Spokane Journal of Business

Medication Review hits stride in hospital telepharmacy

Spokane concern offers remote service, oversight for small, rural facilities

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Medication Review hits stride in hospital telepharmacy
-—Staff photo by Mike McLean
K. Douglas Crafton, president and CEO of Medication Review Inc., says the seven-year-old company has clients in multiple facilities in 10 Western states.

Medication Review Inc., a Spokane-based provider of pharmacy services and oversight to rural community hospitals, has expanded its foothold throughout the West, and K. Douglas Crafton, the company's president and CEO, says he expects growth to continue at a rapid pace, especially in its telepharmacy niche.

Just three years ago, Medication Review provided services for four rural hospitals in Eastern Washington. Today, its clients include multiple facilities in each of 10 Western states, although Crafton, citing competitive reasons, declines to identify specific hospitals the company serves.

Crafton founded Medication Review in 2005, then as a consulting service to help rural hospitals comply with state and federal pharmacy regulations to ensure patient safety.

"Initially, I funded the company myself," he says.

In 2009, the Washington state Board of Pharmacy approved Medication Review to provide telepharmacy services, which includes automated dispensing of medications and offsite supervision of hospital pharmacies.

Then, the Spokane Angel Alliance provided a cash infusion to help Medication Review expand.

Medication Review emerged into profitability about a year ago, Crafton says.

"We've been cash-flow positive since then, and I'm not losing any sleep over making payroll," he says, adding, "We're at a point where we're expanding, and revenue continues to grow."

Medication Review occupies a total of 2,200 square feet of space, with its administrative and order-processing divisions separated in two buildings at the Tapio Center, at 104 S. Freya. The company also has an ordering office in Nevada, currently staffed by one clinical pharmacist.

In all, it has 18 pharmacists and two administrators on staff.

As the company grows, it creates high-income jobs, as pharmacists earn in excess of $100,000 a year, he says.

Crafton says Medication Review has a low turnover rate.

"We've only lost three pharmacists since we started," he says.

All of the pharmacists have hospital experience and have multiple licenses, Crafton says.

"Pharmacists need to be licensed in every state they serve," he says.

Medication Review primarily serves hospitals that have limited pharmacy capabilities by providing them with 24-hour access to full pharmacy services, often at less than the cost of one full-time clinical pharmacist.

Medication Review's target market is rural facilities identified as critical-access hospitals. The federally recognized critical-access designation was created in 1997 to assure Medicare beneficiaries in rural areas have access to health care services.

The company's role is unique to each facility, and it doesn't aim to take over hospital pharmacies.

"Hospital pharmacies are quite autonomous," Crafton says. "Our job is to help them do their best with what they have."

Crafton says Medication Review helps hospitals achieve compliance with patient-safety protocols.

"Medications in hospitals can be more potent than you can ever get at a retail pharmacy," he says.

Washington state requires that before a drug can be administered to a hospital patient, the medication order must be reviewed by a pharmacist to check for allergies, correct dosage, possible interactions with other drugs, and appropriateness for the course of treatment.

"They do need pharmacy oversight," Crafton says. "The state Board of Pharmacy doesn't want nurses just running into the pharmacy for medications."

Under a telepharmacy system, a physician writes a medication order for a hospital patient, then the hospital sends the order via a secure private electronic network to Medication Review, where a pharmacist reviews the order and enters it into the hospital's electronic medical records, Crafton says. At the hospital, a nurse reviews the medical records, obtains the ordered medications from an automated drug-dispensing machine, and delivers them to the patient, he says.

A growing number of rural hospitals have automated drug-dispensing machines, which are at the heart of decentralized medication distribution systems. The computerized machines, which control access to medications, are custom programmed for each facility and can assist with billing and inventory control.

Crafton says a number of other companies make the machines, although Medication Review can help hospitals implement and manage such systems.

Here, Providence Sacred Heart Medical Center & Children's Hospital was a pioneer in telepharmacy, but retreated from that market in 2009, leaving an opening for Medication Review to expand its services, Crafton says.

"We enhanced it when we took it over," he says. "Our company was primarily pharmacy management services. It was a good fit for us to add on a telepharmacy department."

Medication Review's embrace of technology, which includes proprietary image-scanning software and secure connections with the hospitals it serves, has helped the company grow in a competitive market, Crafton says.

"We've been able to displace a couple of competitors," Crafton says. "They're watching us. We run into them in hospital settings."

San Francisco-based Pipeline Healthcare, and Envision Telepharmacy, of Alpine, Texas, are Medication Review's main competitors in the West.

Crafton is a pharmacist as well as an entrepreneur.

"This company is run by pharmacists," he says. "I've worked in rural places, so I get it. I have true understanding of what hospitals are trying to do, and I think that makes a difference."

Spokane has been an ideal base for targeting community hospitals because of its perception as a small city close to rural surroundings, Crafton asserts.

"If our office was in the Transamerica building in San Francisco, I don't think rural hospitals would relate to us," he says.

As the company continues to grow, it doesn't plan to open offices in larger cities.

"We chose our office in Nevada because it's right in the heart of rural medicine," he says. "It sends a message from our company that we are willing to work in your space."

Crafton says Medication Review stands to benefit from the planned move of the Washington State University College of Pharmacy to the university's Biomedical and Health Sciences Building now under construction here.

Crafton is an adjunct professor at the college, and Medication Review employs three of his former students, he says.

"Students see this as another method of practicing their profession," Crafton says.

Having the College of Pharmacy nearby will help Medication Review stay on the cutting edge of new pharmaceutical developments, he says, adding, "That's where research and new technology comes from."

Medication Review's next big growth push will be in the Midwest, he says.

"For now, our goal is to go out and help as many hospitals as we can and grow like any other business would," Crafton says.

Mike McLean
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Reporter Mike McLean covers real estate and construction at the Journal of Business. A multipurpose fisherman and vintage record album aficionado, Mike has worked for the Journal since 2006.

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