Bootstrapping Using Services from North Carolina: Ateb CEO Frank Sheppard (Part 4)

Sramana Mitra: How fast were you able to course correct on that? I imagine that when you saw that things were not working out, you fired the CEO. When did that happen?

Frank Sheppard: Late 2003, I believe. We were probably short of bankruptcy, but like all good entrepreneurs, we were too stupid to do that. It took us probably 18 months to get fully back. By 2005, we were back to a very healthy and well-run company.

Sramana Mitra: The business went back to your original pharmacy solution?

Frank Sheppard: Yes.

Sramana Mitra: What was the revenue level in 2005?

Frank Sheppard: We actually had a spike here. That was because we had neglected opportunities so much that we were able to recoup that quickly. The real sustained level is probably in the $11 million to $13 million range.

Sramana Mitra: So what happens in the late 2000s, between 2005 and 2010?

Frank Sheppard: Just improving the efficiency of how prescriptions were filled and how you operate your pharmacy wasn’t enough to help pharmacies grow and thrive. We started looking at trying to determine how we can help pharmacies compete and stay viable in the future. From late 2000 through 2010, we started the notion of where we are today, which is look at different ways to help pharmacies to be more effective in how they work with their patients and capitalize on the opportunities.

Pharmacy is a unique challenge in that most patients are non-adherent with their medications. The biggest area of growth for pharmacies is to look at different ways to make patients become more adherent in their medications. It’s a little bit oversimplified, but 50% of the prescription that the pharmacy receives to fill are nowhere close to being filled as per what the doctor originally intended. If you were going in to get a prescription that you’re supposed to take every month for the next 12 months, the average patient would be off of that therapy within six months.

The goal is to get patients to come close to taking all of their medications correctly and timely. These are solutions like refill reminders, pick-up reminders, and outbound calls to the patient to remind them that their requested prescription is still in the pharmacy and needs to be picked up. It’s a recorded voice calling. We’ve moved into some more aggressive adherence tactics like identifying specific medications that were important for the patients to take and give them reminder calls as those prescriptions were coming due. The good news about those tactics is that they were very effective. They are effective because we still do them today.

What they do not do is they don’t know a lot to actually change the patient’s behavior. If you stop placing pick-up or reminder calls, the patient reverts right back to what it was before you started reminding them. We proved in the data what the programs did. They weren’t really helping educate the patients to create a fundamental change. For the last three to four years, our focus has been to equip pharmacies to better engage patients to drive healthier outcomes.