At Duke Health, pharmacy leaders say the era of easy cost savings is over.
“All the low-hanging fruit has been hit,” said Roya Tran, PharmD, associate chief pharmacy officer for pharmacy finance and supply chain at the Durham, N.C.-based health system, said on the “Becker’s Pharmacy Leadership Podcast.”
That reality is reshaping how Duke approaches pharmacy finance. Instead of relying on incremental cuts or one-time savings, Dr. Tran said the focus has shifted to more complex and structural work: reimbursement optimization, purchasing strategy, biosimilar alignment and tighter coordination between clinical and financial teams.
Over the past year, Duke implemented a new purchasing analytics platform to improve visibility into contracts, utilization and product selection. Within six months, the tool helped generate about $1 million in drug expense savings, Dr. Tran said, but she emphasized that the larger value lies in improving decision-making and purchasing processes.
“We now have a tool as well as a team that can effectively look at data and respond in a more proactive and strategic manner, instead of being reactive,” Dr. Tran said.
Rather than leaving those decisions siloed, Duke created a cross-functional group that includes pharmacy, supply chain and operational leaders to review data, escalate issues and align purchasing choices across sites. The goal is to move from reactive adjustments to more consistent, data-informed decisions, Dr. Tran said.
At the same time, pharmacy leaders are preparing for continued volatility tied to drug pricing policy. Dr. Tran pointed to uncertainty around 340B and Inflation Reduction Act rebate changes, noting that policy shifts can happen quickly and require systems to stay flexible.
“I’ve done 340B long enough to know there’s going to be changes overnight,” she said. “We still have to be prepared to respond, so all the work that we did leading up to it still continues to ensure that we are ready for it if that time comes.”
With fewer easy cost levers available, Dr. Tran said health systems may need to think differently about how they approach formularies and biosimilars — especially across inpatient, ambulatory and retail settings. She described growing pressure to move toward broader standardization, while acknowledging that payer structures and operational complexity can make alignment difficult.
“I think we need to get to a point where we can put ourselves in a spot of leverage to work with what’s best for the patients and the health system,” she said.
That kind of leverage depends not only on contracts and pricing but on clinical engagement, including prescribing practices and collaboration between clinicians, pharmacy teams and revenue cycle leaders.
Staffing constraints are also shaping strategy. With limited ability to add headcount, Duke is looking to technology, including analytics tools and emerging AI capabilities, to help teams manage growing complexity.
On the growth side, Dr. Tran said Duke is expanding specialty pharmacy and ambulatory pharmacy services, with a focus on keeping care within the organization’s EMR and pharmacy infrastructure. She also referenced exploration of new facilities and distribution models to support that expansion.
