Bringing Pharmacy Back Into the Black

Banner Health’s CEO of Pharmacy, Pam Nenaber, finds no bitter pill in improving pharmacy’s revenue position

Pam Nenaber isn’t a pharmacist. In fact, she started her career as a dental hygienist while completing her graduate work. However, as the CEO of Banner Health’s pharmacy division, she is a top-notch executive who is trusted with guiding the evolution of Banner’s pharmacy operations.

“Pharma is approaching 20-25 percent of healthcare spend,” Nenaber says. “Banner felt it was important to take a closer look at cost savings and potential revenue opportunities. We needed someone to lead that division who had start-up skills.”

Nenaber earned her own set of start-up skills, so to speak, in 2011, when she was CEO of a Banner hospital in Gilbert, Arizona. At the time, the organization embarked on a partnership with Houston-based cancer center MD Anderson and developed the Banner MD Anderson Cancer Center.

Today, Nenaber finds herself at the helm of a new start-up, leading initiatives such as growing a specialty pharmacy—an endeavor that involves a great deal of collaboration.

“Specialty drugs used in oncology or the treatment of other chronic conditions are highly formulated, highly regulated, and very expensive,” Nenaber says. “The manufacturers of those products are extremely selective about who they work with. They want to be sure the medications are used appropriately, that patients who receive them get the right care, and that proper reporting back to the manufacturer is maintained.”

“Pharma is approaching 20-25 percent of healthcare spend. Banner felt it was important to take a closer look at cost savings and potential revenue opportunities. We needed someone to lead that division who had start-up skills.”

For that reason, Banner joined the Excelera Specialty Pharmacy Network, which is a consortium of specialty pharma providers that is a part of ExceleraRx Corp in Minneapolis. Specialty pharma is now a fast-growing segment for Banner.

Prescription plans are typically written and managed separately from comprehensive medical plans by tightly focused third-parties. Banner, however, manages its own in-house pharmacy and sees an opportunity to take that to clients.

The Wild, Wild Southwest

Although she has lived in the Phoenix area for more than thirty-five years, Pam Nenaber is originally from Pennsylvania. Her decision to move to Arizona certainly took into account educational and career opportunities, but it was also influenced by youthful enthusiasm.

“I just got in my car and drove here,” she says “It was in the late 1970s, and having grown up in the East Coast, I thought it would be an interesting place to live.”

Nenaber met her husband, Dick, in Arizona. He is an insurance industry CEO and a transplant from the upper Midwest. For a while, they operated a restaurant that was also a country-Western performance venue, while they maintained their careers.

“Most integrated delivery systems are saying, ‘How do I do this?’” Nenaber says. “Very few are already involved. But we see an industry-wide movement toward more of this. The way we see it, we don’t need the middleman anymore.”

Expansion of Banner’s retail pharmacies is another important item on Nenaber’s list. These retail locations are in hospital lobbies and medical office
facilities system-wide. They are used by a variety of customers and provide a measurable, positive revenue stream.

“We have a considerable opportunity to serve patients who are being discharged from the hospital, Banner employees, and all members for whom we are part of their delivery system,” Nenaber explains. Efforts such as these have helped Nenaber and her team meet a company goal of bringing Banner’s pharmacy division to the positive side of the ledger. They cleared that hurdle in three years, as planned, Nenaber says.

From a personal perspective, her move to the pharmacy division had an additional attraction, one that speaks as much to helping patients as it does to improving the bottom line. It’s what drew her to healthcare in the first place.

“About 80 percent of us are taking at least one medication, and we need that medication to keep us healthy,” she says.

When Nenaber completed her graduate work, managed care was a new concept that was embraced as a way to ensure near-universal healthcare. That’s still the goal today as the industry continues to adjust to the Affordable Care Act (ACA) and braces for further changes, she says.

“The ACA really was part of a movement away from a fee-for-service model to more of a risk-management, preventive-care environment,” Nenaber says, adding that the tidal forces that brought about the ACA have not shifted enough to derail its broader initiatives. “The industry will continue to move toward a population-based risk management approach.”

And Nenaber speaks from experience. She has been with Banner and predecessor Samaritan for most of her more than thirty-year career. During that time, she has held other leadership positions including COO of Banner Medical Group, CEO of Banner Gateway Medical Center, and CEO of Banner MD Anderson Cancer Center. She was also a founding member of Banner’s Care Management division, which is focused on improving clinical care and patient safety system-wide.

A willingness to try new things and an embrace of lateral moves has helped Nenaber in her career.

“The point of a lateral move is to gain experience and exposure,” she says. “You are going to develop different skills that you can bring to the table in other situations, and you are exposed to other people, bringing you new opportunities.”

And there is no place in management for sitting back and seeing what develops. “You’ve got to be willing to raise your hand and volunteer,” Nenaber says.


Over the past six years, Banner Health and McKesson have worked together to help drive down costs, improve efficiency, and identify growth opportunities in order to focus on what matters most: patient outcomes. As a leading distributor, McKesson helps address the challenges that healthcare organizations face today, so they are better prepared for tomorrow.