New York City-based startup Blink Health, which makes an app and online tool to help consumers find low prices on medications, has raised $90 million in Series B funding in a round led by 8VC. Previously, the company raised $75 million – also led by 8VC – bringing the company’s total funding to date at $165 million.
With the latest funding, Blink Health is focusing its efforts on scaling up its technology to reach as much of the prescription drug market as possible, and will use the capital to hire more engineers and strategize new partnerships to cover as much of the prescription medication market as possible.
“We have an extensive roadmap to create more transparency for patients,” Blink Health CEO and cofounder Geoffrey Chaiken told Babyforyou.net.ua. “Our biggest challenge is we don’t really target a niche audience, so we have to continue building a platform that can support a national footprint.”
A little more than a year after their official launch, Blink Health has rapidly attracted customers and now counts over one million active users to their app and online service. More than 100,000 doctors nationwide (about one out of every 10 prescribers) are steering their patients towards Blink’s service, which works to provide consumers with the cheapest drug prices possible regardless of insurance plans (or lack thereof). The company works with group purchasing organizations to negotiate cheaper prices with pharmacies, effectively acting as the payer on the uninsured consumer’s behalf. If Medicare Part D doesn’t cover a user’s prescription, the pharmacy can process with Blink as the primary payor, and medications paid for with Blink can also be reimbursed through FSA or HSA accounts.
Although it’s hard to pinpoint an average savings due to the variation in prescription prices depending on each individual’s plan, some users report savings of up to 90 percent.
“Blink Health has quickly emerged as the first company equipped to dismantle the opacity of the prescription drug supply chain. Technology has brought transparency and lower prices to almost every other category of commerce and it is about time that technology shines a light on the unfair prescription drug market,” 8VC founder Joe Lonsdale said in a statement. “At a time when 30 million Americans remain uninsured and 83 percent of American workers have an average health plan deductible of over $1,400, Blink Health is solving the nation’s drug pricing epidemic through technology.”
And their reach is expansive. Blink Health connects consumers with tens of thousands of pharmacies nationwide, including massive retailers like CVS, Target and Walmart. (Walgreens was also an earlier partner, but Blink Health has since stopped working with the retailer).
“Our network is now 58,000 pharmacies. That’s more than most health plans. This has become much bigger than we ever anticipated,” Chaiken said. “And our mission is to lower as many drug prices as we possibly can, because even though we knew there was a problem of unaffordable medications when we first started, we still didn’t realize how pervasive the problem was for so many patients.”
For example, Chaiken mentioned, the company learned that over half of consumers reported that they couldn’t afford life-saving medications, and 30 percent of medications are regularly left at pharmacy counters because of sticker shock.
“The pharmacy is the only retail place where you don’t know what the price is till you get to the counter, and different people pay different prices for the same thing, with richer people paying less than poor people,” he said.
Another thing the company discovered is, while many tech startups assume their first and most plentiful customers will be young people already heavily reliant on their smartphones for everyday transactions, most of their users are actually older.
“The technology is so easy that use really correlates more on need than a person’s age,” said Chaiken. “And that means an older population.”
But perhaps the most pleasantly surprising thing Blink Health has learned is branded pharmaceutical companies are also interested in working with them. While the company primarily deals in generic drugs (which represent some 90 percent of all prescriptions in the United States) they are wading into name-brand territory via partnerships with Lilly and Arbor, and plan to use the latest funding to explore more partnerships.
“The reason non-generics are attracted to us is because today, for the first time, patients are able to see the retail price for branded medication, whereas before they would only see their co-pay,” Chaiken said. “For these manufacturers, that was never supposed to be the case, as they provided the huge discounts to insurers who see the actual price, but they never had a mechanism for sharing savings with patients. Now they do.”