Purchasing, or even selling, a pharmacy is a huge life choice with many moving parts. Whether you are trying to buy a new pharmacy business or sell your current one, being well-informed is imperative. You’ll be amazed at how, with the proper advice, you can make it turn out to be an easy and profitable one, too.
In this guide, we’ll break down the process of buy or sell a pharmacy, including how to prepare, what legal work will need to be done, valuing a pharmacy, and final agreements.
Buy or Sell a Pharmacy
Pharmacy Buy-Sell Should be Well-Structured. The purchase or sale of a pharmacy is a decision that should be carefully orchestrated. It’s finding the right business, in the right location, with a long-term growth potential for the buyers. For sellers, it’s all about positioning the business to appeal to qualified buyers in order to get the maximum value for it.
Working with industry professionals like Swift Trades makes this a point of order where you won’t miss any steps, stay in compliance, and get it done in a timely fashion.
For Buyers: Steps to Buy a Pharmacy
Define Your Budget and Goals
Before you begin hunting, you’ll want to figure out how much you’re ready to invest. Also, determine what type of pharmacy business you want to run:
- Retail or compounding
- Independent or chain?
- Urban, suburban, or rural area
- Specialized services (long-term care, DME)
- Search for Listings
Seeks through a pharmacy brokerage such as Swift Trades for confirmed sales pharmacies. But they can also introduce you to sellers and tell you about the financials, the patient base, and future growth potential.
Perform Due Diligence
Due diligence is critical. You’ll want to review:
- Financial records (last 3 years)
- Prescription volume
- Insurance contracts
- Licenses and certifications
- Staffing and payroll
- Lease terms
That way, you can avoid getting cold feet and can present an informed offer.
Secure Financing
You may have to finance your purchase with a business loan, SBA loan or private financing. Your lender may also want a business plan and financial projections.
Finalize the Purchase
Draft the purchase agreement with the help of a lawyer. Plus, process license transfers, register with the DEA, and notify third-party payers.
For Sellers: Steps to Sell a Pharmacy
Prepare Your Pharmacy for Sale
Before you start working on your pharmacy listings, you want to be sure your business is well-organized and profitable. Get your licenses current, wipe any legal problems, and clean up shop. Buyer’s confidence is only garnered by clean financials.
Get a Professional Valuation
Well, it’s because a proper valuation provides you with a realistic asking price. Key valuation factors include:
- Annual revenue and net income
- Prescription volume
- Location and lease terms
- Equipment and inventory
- Type of services provided (eg, compounding, DME)
Swift Trades offers expert pharmacy valuations to suit your type of pharmacy.
Market to Qualified Buyers
After your pharmacy is listed, your broker will market it to qualified, interested buyers. Keeping the sale process obscure is also important this will cause less shock to the business and its employees.
Negotiate the Terms
Have your broker and attorney work to hammer out a deal that will include:
- Sale price
- Payment terms
- Asset or stock sale structure
- Non-compete agreements
- Transition plans
- Close the Sale
Once the sale is made, close the paperwork, notify state and federal institutions, and transfer the title without a hitch.
Common Legal and Licensing Requirements
When buying or selling, you’ll have to address the following:
- Pharmacy license transfer
- DEA registration
- NPI updates
- Medicaid and insurance credentialing
- State Board of Pharmacy notifications
- Business registration, tax ID changes
These procedures are taken to help maintain legal ability and fees post-sale.
Why Work With a Pharmacy Broker?
A pharmacist‘s buy or sell is a complicated transaction that requires knowledgeable help. A reputable pharmacy broker-dealer firm like Swift Trades can help with:
- Finding qualified buyers or sellers
- Valuation and financial analysis
- Legal documentation and negotiations
- Licensing and regulatory compliance
- Doing, however, privately and not at a snail’s pace
Whether you are a first-time home buyer or you have bought homes before, buying a home is a big financial and emotional decision, and a broker should offer you the support you need to navigate both.
Final Thoughts
But if you’re buying or selling a pharmacy, it will be crucial to have a clear plan and to understand the law and work with professionals who understand the pharmacy industry. “The right team and preparation can make your transaction successful and profitable and nearly stress-free.”
Need expert help? Contact Swift Trades now to receive expert assistance when buying or selling your pharmacy the right way.