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GoodRx S-1
- zumachase 6y agoWow...an S-1 with positive net income.
- dogma1138 6y agoYes but they don’t really have a way to expand outside of the US, they are basically an answer to a uniquely American problem unless they’ll go they’ll target the self medicating crowd that uses the relatively dodgy online questionnaire/chat prescription pharmacies.
- wins32767 6y agoSo they're a mature, profitable company going public and that's a "Yes, but..."?
- oxymoran 6y agoThey seem pretty vulnerable to being obsolete if there is any sort of substantial change in the prescription drug market. And there seems to be quite a push to change the prescription drug market. Just look at how convoluted their revenue generation is, there are like 5 middle men.
- takeda 6y agoThat's why they use the money that they mad to hire lobbyists to ensure that policies won't change in any meaningful way. I hate how this world works :/
- disillusioned 6y agoThis is true of basically any major healthcare play. On the (at this point extremely) off chance that we move to single payer, for instance, insurance companies face an existential crisis. On the off chance that we fix prescription drug price gouging and absurdly inconsistent pricing and all of these problems that GoodRx solves for patients simply by _cutting them in on the scam a bit_, then GoodRx faces an existential crisis. The fact that there are 5 middle men is... more of a moat in this case? They've solved a complex, intractable problem profitably. Does this mean they're a 20-year company? Eh, not without some significant additional revenue streams or pivots into different areas, and to that point I agree with you about their vulnerability. But for the next 10 years? These are good margins building a business that only incrementally reduces the fucking over of the consumer.
- chimeracoder 6y ago> Yes but they don’t really have a way to expand outside of the US, they are basically an answer to a uniquely American problem The US accounts for 45% of global pharmaceutical sales. Even if they're limited to "only" half of the global pharmaceutical market, that doesn't sound like the worst position to be in.
- dogma1138 6y agoI think that’s for North American and it’s in revenue not in actual sales, but yes that is currently the case but it’s also clear that the US health system cannot continue as it does for much longer. So overall while they can clearly profitably operate in the current market I’m not so sure about their longevity.
- gvhst 6y agoThe market size and business opportunity is not measured by units sold but by overall revenue. Am I missing something?
- dogma1138 6y agoYes you are missing the point that this company can only operate because of just how utterly broken the US healthcare system is, and sooner rather than later there will be sufficient political pressure to change that.
- edoceo 6y agoBecause their risk is dramatic health-care reform? In the USA?
- dogma1138 6y agoMedicaid for All almost made it into the Democratic Party manifesto this time, it was cut but realistically it will make it into the 2024 or 2028 one especially once the longer term effects of COVID-19 will be more apparent because many of the recovered will suffer long lasting effects potentially for the rest of their (hopefully long) lives, and overall once all the bullshit settles down people will see it as a pretty good wake up call.
- Judgmentality 6y agoYeah, because the American market is so inconsequential. They're barely pocketing tens of millions each year - it might be 1 or 2 years before they break a hundred million in annual profit! Fuck this company - let's put more billions into the cash fire that is Uber.
- dogma1138 6y agoThe issue I’m seeing is that many people would prefer a US where a company like that couldn’t exist, and yes the Dems killed Medicaid for All from their manifesto for this round but I’ll wager that the US will move towards universal and single payer system within the next 10 years.
- Judgmentality 6y agoAdmittedly my comment was snarky, but you're speaking of ideals and we're speaking of solutions. Right now GoodRx is a very successful company solving a very real problem. Meanwhile the US government has completely fucking failed to fix it's healthcare issue. You can keep waiting for a government solution. In the meantime I will continue to be a happy customer of GoodRx.
- dragonwriter 6y ago> yes the Dems killed Medicaid for All from their manifesto for this round “Medicare for All”, and while it's not part of the current platform (which focussed on a public option), removing federal program barriers to states enacting universal plans while participating in the various federal plans is part of the platform, and state policies providing models for federal progress is a common thing. But, more immediately, even without Medicare for All, the Democratic 2020 has a plan for universality centered around a public zero-deductible option that all Americans would be able to buy into via existing exchanges and with existing exchange subsidies and some low income Americana would be enrolled in automatically with no premiums.
- hakfoo 6y agoMy father went into his chosen profession because he expected the US to get on the universal health care bandwagon imminently. That was in 1970.
- ponker 6y agoThis is not really a problem. If they were in a situation where they didn't have a way to expand outside of say, Burundi, that would be a problem, but the US is 25% of the global economy.
- manigandham 6y agoWhy is that a problem? Companies don’t need to be international.
- tiffanyh 6y ago> “ Our revenue has grown at a compound annual growth rate, or CAGR, of 57% since 2016, and reached $388 million in 2019, up from $250 million in 2018. Our net income was $66 million in 2019, up from $44 million in 2018, and our Adjusted EBITDA was $160 million in 2019, up from $128 million in 2018. Our revenue grew 48% in the first half of 2020 to $257 million, up from $173 million in the first half of 2019. Our net income was $55 million in the first half of 2020, up from $31 million in the first half of 2019, and our Adjusted EBITDA was $101 million in the first half of 2020, up from $75 million in the first half of 2019.” Wow, that’s some healthy margins. Profitable for the last few years with strong growth on both top line and bottom line.
- marrone12 6y agoAnd not just gross margins, actual ebitda profitability!
- tempsy 6y agoseems like it'd be sensitive to changes in healthcare policy as someone else mentioned eg step changes in drug pricing regulation that would make it less useful for someone to comparison shop drugs even with insurance. in a sense, they try to solve a huge problem with our healthcare system with duct tape when fundamental change needs to come from policymakers to create "real" change.
- 1123581321 6y agoThey are also dependent on large pharmaceutical chains to accept GoodRx. Walgreens and CVS make little money on those prescriptions, and may lose money, and on top of that need to do more POS data entry to accept the coupon, so they only accept GoodRx to make customers happy and get store foot traffic. That’s not to say the situation is unstable for GoodRx but it is a risk.
- marrone12 6y agoIt's not much more data entry than entering in an insurance card. But yes, they are dependent on being accepted by large chains. I believe GoodRX was not accepted at CVS for a long time
- aantix 6y agoHow do they get prescription prices so low? And why can't insurance companies negotiate similar deals?
- lotsofpulp 6y agoThey sell data. They might even assist insurance companies because I don’t think purchases made via GoodRx apply towards deductible/out of pocket maximum.
- xoxoy 6y agodrug companies frequently provide rebates as a way to keep prices high to insurance companies but lower out of pocket costs to individuals - I think they do the leg work to automatically source these coupons for you and get some sort of kickback from the drug company
- aantix 6y agoWhat's the motivation behind this? Is it really to provide a break to the individually uninsured?
- kevindong 6y agoWho do they sell the data to? It's certainly not the insurer/consumer/PBM/pharmacy. Each of those groups already has near total visibility as is.
- deleted 6y ago[deleted]
- lotsofpulp 6y agoSupposedly drug companies according to this pharmacist around 5 min mark: https://youtu.be/bUVbX3-gOWc https://youtu.be/bUVbX3-gOWc I am not sure either, but I can’t figure out what other play there is than selling data.
- 6y ago
- orbitmech 6y agoIf anyone else is curious on GoodRX’s business model, here is a good write up I found from HBS https://digital.hbs.edu/platform-digit/submission/goodrx-or-greatrx/ https://digital.hbs.edu/platform-digit/submission/goodrx-or-...
- sam36 6y agoI don't think that is the full truth. Everyone in the industry seems to see goodrx as dishonest and they all state the same story similar to this recent one from reddit[0]. In my personal experience, the goodrx "coupon" for my drug was $30. Sure enough, at the pharmacy, I was charged $30. But if I use the same coupon the next month, the price is magically $57. I could print out a new coupon every time, but the process with the pharm tech to change to a different "drug card" (which is what they see it as) is nearly a 5 minute process. By contrast, my state offers their own group drug card, and the charge is usually around $45. It might go up or down by a few dollars every 6 months, but that is it. [0]: https://www.reddit.com/r/explainlikeimfive/comments/ih4ziy/eli5_how_do_companies_like_goodrx_discount_your/g2yhhz1/ https://www.reddit.com/r/explainlikeimfive/comments/ih4ziy/e...
- JMTQp8lwXL 6y agoThe drug price changed, independent of your usage of the coupon. In my experience, I have used GoodRx for years and paid the same price always.
- aj7 6y agoI’ve seen ca. 6-month price changes, and a complete reordering of the price ranking among pharmacies. Just go to the new pharmacy and have them transfer the Rx.
- marrone12 6y agoThat comment does not understand how pharmacies get paid. The patient pay amount is irrelevant to how much the pharmacy makes. Pharmacies make money from prescription dispensing fees, which are generally around 1-2 dollars. PBMs are the ones that make money on patient pay amounts and are the same ones that pay the wholesalers, and they have different payout contracts depending on which card is being used. GoodRx relies on these PBMs for business, who have done the math on the arbitrage being in their favor. Source: I worked at a GoodRX competitor a couple years ago.
- justicezyx 6y agoMaking profit off human well-being, I consider this a flaw of the capitalism. There should be an easier fix than introducing another private for profit entity in the health care system.
- bhupy 6y agoAren't food companies and grocery stores in the business of profiting off human well-being?
- adamnemecek 6y agoNo, as they have very low margins.
- bhupy 6y agoRight. The goal here is to make healthcare a low margin business also. High margins are an indicator of a lack of competition.
- dzonga 6y agoone of the few companies to file an s-1 recently with healthy numbers. cash flow positive. profits. and considering state of us health care, I would buy stock in this company
- rvz 6y agoThere you go. Actual numbers showing profitability on day 1 on IPO and none of that "We may never reach profitability" disclaimer notices from bullshit hyped startups out there racing to the stock market with only gigantic losses to show; quarter after quarter. What I see about GoodRx is sustainable and they are not even trying. I would gladly buy this stock.
- arcticbull 6y agoI absolutely hate GoodRx. Its a symptom of a horrifying lack of medical coverage and care in this country. If it actually becomes incredibly successful it will embody the same perverse incentive structure as Intuit -- to remain successful they would be best served by lobbying against universal healthcare and affordable medicine in general so their offerings remain valuable. In the same way Intuit lobbies against simplifying the tax code. Every time this happens it further entrenches the existing nightmare. Medicine in this country needs wholesale reform, not coupon clipping for insulin. [edit] Coupon clipping for life saving medicine is apparently as good an S-1 as it would be a Black Mirror episode.
- JMTQp8lwXL 6y agoWhile I agree, in the short term, the existence of GoodRx is probably better than not. It's expanding access to prescription drugs, even if in a sub-optimal way. Perfect is the enemy of good.
- arcticbull 6y agoIn the same way heroin, in the short term, solves your homelessness problem.
- metiscus 6y agoBut heroin doesn't solve your homelessness problem at all unless you mean by killing the takers but that is very different from providing medicine affordably to people. What did I miss?
- arcticbull 6y agoGoodRx doesn’t solve affordability either it papers over it by giving a small handful of people access to affordable prices, while putting themselves in a position to lock in the status quo — ultimately solving nothing for everyone.
- 6y ago
- ck2 6y agoImagine the wild level of data they have on the US population, every person with an illness or disease, their name, address, dob, everything in a billing requirement. The only problem is it is likely many more people without insurance than with because of the nature of their product. If that database ever leaks, wow there will be hell to pay, or maybe not, hasn't really been in the past, did people ever get their $100 payout for the other leaks? https://www.consumerreports.org/health-privacy/goodrx-shares-users-health-data-with-google-facebook-others/ https://www.consumerreports.org/health-privacy/goodrx-shares...
- Someone1234 6y agoGoodRx/Coupons creates some odd problems/interactions with insurance. We were prescribed liquid Tamiflu (Oseltamivir) for a child with the flu. We have high deductible health insurance. The insurance "discount" cost was $105. The GoodRx price was $40. But this creates an odd and illogical conflict: Hypothetically we should always pay the lower price, but the higher price counts towards our insurance yearly deductible and out-of-pocket maximum, whereas the GoodRx price does not. So we have a type of insurance specifically designed to encourage us to find cheaper medical services, but GoodRx undercuts the insurance itself, forcing us to choose between our deductible and the rational price. The US should just outright ban insurance "discounts" (which are a fiction anyway). That way everyone pays just one price: Cash, insurance, Medicaid, or whatever. Plus then medical providers can actually publish realistic price lists instead of fiction with "discounts" on the fiction.
- nvahalik 6y agoWe don’t have insurance. We find the lowest price and pay it. This year alone we’ve saved thousands using stuff like GoodRx and just paying cash. Edit: not to mention no premiums.
- Someone1234 6y agoWhich is helpful, but you shouldn't be in that position and it is really just a dice roll away from becoming unsustainable. The system is horribly broken. GoodRx helps people, but GoodRx are a symptom of a much bigger problem rather than a solution.
- JMTQp8lwXL 6y agoIt's a strategy that works for the small things: a doctor's visit for the flu, ubiquitously manufactured cheap prescription drugs, etc. It's when you face a real medical emergency and have a six-figure hospital bill, that you truly need health insurance.
- klenwell 6y agoNPR reported a story like this this week: https://www.npr.org/sections/health-shots/2020/08/25/904517805/veterans-appendectomy-launches-excruciating-months-long-battle-over-bill https://www.npr.org/sections/health-shots/2020/08/25/9045178... They are not hard to find. This one also included some dodgy billing practices by the medical provider. Consistent with industry standards.
- petespeed 6y agoI was searching for their revenue model. Here is what page 21 of S1 says: "To date, the vast majority of our revenue has been .. derived from our prescription offering. When a consumer uses a GoodRx code to fill a prescription and saves money compared to the list price at that pharmacy, we receive fees from our partners, primarily PBMs. Revenue from our prescription offering represented 97% and 94% of our revenue for 2018 and 2019, respectively, and 95% and 91% for the first half of 2019 and 2020, respectively."
- RyanShook 6y agoOther than the app, how is GoodRX’s business model different from the multiple other discount cards out there? What did they figure out that non of the others did?
- refurb 6y agoI know a few pharmacists and they hate GoodRx. Why? Because of the added fee on top of the discount. They often end up underwater (losing money on the Rx). I've even heard of some pharmacies doing a "cash price" match of GoodRx. Customer is happy (still get lower price) and the pharmacy is happy (they don't pay the GoodRx fee). Makes me wonder about the longevity of the business model.
- nixass 6y agoReading comments like this always reminds me how fucked up US healthcare (and not only healthcare) system is. God bless CoMmUniSt EU