and-bill or the next generation of operating models.
Does Specialty Solutions interact with other parts of Cardinal Health? If so, how does that happen in a way that is beneficial to Cardinal Health, and to Specialty Group’s customers?
Our business reports into Cardinal Health’s Pharmaceutical Segment, so we are in a great position to bring the best of the entire company to specialty. We see a lot of opportunity for Cardinal Health Specialty Solutions to align with other Cardinal Health businesses, and are still exploring the opportunities that are most beneficial for our customers.
For example, our Nuclear Pharmacy Services business is in many ways similarly aligned to our specialty business. They also serve pharmaceutical and biotech companies, and with innovations like the new Center for the Advancement of Molecular Imaging (Pharmaceutical Commerce, July/Aug, p. 10), they too are constantly finding new ways to help those upstream customers speed new products to market and get them in the hands of health care professionals once they’re commercialized. Similarly, our Nuclear Pharmacy Services business is also focused on helping health care professionals improve the quality and costs of care. They may tackle that problem in a different way than we do, by helping physicians detect diseases sooner and determine the efficacy of treatments. But we’re both focused on the same goal: improving the quality and reducing the costs of patient care. As we grow our specialty business, I’m excited about the opportunity to leverage Cardinal Health’s broader portfolio of services to find innovative ways to serve our customers.
Your professional background includes a stint at manufacturers, a PBM (Medco) and now a wholesaler/distributor. What’s your perspective on the relationships among these types of healthcare businesses, and where do you see those relationships going in the future?
I have been really lucky to have worked at world-class healthcare organizations and to have worked with dozens of really brilliant peers. Maintaining those relationships is very important to me. Today, I think these organizations are more interconnected than ever before. We’re all trying to solve for access, cost and quality, during one of the most disruptive macro environments in history. With healthcare at more than 16% of GDP, medicine becoming more personalized, a booming population that is chronologically advantaged and an unending need for cost maximization, the healthcare service sector and specialty pharma/biotech companies are in for a long, exciting haul. Since healthcare is so dynamic and the problems are more complex, teams will be more open to partnering. I think the healthcare service sector will have a more homogeneous look when it comes to product and service mix, with Cardinal Health out in front.
Your bio also says that you’re a doctoral candidate for at New York Medical College. How do you fit doctoral research into the schedule of a business leader getting a new business unit up and running?
I thrive on information and have been in school non-stop since kindergarten. With two masters and now obtaining a doctorate, I will soon definitely take a break from the classroom. Serendipitously, flying gives me much free, quiet time to catch up on research for work and school. My husband is an economist and on the weekends we banter about politics, which usually means we’re talking about healthcare and the economy.
My doctorate is in health policy which in many ways ties in with my work in the health field. As part of my coursework, I was required to read the entire Affordable Care Act, which was a challenge. I now have a greater appreciation than ever for the professors and academics who work to change policy and develop future thinkers.
ON THE ROAD IN TANZANIA
Has going from mostly East Coast employers to the Cardinal’s Midwest location been a challenging transition for you personally? How are you finding life in Ohio?
I’m a true road warrior so traveling suits me well. I just returned from a family vacation to Tanzania, which was life changing. In my previous position at Medco I was in Europe almost every other week. I ran out of pages in my passport and am now flying through my second one. As Cardinal Health Specialty Solutions is a new business within Cardinal Health, I travel around the country three days a week building new relationships. My primary residence, roots and weekends are in Norwalk, Connecticut where my husband and two Weimeramers live, but in Columbus I have a nice flat nearby Cardinal Health. My colleagues at Cardinal Health are my weekday family. Living in Ohio is easy because Midwesterners are all about hard work, their sports teams and helping you whenever they can. Cardinal Health has been the easiest transition in my entire career. PC