by clicking the arrows at the side of the page, or by using the toolbar.
by clicking anywhere on the page.
by dragging the page around when zoomed in.
by clicking anywhere on the page when zoomed in.
web sites or send emails by clicking on hyperlinks.
Email this page to a friend
Search this issue
Index - jump to page or section
Archive - view past issues
Australian Journal of Pharmacy : November 2006
company news company news Give the job to Stephen I T’S a tough gig having to explain to shareholders and stakeholders that more than $17m was missing when it wasn’t on your watch. This was Stephen Roche’s job when he agreed to take the helm of Australian Pharmaceutical Industries as chief executive officer and managing director following the depar- ture of his predecessor. It was also during a time when trading on API shares was suspended for more than a month. And just when normalcy began returning to API operations and trading on API shares recommenced, the company was blind-sided by a below-the- market price takeover offer from Sigma Company. As far as new job initiations are con- cerned, they don’t come much tougher. But Mr Roche has considerable experi- ence as a senior executive for pharmacy wholesalers during tough and uncertain times. Before joining API as head of strategic development, he was group general man- ager health services for Mayne Group and responsible for its pharmacy operations, among numerous other duties. This was after Mayne bought FH Faulding which was, at the time, the market leader among pharmacy wholesalers, and where Mr Roche was chief operating officer health- care services. Like all new company chiefs, Mr Roche wants to look to the future and not dwell on the past. He acknowledges that API’s credibility had been damaged in the mar- ketplace following its stockmarket dramas, but insists the fundamentals are in place for API to become a marketleader again. ‘API has great assets and a very strong network with successful customers and brands. With some focus, discipline and persistence there is no reason we can’t restore growth to the company.’ He also admits that, even before its run- in with the missing $17.2m, API had fought some perceptions that the com- pany was no longer pharmacy-friendly; that the execution of its retail strategy had resulted in API drifting from its tradition- ally strong support from pharmacy cus- tomers. ‘Over a number of years and for a num- ber of reasons, API did lose a bit of iden- tity in the market, but I think during 2006 the perception had already begun to turn more positive. It’s easy to forget API was established as a chemist co-operative in 1910, with a single purpose of supporting pharmacists to deliver excellent outcomes to their customers. ‘We are restoring market confidence. It isn’t something that happens instantly, but we are working in a methodical way that will stand us in a strong position in the medium term.’ While stressing the importance of proper execution of strategies and an asset management approach to managing the business, one of the key priorities to be deployed by Mr Roche will be to heighten the company’s market visibility. ‘Our people need to spend more time out in the field. It’s the best way to deal with market rumours and innuendo and most importantly it’s the only way to get to know what our customers really want.’ While he believes that API’s strategy of incorporating retail expertise with its underlying pharmacy strengths is the right way to go, he doesn’t want to down- play the importance of the company’s dis- tribution and consumer brands strategies. ‘I’ve no doubt that the franchise strategy is the right decision, which is evidenced by 58 ? THE AUSTRALIAN JOURNAL OF PHARMACY VOL.87 NOVEMBER the demand we are experiencing for for Priceline Pharmacies. Our estimates have us with 200 plus stores within the next cou- ple of years, so it appears the initial con- cerns of the market have largely been overcome and the brand already has its own momentum. But it won’t be at the expense of our other pharmacy groups nor our independent pharmacy customers. We’re committed to supporting them with a range of services. ‘We also have significant manufactur- ing capabilities to produce and market pharmacy medicines and other lifestyle products to consumers. But we’re not looking to replicate other manufacturing models in the market and won’t partici- pate in contract manufacturing,’ Mr Roche said. And on pharmacy distribution: ‘We need to manage the CSO(Community Ser- vice Obligation fundholding) and be cost- effective. I want us to partner with phar- macists in to help change the supply chain because in my view we can expect further changes from the government in 2010. ‘The pharmacy industry needs to work together on creating more efficiencies before this happens. We need an indus- try-wide collaborative and constructive platform to survive the changes in the industry and the emergence of more retail competition. The industry can’t stay as it is. ‘The supply chain we have in Australia isn’t sustainable and we need a more sen- sible approach, but without urging phar- macies to load up with stock at certain times in a month. We want to create the right balance between a truly competitive supply scenario in pharmacy without dis- rupting its community healthcare focus.’ And on the potential for API being part of a process of rationalisation among the wholesalers? While he believes the Sigma move was tactical rather than strategic, Stephen Roche is a realist about the future for the industry. ‘The sustainability of this indus- try on the current model has limitations, but any change to that in whatever form it may arrive must create value for our customers and our shareholders.’ ¦