Retail and Compounding Pharmacy OK667

The current owner of this compounding and retail pharmacy has been well respected in the regional pharmacy world for over 50 years and at this location for the last decade. The pharmacy at this location has only changed hands three times and continues to provide unmatched personal care to its clients who have in turn provided loyalty to this local business. The owner is seeking a new owner to continue the legacy of the only independent pharmacy in town by an outright sale or owner-assisted transition. The practice is classified as an S-Corp and operates 6 days a week on the main street in the town it is located. In addition to the owner team which consists of the pharmacist in charge and book-keeper, they also employ 11 F/T employees including; 2 pharmacists, 6 technicians, and 3 clerks. As well as 9 P/T employees including; 4 delivery drivers, 4 clerks, and 1 billing clerk. Excluding the current owners the friendly and knowledgeable staff is expected to remain on after the sale.

The pharmacy specializes in prescription refills, compounding, vaccinations and immunizations, the sale of durable medical equipment, and free delivery for the convenience of their loyal customers. They also manage the prescription needs of local assisted living facilities in the area, and provide patient resources to their clients in person and via their website. The pharmacy also offer many over the counter products including: pain medication, cold & allergy meds, vitamins, oral health products, hygiene, hair care, shower & bath items and personal gift items. Through these operations and services, they have solidified themselves as a staple in the community consistently filling and processing more than 86,000 prescriptions annually. As a participant in the Thrifty White Affiliate Program, the 5th largest buying group in the country, this independent pharmacy leverages the support and resources of a much larger pharmacy network. The practice is also a proud member of the National Community Pharmacists Association, and has access to the PCCA program for compounding support. These extensive and combined operations and services have allowed this independently owned pharmacy to compete with competitors of any size and the 3 chains in town. Further, there may be opportunities for growth by increasing the pharmacy’s partnerships in the area including LTC / nursing homes, increasing their compounding services, and expanded services including medication therapy management.

The current 7,000 square feet facility used to be two neighboring parcels and includes; an expansive front retail area, state-of-the-art sterile compounding room, prescription processing area, Rx / drug storage area, and guest area. The real estate and facilities are owned by the owner via a separate legal entity and leased back to the pharmacy. The real estate additionally includes the 3,500 square feet space above the building, and preferably both would transfer with the business through a purchase, lease or lease-to-purchase agreement. Offering an innovative practice, the owner recently upgraded all software/hardware and the practice utilizes a fully integrated RX30 management system that is linked with their ScriptPro Pharmacy Automation System which holds up to 180 medications. A sale would also include two delivery vehicles (2005 and 2009 Hyundai Accents), an auto sealer, Advanced Detection security system, integrated telephone system, and an updated point of sale system. All other assets, equipment, supplies, and a well-established client list are also included in a sale.

Historically sales have consistently been around or above the $5 million mark ($5.2 million in 2016) and the business has maintained a stable gross margin even while the rest of the industry has seen an increase in generics, lengthening of prescriptions (i.e. 90 day supply v. 30 day supply), and the rise in Medicare Part D. Historically the practice has seen net profit exceeding $200K, or 4%-8% of annual sales (in-line with industry averages). Annual discretionary cash flow earnings to the new owner, i.e. adjusted EBITDA, are estimated to be more than 7% of sales ($400K+), sufficient cash flows for a new owner to service any debt financing, grow and invest in the business and still receive a sizable remuneration package. The estimated value range of this practice from operations is between $980K and $1.3M - excluding cash, receivables, inventory, liabilities and facilities. For illustration purposes, based on weighted averages of our analysis, the estimated value of the operational aspect of the Company as of December 31, 2016 is around $1.12M.