What Can CBD Do for Your Pharmacy and Patients?

Shannon Battle (00:08):

Hello and welcome everyone. Thank you for joining our short discussion today where we’re here with Farmer and Chemist, and we’re going to talk about how CBD can still be a viable source of revenue for our independent pharmacies. My name is Shannon Battle. I’m the pharmacy services manager here at Independent Pharmacy Cooperative, and I’m here today with Douglas Bergon Farm MD and Co-founder of Farmer and Chemist. You guys are one of our favorite preferred IPC vendors for sure with the Vendor Advantage Network. So please, Doug, tell us a little bit about your background and how you got started in this space.

Doug S. Burgoyne (00:39):

Shannon, thank you. We love IPC and appreciate the opportunity to share a little bit of information with you today. So as Shannon mentioned, I’m a pharmacist. I went to school in Chicago and one of our co-founders, Jeff Dunn, is also a pharmacist. In fact he’s third generation pharmacist. We really got into a CBD business. I mean, I hate to say it like this, but almost by accident, having a long history of just traditional medicine and being firm believers in the standard pharmacy model, we were super skeptical of any cannabis or cannabinoid product. And in fact, in our state, in the state of Utah, when it was coming up for a legislation to be legalized potentially, then we were actually worried as pharmacists that we’d see all of the negative effects of cannabis in our community. And so we were actively working with legislators to try to restrict use of cannabis and the more we got into the science of cannabinoids, not marijuana, but CBD and some of the benefits of it, we realized there was something to it.

(01:49):

So we’ve done a ton of research and gone through the literature, what’s available anyway, talked with people who’ve used it and really started to understand and believe that there are some real benefits to CBD in some very specific areas. It’s not a cure all for everything. So by accident we got into the CBD space and we’re so happy that we did. It’s wonderful when someone walks into our store and they rub some SAV on and then we talk to them for four or five or six minutes and then they say, oh, my shoulder pain is gone. That just makes us smile. That doesn’t happen in the regular pharmacy. When you say, oh, I took my lisinopril, I feel so much better. So it’s a great space to be in. It helps people and we love the immediate effect that folks feel when they use farmer and chemist CBD products.

Shannon Battle (02:45):

Awesome, awesome. It really takes that interest and love for your patient and your product to get that out there and really get people interested and ready for it.

Doug S. Burgoyne (02:55):

Yeah, absolutely. So Farmer and chemist was started as mentioned by pharmacists with the desire to create the highest quality CBD products that are available. So we work with chemists who are also part of our founding membership team who work in CBD specific labs to help us create our products and go through all of the regular good manufacturing processes that one would expect from a quality pharmaceutical product. But we apply those same principles to CBD, and as we mentioned, there are only a handful of uses that are really effective for CBD. There’s a lot of literature and certainly more information will come out over the years as we understand more about cannabinoids, but where we know the science is legitimate today is really in three areas, pain, anxiety, and sleep. And before we get too far into those three indications, maybe let’s talk a little bit about the science of cannabinoids.

(04:08):

If we look at the hemp plant, so just commercial hemp, there are about 120 different cannabinoids that are grown within that hemp plant and it varies. The concentration of each cannabinoid varies based on the genetics of the hemp. Well, with appropriate engineering and genetic engineering, then we can get hemp plants to express more or less of certain cannabinoids. And so working with local farmers and understanding the soil science and the growth, which is tremendously important to creating quality products and farmer and chemist does that, we are growing hemp that expresses high quantities of not just CBD but CBG, which is great for pain. It’s an anti-inflammatory and other hemp plants that express more CBN, which is excellent for sleep and anxiety. Now we mentioned there are about 120 different cannabinoids. THC is one of those, and it’s hemp. If there’s less than 0.3% THC that’s grown in the plant and it becomes marijuana or cannabis, if the THC concentration exceeds 0.3%, so everything that we grow and distribute and sell is commercial hemp with less than 0.3% THC.

(05:43):

So if you’re looking for products that meet state requirements that are grown from hemp, then farmer and chemist is definitely the place to do that. So three indications, chronic pain as well, as well as neuropathic pain, and that could be joint shoulders, back muscles, wherever it is. It’s also good systemically, and we’ve had a lot of folks who are using a combination of oral as well as topical CBD for even migraines, excellent for anxiety and to help people get some sleep. In fact, anecdotally there’s a local football coach who’s undergoing a stressful season right now, and he has used some of our CBN gummies and he reports that he’s gotten the best sleep that he’s had in a long time despite the troubling season. So we know,

Shannon Battle (06:43):

Yeah, I’ve heard similar things from some of our members who have had users that they’ve used it expecting either to feel some kind of way or really for it not to work, and then they realize later, this really does work. I’m getting good sleep, I’m feeling better, and I didn’t think about it at all. It just does what it’s supposed to do.

Doug S. Burgoyne (07:02):

Yeah, it really does. And the nice thing is there are very few side effects so you don’t wake up groggy. It’s not like taking Ambien where you’re going to do things that you don’t remember or be embarrassed about later. Instead, it just kind of mellow. A person out calms their mind and allows them to fall asleep. And then the quality of sleep is significantly better as well. So for folks like myself who wake up in the night and then just want to fall right back to sleep, the CBN gummies and tinctures help with that as well. There are some things that pharmacists should know about CBD and that is there are some important drug interactions that really are unmentioned in the marketplace. The most significant ones are warfarin and clopidogrel because this is metabolized by the CYP two C nine pathway. That is an important drug interaction to remember.

(07:59):

There are some others as well, but they’re minor. Those are the two most important. And interestingly enough, as you can see on the graphic, our bodies actually have specific receptors for CBD. There’s the CB one receptor, which is in the central nervous system and the CB two receptor, which is in the periphery. And so our understanding on the science so far is humans evolved with the hemp plant and we have specific receptors. So it’s unlike many other medications where we share receptors or are blocking receptors. Instead, we have specific receptors for CBD, which means that our bodies know exactly what to do with it.

Shannon Battle (08:45):

That’s amazing. Now, is that both the receptors and talking about the different ways that it metabolizes, is that all part of the training or additional support that you all are giving the stores and what does that entail?

Doug S. Burgoyne (09:00):

Yeah, Shannon, that’s a great question. Yes, we want stores who are carrying farmer and chemist products to be successful and to be able to educate. We think it’s one of the most important things when people come into our CBD store and ask questions about CBD is dispelling myths and rumors that they’ve heard fears that they have about CBD and then understanding the science behind it. So for any pharmacy that is interested in learning more about cannabinoids, then what we would offer is a one-on-one webinar where you’ll meet with us, we’ll teach you about the science, we’ll bring our chemist in, we’ll talk about the hardcore science if you’re interested in that and the way that the products are manufactured and teach your team about it. We’ve had some great success with some lunch and learns or after hours programs where we can have the whole team together and teach the staff as well as the pharmacists so that everybody is more up to date and able to help answer questions from customers.

Shannon Battle (10:05):

That’s amazing, and that’s not something that you’re normally going to get when you’re trying to stock your store with a new product or a new benefit for your patients. You get just basic information. So really great to hear that.

Doug S. Burgoyne (10:17):

Yeah, we would love to do that as we think about CBD in terms of the marketplace, this is really a growing market. So it’s estimated this is going to be just CBD alone is going to be a 13 billion market by 2028. If you think back to far to the February to the December, 2018 farm bill and legalization of CBD nationwide, federally, and then most states followed, that’s really a pretty nice growth from 2019 essentially to 2028 to become a 13 billion industry. So we think the pharmacy should be part of that. There’s no better place for a patient or a customer to learn about CBD than from their pharmacist who should be the expert on all things medicine. And we believe, and the data has shown out by our stores that are carrying pharma and chemists, that there are some real benefits to carrying our products in terms of attracting new customers who are looking for alternative therapies and building loyalty by becoming an expert in more than just prescription medicines. But in over the counter CBD products as well. I think pharmacists have questions about CBD, but the general public has tons of questions. They’re Googling it, they’re asking chat GPT about it, and what they need to do is come into the pharmacy and ask us pharmacists questions about CBD as well.

Shannon Battle (11:47):

Yeah, absolutely. Our pharmacies are facing issues with declining reimbursements and the revenue streams and CBD has been in the spotlight for years, but everyone still has so many questions. So do you feel like it’s really still a viable source of revenue for independent pharmacies specifically, and how can they really step forward into that space?

Doug S. Burgoyne (12:09):

Oh yeah, that’s a really good question. This is absolutely a viable product for independent pharmacies and in fact, this slide shows some of it. So if you look at just average reimbursement, and this is from data published in Journal of the Pharmacy Association, I think 2019. So it’s a little bit dated in terms of reimbursement rates, it’s probably lower now, but generic prescriptions, average pharmacy reimbursement or margin gross margin is a little over four bucks brands or 20 yet with farmer and chemist products like our gummies, there’s a $30 margin on those. Our salve, it’s almost $60 and steady going, which is a tincture is $65. Now, these are IPC specific prices. These are not prices and margins that anybody else can make this as specific in our agreement and deal with IPC. So this is special pricing just for IPC members. But if you think about that and the reimbursement on selling one package of gummies or one SAV from a product that you believe in and have tried and it’s true and tested, then it really does improve store margins.

(13:35):

There are some benefits listed on this slide here, but just a couple of stories about two rural independent pharmacies. One started carrying farmer and chemist products about seven months ago and they’ve increased their store sales almost $11,000. Another one started carrying 15 months ago and in 12 months in just the last 12 months increased store revenue by over $20,000. And they’re not having a lot of patients that are coming in. This is a handful of patients who have become loyal customers who had asked about alternatives or the pharmacist had actually recommended something and they were getting voltar and cream or they were suffering from constant back pain and insomnia and they were feeling a lot of benzodiazepines for sleep. And so the pharmacist recommended CBD, and all of a sudden store revenues increased 20,000 and that’s without doing much. So we know that it works. Then increase gross margin for stores

Shannon Battle (14:47):

Much larger value than your general sleep meds or pain and anxiety meds for sure.

Doug S. Burgoyne (14:54):

Yeah, absolutely. If you’re filling a Xanax for a patient every month so that they can fall asleep, there are safer alternatives than that without the addiction potential, without the significant side effects and with a better margin for you, better outcome for your patient as well. So Shannon, you mentioned the education and that’s exactly how we are designed. So for stores that are interested in carrying our products, as I mentioned, we’ll schedule one-on-one webinars with you so that you can ask any question that you want. We’ll go through all of the science behind it so that you can teach your patients, and then we’ll keep you up to date with information so that you can stay up to date with your patients on the latest science as they get questions. All of our products go through a rigorous three-step testing process. Not every CBD products available in the market does this.

(15:55):

I already mentioned the soil science and how important that is. So we’re very careful about who grows our hemp and where it comes from. And then the pharmaceutical grade manufacturing process that we have. And then our products are tested three times, first by our internal lab and they’re tested for purity as well as potency. Then they go to a third party lab for testing and validation of our own results. And then because the state of Utah is so particular about CBD, which we support, the state then does its own test of our products. So it’s essentially triple tested. Now, the triple testing is potency as well as purity, but it also ensures that our products lack things that could be tremendously harmful, like heavy metals and pesticides, which goes back to the soil science. So if you’re carrying CBD products and are unsure of the background and the heritage of those products, then you should be very skeptical and work with a supplier like Farmer and chemist that goes through these rigorous products. Everything is tested, it’s triple tested, and we meet all of state of Utah’s rigorous compliance requirements around C-B-D-C-B-D, concentrations, THC levels, as well as purity and potency,

Shannon Battle (17:24):

And we’re happy to share all of our stores.

Doug S. Burgoyne (17:26):

Yeah, and we’ll share that with you.

Shannon Battle (17:29):

Awesome. So how do you suggest that our independent pharmacies get started in offering CBD marketing their demographics? What really you do you all suggest to get started and get out there?

Doug S. Burgoyne (17:41):

Yeah, well, the best way is to start asking customers, have you ever heard about CBD? Have you ever tried it? And what happens most frequently is someone will say, yeah, I tried it and it didn’t do anything for me, or No, I haven’t tried it. I’ve been afraid. And so kind of pull your customers a little bit, the folks that have tried it and said it hasn’t worked for them, there are reasons for that. Number one is most CBD that’s sold in gas stations, vape shops, barbershops, you can get it almost anywhere is ultra low potency. And so it doesn’t have enough CB, D to really do anything. Second reason is if they bought it on Amazon, then it’s probably just hemp oil and hemp oil has zero cannabinoids, which means it’s also not going to be effective. So that’s pull your customers and ask ’em what they know about CBD and then create a display, order some products from farmer and chemist and start talking to patients about it and we’ll help you with that product selection once you have some in store and you can say, try this and you have a sample, and you can have them rub it on that arthritic hand or achy shoulder and then just talk to them for four or five minutes.

(19:08):

They’ll realize that the pain goes away and you’ll have a believer right there. So part of the education, yeah, it’s pretty awesome. I mean, I don’t say that lightly because it doesn’t happen for everybody, but it’s happened so many times that it’s a really commonplace. So we’ll help you select the products that are right for you, whether those are gummies, there are zero THC products or they contain legal limits of over the counter THC. And then there’s also tons of retail support for you. So we have shelf talkers displays, informational pamphlets, dosing guides so that when you send the patient home, you can write it down on a specific card that describes the product as well as how it’s used. And then you can write notes to the patient on how they can use it. And we make it really as easy as possible to teach your patients about farmer and chemist products and what’s safe for them and how they can use it.

Shannon Battle (20:11):

Right. Perfect. Alright, well we do have many pharmacies that have shown interest and they’re still trying to decide if it will work for their business. So if there’s interest among their patient population, does pharma chemists offer a way for both our GPO members and our warehouse members to test this out in their business really at a low buy-in?

Doug S. Burgoyne (20:30):

Absolutely. So with a minimum order of $300, then we’ll send you samples and supplies that you can use. You can test them out yourselves, you can try them with patients who express interest and we think the results will be impressive. After that first small order and the information and the support that goes around that, then you’ll really be amazed at how farmer and chemists can help you improve retail sales and grow your gross margin as well as your bottom line. For IPC members, we have special pricing. We have our regular wholesale price, which we sell to other retailers, but then our IPC member special price for members only is an improvement on that. So it’s a 55% discount off the retail price. So if it’s a hundred dollars retail, then 55 of that stays in your store and 45 comes back to us. So it’s great for your margins. Our gummies have a little bit of a different discount. It’s only 35% and that’s because of the high quality good taste and the level of effort that we go into on the manufacturing margins are just smaller on gummies for us. So we still share the majority of the margin with our partners, our IPC members, but we still have to make them and we want to make them good. So they’ll sell in your stores.

(22:03):

Yeah. So we would love to work together with IPC members and be your number one source for quality CBD products. We know that it works. We know that it’s safe and we know that with education customers myths can be dispelled. And not only can we help you improve your bottom line, but you can see tremendous relief in your patients as they come back to you week after week, month after month saying, wow, that really made a difference and I’m grateful for the CBD that you helped me find.

Shannon Battle (22:37):

Absolutely. Well, Doug, it’s been a pleasure chatting today and really presenting farmer and chemists in a way that our stores can feel more comfortable. I’m sure they’ll be reaching out for more information. I know we’ve spoken with so many of our members who just aren’t quite informed enough and having that ability to provide more patient care and education within the pharmacy is so important. So on the screen here, you all can see there is a QR code. It’ll take you directly to Farmer and Chemist IPC landing page. You can also read more information there, including a product catalog. There’s additional videos and a contact form that will go directly to Farmer and chemist. We do have other webinars and blog postings on our website as well if you’d like to explore. But feel free to reach out to Doug or myself directly at that contact information there with any additional questions you all may have. And do have a great rest of your week. Thanks again, Doug.

Doug S. Burgoyne (23:27):

Thank you. Bye.