Like many other services, goods, and commodities, prescription drug prices can vary widely depending on location and what particular vendor is offering them. Launching last September at the Health 2.0 Conference in San Francisco was GoodRx, a service that’s aiming to bring some transparency back to prescription drug purchases by bringing some sophisticated price comparison technology to the everyday consumer.
GoodRx was co-founded by Scott Marlette and Doug Hirsch, both early employees of Facebook. Hirsch was VP of Product at Facebook back in 2005, and Marlette, one of the company’s first 20 employees, was an engineer who worked on, among other things, Facebook’s photo application. The culture of transparency, openness, and focus on the big picture, Marlette says, had a lasting influence on him after Facebook, leading he and Hirsch to apply some of that psychology to building a better way to serve consumers with the latest pricing info from the prescription drug market.
Thus, with a web service and a free iPhone app, GoodRx is giving its users a simple prompt, where they can enter the name of a prescription drug and their zip code, whereupon the startup serves them with a list and map of prices by brand name and generic versions from both local and mail-order pharmacies.
Marlette says that the company’s database already contains over one million prices for more than 6,000 brand name and generic drugs and is growing quickly. On top of offering free, accurate price comparisons between local pharmacies, GoodRx allows customers to find discounts, free coupons, get savings tips, or set up refill reminders or get price alerts through email.
When it comes to prescription drugs, many are covered by health insurance policies, but there’s a chance that GoodRx can still save searchers money by finding prices below their co-pays, surfacing bargains in the same way Kayak does for airline tickets. While the White House has been attempting to extend healthcare coverage to millions of uninsured Americans, there are still many plans that cover only fractions of prescription drug costs, and furthermore, there are many out there who are without any coverage whatsoever. GoodRx could represent big savings for the millions of Americans who let their prescriptions go unfilled because they can’t spare the extra cash.
To boost the Los Angeles-based startup in its mission, it announced this week that it has raised over $1 million in seed capital from a host of top venture capital firms, including Founders Fund, GRP Partners, Highland Capital, SV Angel, Lerer Ventures, as well as angels like Former CEO of Drugstore.com Dawn Lepore, Mike Ovitz of Broad Beach Ventures, former President of Tribune Broadcasting Ed Wilson, among others. GoodRx is not yet sharing specific numbers, but we’ve learned from sources that the round was in fact over $1 million, which the startup will use to ramp up hiring, and continue to improve the product.
Bringing talent from Facebook, Yahoo, and others and applying time-tested consumer tech models to the prescription drug market, to give consumers an easy way to search for prices and discounts from a sizable pool (of what is intended to be every pharmacy nationwide) — could be a winning combination. It’s also great to see that GoodRx provides a Spanish-language version of its service, with access right at the top of the homepage.
One potential caveat, though, is that prescription drug prices tend to be in flux, and pharmacies are constantly changing them based on a host of criteria, meaning that it’s an enormous challenge to present prices that reflect the realtime prices offered at the actual stores.
If consumers find low prices, then call up the pharmacy only to find that the price for a specific medication is actually different from that being offered on GoodRx, well that starts to chip away at their reputation. That being said, when I searched for prescriptions I take or have taken, all were in line with what was being offered by the pharmacy, and that is music to my wallet.
GoodRx will next look to expand the site to better explain savings opportunities and cost for insured consumers, upping the educational factor, and giving users more insight into whether to choose brand name medications or generic, or how to seek out “therapeutic equivalents” to prescription drugs. Of course, in the end, consumers just want to know where they should go, and they want all the information easily accessible. That’s what GoodRx has been focusing on, and it will be interesting to see how the consumer reacts.
For more, check out GoodRx at home here. And let us know what you think.