Healthcare is rife with frictions – for patients, certainly, grappling with the increasing burdens of high deductibles, high drug costs and the responsibility for a growing percentage of financial liability tied to their care. In the app-driven economy, that digital front door can be key to finding discounts that can ease the financial burden in significant ways.
To that end, GoodRx, which offers an app that tracks prescription drug prices and offers coupons to get medication discounts, posted results that beat Wall Street expectations, spurred by a monthly active consumer growth rate of over 36 percent year on year to a bit more than six million.
At a high level, the company said in its earnings presentation materials, 70 percent of healthcare providers have noted that high costs are the leading reason that people do not pick up their prescriptions (the company has said that 30 percent of prescriptions are left unfilled at the pharmacy and the main reason is cost). The firm has noted on its own site that drug prices are not regulated, and prescription prices may differ by as much as $100 depending on the pharmacy. As many as 69 percent of patients have made personal sacrifices to be able to afford medications, the company has said.
GoodRx’s consolidated revenues were up more than 43 percent year over year, to $176.6 million, which was better than consensus by about $2 million. In its shareholders’ letter, the company stated that the growth in monthly users helped drive a 32 percent increase in prescription transactions revenue (where the company has a presence at more than 70,000 pharmacies) to $144.9 million.
The implication is that this metric would have been even higher. As the company said, “we believe our prescription offering continued to be impacted by COVID-19 headwinds, as many consumers deferred physician visits, increasing the undiagnosed condition backlog among Americans and negatively impacting new therapy starts and prescription volume.”
Subscription revenue grew by 125 percent year over year to $14.3 million, as the company said there was an 86 percent increase in the number of subscription plans across GoodRx Gold and Kroger Savings Club (in the economics of the latter, for example, the monthly fee is $5.99 for an individual and $9.99 for a family). The company said in its materials that its subscription segment was marked by slightly more than one million subscription plans at the end of the most recent quarter, up from 564,000 last year.
The company pointed to its recently announced pact with Surescripts, which helps prescribers choose the appropriate medication based on the patient’s ability to pay. Through the use of the Surescripts Real-Time Prescription Benefit, prescribers can give patients discount pricing at the point of care.
As to the stickiness of the prescription/platform/online/discounting model, PYMNTS’ update to the Provider Ranking of Prescription Apps found that the GoodRx app still has the top spot.