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Your Pharmacy Financing Solution From First Financial Bank

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Your Pharmacy Financing Solution From First Financial Bank

Clearing the path to pharmacy ownership with industry knowledge and personalized service.


Pharmacy ownership is a big step that commonly requires gathering large sums of money in the form of bank loans. It can be difficult for prospective pharmacy owners to secure commercial loans because most banks are asset-based lenders.

One of an existing pharmacy’s biggest assets is the prescription files. Without understanding how pharmacies operate, commercial banks can place little value on these “blue sky” assets, despite their worth of potentially many hundreds of thousands of dollars.

First Financial Bank (FFB) is a customer-oriented community bank headquartered in El Dorado, Arkansas, and a national lender that specializes in industry-specific loans to pharmacists and veterinarians. Their pharmacy lending team includes current and past pharmacy owners with more than 75 years of combined pharmacy experience. Their expertise in working with independent pharmacies allows them to offer a range of flexible terms tailored to the unique situation of pharmacy ownership


Mike Patel recalls a business class he took in pharmacy school. “The professor said there was no money in pharmacy ownership. He told us we needed to earn doctorates and do clinical pharmacy to be successful. I assumed he knew what he was talking about.”

Nearly a decade later, Patel was working in retail pharmacy and looking for an opportunity. He was still interested in owning a business, but couldn’t shake the professor’s negative prediction. A friend remarked that the professor had probably never owned a business himself. Patel took that point to heart and decided to talk to a few independent pharmacy owners. The first pharmacist he approached was very encouraging. “He told me, by owning a pharmacy I would be giving myself a raise from day one.” That was all the encouragement Patel needed.


Patel is now owner/operator of 15 stores in five states, including two startups, that span LTC, infusion, sterile compounding (503A), and specialty pharmacy. He first entered into pharmacy ownership in 2005 in the Palm Beach area. “I remember trying to do this type of loan with another bank in the past,” he said, “and it felt like talking to someone who had no idea of what I was trying to present.”

Out of more than 3,000 banks in the U.S., First Financial is one of only a handful of lenders who operate in the pharmacy space. “One of the biggest reasons I chose First Financial was their experience in this market,” Patel said.

Pharmacy cashflow is notably different from other small businesses. Accounts receivable and accounts payable operate on longer timelines, which many banks don’t understand. That lack of knowledge can delay the loan process and potentially thwart a purchase. “A lot of pharmacy sellers don’t want to wait six months [for a deal to happen],” Patel said. “First Financial was extremely efficient.”

Pharmacy loans can also be quite large. “A lot of banks see the size of those numbers and they just aren’t comfortable with that,” Patel said.

Interestingly, less than 1% of loans for independent pharmacies have failed. “This is actually a great success rate for banks and lending,” said Bob Graul, Managing Director of Business Development for First Financial Bank.


First Financial wants their borrowers to succeed at pharmacy ownership. The loan officers’ industry expertise equips them to do just that in a number of ways.

“After you do your own due diligence, you get a second set of eyes to go over your work,” Patel said. Those extra eyes offer more than a quality check; your FFB lender also provides industry insights that are crucial for someone starting out.

And when it comes to negotiating a purchase, once again, First Financial’s pharmacy-specific experience delivers added value to the borrower. “They have seen so many deals and so many pharmacy types,” Patel said. “They know all about gross profit.”

This kind of insider market knowledge is a perk of the ongoing, mutually beneficial relationships that First Financial’s lenders tend to have with their clients. One successful venture often leads to another when you have guidance from loan officers who are so immersed in their field.


Beyond the numbers, using First Financial for a pharmacy loan makes good business sense. “You get more bang for your buck,” as Patel put it. “The advice they provide will improve your whole business plan. For me, that meant gearing efforts toward specialized pharmacies that are less retail-based."

Pharmacy ownership can be very rewarding, in every sense of the word. “Helping customers with their health carries a tremendous weight,” Patel said. First Financial understands the dollars and cents involved in providing good pharmacy care. Your lender will work with you, one-on-one, every step of the way through the pharmacy loan process, so that you can ultimately focus on your patients. 

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