Amersham Health assembles largest radiopharmacy network

March 6, 2002

Alliances provide the bulk of distribution pointsAmersham Health has stitched together the largest network of radiopharmacies in the nation in an effort to create broad geographic coverage, according to company executives. Despite

Alliances provide the bulk of distribution points

Amersham Health has stitched together the largest network of radiopharmacies in the nation in an effort to create broad geographic coverage, according to company executives. Despite this expansive network, Amersham Health is not the largest company in the radiopharmacy industry, however, nor does it own the most radiopharmacies.

The paradox comes from the method used by Amersham to create its network of 178 radiopharmacies. Over the last several years, the U.K.-based company with North American headquarters in Princeton, NJ, has struck a series of alliances.

Amersham owns just 25 of the 178 radiopharmacies in its network, said Thomas Giordano, executive vice president and general manager for Amersham Health in North America. Of the remainder, United Pharmacy Partners has an alliance of 46; Tyco International's Mallinckrodt Division has 40; Central Pharmacy Services has 34; and Geodax has 16. Amersham has also contracted with 17 independent pharmacies.

"Our network is unique in that it is made up of both company-owned radiopharmacies and a large alliance of pharmacy partners," Giordano said.

The expanded network is designed to improve customer access to Amersham Health radiopharmaceuticals, including Myoview (technetium-99m tetrofosmin), the company's cardiac perfusion imaging agent.

"Our objective was simple: to ensure that Amersham Health proprietary radiopharmaceutical products are conveniently available to the nation's healthcare providers," Giordano said. "This requires broad geographic coverage and a full line of product offerings."

Wide geographic coverage usually confers a competitive edge, particularly when products are time-sensitive and require special handling. Radiopharmacies would seem to fit the bill, as most radiopharmaceuticals have a very short half-life and require patient-specific compounding.

But Amersham Health's reliance on partners mitigates this advantage. Rival Syncor International, the acknowledged industry leader with 131 radiopharmacies, said that Amersham's claim of having the largest radiopharmacy network in the U.S. could give people the wrong idea.

"Everyone kind of works with everyone else in this industry, so it's not hard to say that you can get an Amersham product through an independent nuclear pharmacy or through Mallinckrodt's distribution channel or CPSI," said Bill Powell, director of investor relations for Syncor.

Amersham Health is not the industry leader, Powell said. The company never claimed it was, Giordano said.

"We have been very clear that we're talking about a network that includes company-owned pharmacies and a large alliance of pharmacy partners," he said. "I don't think anything we said is incorrect. We're just talking about two different things."

Wide geographic penetration is essential for companies like Amersham Health and Syncor, which must supply radiopharmaceuticals to physicians promptly when these imaging agents are needed. Amersham created its network of 178 radiopharmacies to improve customer service, Giordano said. This is the goal behind the development of any network designed to distribute radioactive materials for medical imaging, Powell said.

"Radiopharmaceuticals are like ice cubes-they begin to lose their essence as soon as you take them out of the box," Powell said. "If you are working with people who don't have the wherewithal to deliver the drug that you need in the time that you need it, you have a problem."

Amersham Health simply chose to provide coverage and to enhance customer service using existing resources, Giordano said.

"It's important to have the broadest coverage you can," he said. "If you cover only 70% or 60% of the country, you're going to be able to service only a percentage of the customers."