Featured Leader: Andy Johnson

Finding his nicheAndy Johnson

The best thing that can happen to a thinking person,” said Andy Johnson, “is to lose their security blanket and have to re-think their opportunities.”

Johnson’s career shows a lifetime of leaving the security blanket behind to explore opportunities, develop relationships, navigate inevitable change – and find success in it.

Johnson worked his way through pharmacy school, and after graduating in 1954, worked for two more years before purchasing a community pharmacy in Olivia, Minn. Unfortunately, the pharmacy – unbeknownst to Johnson – was bankrupt.

“After making a dumb business decision and working to get out of it, I thought management technique was really important. It wasn’t innate; you either learned it educationally or you learned it the hard way.”

Once establishing his store “where I could get my nose out of it,” Johnson expanded his interests. He joined the Minnesota State Pharmacists Association (MSPhA) and accepted a position on its Board of Directors.

During his tenure, two computer programmers approached the board with a proposal to develop a proprietary pharmacy system with the association’s blessing. The board turned it down, but Johnson picked up the idea. “I was thinking I should get a computer in the pharmacy. I thought it would be interesting to work with them.”

Johnson met with the developers for 18 months to write the program. At the end, “I was a programmer. I couldn’t do it well, but I could follow what they were talking about. I got into the computer age.”

Writing the program was easy, Johnson discovered – the hard part was supporting it.

At the time, Johnson owned two Snyder Pharmacies and wanted them on the same system. He approached the president of Snyder Drug Stores with the idea of installing Honeywell systems in their corporate pharmacies and successfully negotiated the deal with Honeywell to sell 62 systems to Snyder. “The kicker was, for a better price, I contracted for 100 systems and started a side business of selling systems to other Snyder independent pharmacies.”

Johnson calls it the way he “backed into” corporate pharmacy.

In the late 1980s, after owning and managing community pharmacies for 31 years, Johnson sold his remaining two pharmacies and prepared to retire.

But his next career was just beginning. A week later he was invited to work on development projects for Snyder Drug Stores. While there, he created a system for in-house Prescription Benefit Management (PBM). When they parted ways, Johnson took the PBM idea with him.

“To be a PBM you have to have customers and process claims. I had neither.” He worked with several local HMOs and employers, contracting out the claims processing to a national firm, and then partnered with a friend and a programmer at a computer timeshare company to develop an independent pharmacy claims processing system.

Around this time, Johnson’s friend John Middleton, who was working with United Health Care’s Diversified Pharmaceutical Services (DPS) to contract individual network services for HMOs, asked Johnson if he would like to help them build a national network. Johnson accepted the challenge and created the first broad-based national network, with a single discounted rate, into which a client’s employees could be added without pharmacy notification.

“It was a ball,” Johnson recalls. “With an HMO, you are giving one chain an advantage over others. With a national network you can’t do that. We had to change two things – contract with each chain for all the locations they have, and give them a little more money. The chains weren’t crazy about doing a network with us that we could just plug people into it – they had never done this before. Sooner or later they all came around.”

Johnson was the 25th employee hired at DPS. Five years later, just before DPS was sold, he hired the 700th employee.

Johnson attempted retirement again, but soon took a director position at MedCo Health Services, where he stayed until 1999.

“Andy’s not a teacher in terms of sitting you down and lecturing you,” said Cal Corum, who worked with Johnson at Medco. “It’s much more by example and counsel. One of the lessons I learned from Andy is that you need to be straightforward and clear. At the end of the day, the only thing you have is your credibility.”

Johnson then moved to Arizona with his wife Mary, to whom he has been married 54 years. They have three grown children, Drew, Keith and Leslie. He continues to consult and currently works with Cardinal Health.

Much of Johnson’s success he attributes to finding his niche. “I understand independent and chain pharmacy. Not only operationally, but also the mentality. The people you’re dealing with, they depend on you, you depend on them. This is a personal relationship. If you want this to be a business relationship, you’re doing it the hard way.”

This Featured Leader is part of an ongoing series from the Center for Leading Healthcare Change that profiles pharmacy leaders in the community.