Two local long-term care pharmacies quickly expanded their capabilities to fill the vacuum created when Kentwood Pharmacy was shut down last month by the Drug Enforcement Administration and then filed for bankruptcy.
Dennis Moosbrugger said he and business partner Lina Kalvyte about doubled their staff to 20 at Curo Rx to meet demand from customers left in the lurch by Kentwood Pharmacy’s demise. He said the company hired several Kentwood Pharmacy workers who were not involved in any wrongdoing but found themselves out of jobs.
“It’s a blessing and a curse at the same time,” said Moosbrugger, whose business base tripled to quadrupled within one week. “Just the impact of operations — it was quite intense.”
“We had a rapid increase in sales, needless to say. It’s kind of tragic, in a way, with Kentwood’s demise, as well as all the facilities that were left pretty much medication-less for that period. Obviously, people need their medications.”
The DEA and the Food and Drug Administration raided Kentwood Pharmacy in early November, accusing it of re-packaging and selling prescription drugs that had been returned by long-term-care customers.
Neither the pharmacy nor its operator, Kim Mulder, faced any criminal charges as a result of the raid, as of last week. Michigan Department of Community Health spokesman James McCurtis Jr. said the department is conducting its own investigation.
The company, which had retail stores, as well, filed for bankruptcy Nov. 10, citing assets of $3.52 million and total claims of $12.4 million. Assets were sold Nov. 29 to Prescription Supply Inc., with Eastgate Pharmacy assets going to Wank Enterprises Inc., according to U.S. Bankruptcy Court documents.
Terry Kirkpatrick, director of pharmacy services for Saint Mary’s Health Care, said his long-term-care operations also stepped in and has picked up nearly 400 new customers. Only a few pharmacies support the specialized packaging favored by the long-term-care market, he said.
“We were trying to do as much as we could without compromising safety,” Kirkpatrick said. “We did end up taking on a sizeable number of clients that had been served by Kentwood. I suspect there’s still others that are needing service because it’s not something that just every pharmacy can pick up and do.”
Kirkpatrick said the Saint Mary’s long-term pharmacy, which employs 59 people, already was adding personnel to handle several large new accounts starting last week.
But employees of both pharmacies have been putting in long hours to accommodate the flood of new customers.
Moosbrugger, who also holds an investment in downtown Grand Rapids nightclub Bar Divani, said that within just a few years, Kentwood Pharmacy had become the market leader among several local competitors supplying custom pharmaceutical orders to facilities such as adult foster care, assisted living and nursing homes.
In fact, the company was so successful that he and Kalvyte modeled the two-year-old Curo after it, although they decided to avoid the retail market, he said. They didn’t know about Kentwood Pharmacy’s alleged re-use of medications, however.
“The front of the house was very efficient and effective,” he said. “We didn’t really have any knowledge of what was happening at the back of the house.”
Moosbrugger said Curo also stopped taking new customers for a time to catch up with the influx of orders. Curo’s inventory tripled and the business added four computer stations and two phone lines, he said. The company now needs more space, he added.
Omnicare Pharmacy, a public company that serves 47 states, also has taken on some Kentwood Pharmacy customers, a spokeswoman confirmed.
HomeTown Pharmacy, based in Newaygo with a long-term-care pharmacy in Kent County, did not return calls seeking comment.
Kent County has at least 200 licensed adult foster care homes and homes for the aged, while Ottawa County has 105. Assisted living centers are not licensed by the state.
Moosbrugger said he mailed long-term-care facilities shortly after the raid closed down Kentwood Pharmacy, offering to take on their business.
Long-term-care pharmacies fulfill orders that require customized blister packs or strips, he said, to make it easier and safer for staff members to dispense medication.
“The patients are probably the most underserved and needy in the community,” Kirkpatrick added. “They have some degree of compromise in mental status or cognitive ability or physical limitations to where they can’t take care of their own medications.”
Generally, long-term-care organizations are loathe to take on the time-consuming documentation burden of changing pharmacies, he said. Not so after the Kentwood Pharmacy raid.
“All of a sudden, their supplier is gone, dissolved, disappeared. So every home you hit the first week, they were ready to sign on,” Moosbrugger said.
Typically, the company might add customers with six or 10 beds per month. “Now you get like 800 in like a week,” he said. “It never happens that way and you can’t plan for it. But we’re working through the issues.”
Billing issues have been a particular challenge, Kirkpatrick said, because prescriptions ordered from Kentwood Pharmacy and paid by insurers must be rescinded and re-filled.
Curo Rx and Saint Mary’s serve a wide swatch of the state outside of southeastern Michigan, from Cadillac to Lansing to Muskegon and Holland.
“Kentwood was big, so with them imploding, that’s a lot of folks that were looking for a new home and the ability to pick it up in the community is limited,” Kirkpatrick said.