Zipdrug sharpens its focus on medication adherence through a prescription delivery platform

Zipdrug, a venture-capital-backed business launched a couple years ago, started out with a straightforward idea: improve drug dispensing from pharmacies by offering to deliver the prescription to the patient’s home, for a $10 fee. Deliveries were to be carried out by a staff of trained couriers who could be responsible for (for example) temperature-sensitive drugs and be HIPAA-compliant regarding patient privacy. That model, intriguingly, is being pursued in various forms by newer startups, including one in Zipdrug’s native New York called Capsule, but in the meantime, Zipdrug has moved on.

Zipdrug’s current iteration, according to Stu Libby, founder and CEO, is to align closely with health plans to accomplish three goals: better adherence; cost savings for patients; and a better patient-care experience (valuable to both Zipdrug and to its health-plan partners). Health plans want better adherence in pursuit of the goal of lower overall healthcare costs; they also want to differentiate themselves, through better patient satisfaction, from the mostly economic issues when comparing one health plan to another. Zipdrug’s “medication delivery platform” now consists of a methodology to identify which pharmacies can provide a prescription at the lowest copay cost to a patient. Prescriptions are filled much of the time at independent pharmacies who have their own courier service (thus obviating Zipdrug’s need for that). The Zipdrug platform can exist as a smartphone app, but Libby notes that there are significant economic advantages currently within Medicare Advantage plans (which is of course for the elderly, but who tend not to be hip to the latest apps). Thus, the award from AARP, the retired-persons organization.

Libby says that a large part of the company’s education over the past year has been in discovering how difficult it is to obtain the best price (on a copay basis) for drugs, and how eager health plans are to provide better patient service. An (undisclosed) partnership with one regional health plan is now in place, and “more are in the pipeline,” he says. The company has delivered “hundreds of thousands” of prescriptions over the past year and because it is not doing the courier delivery, can operate essentially wherever a health plan partner does.

Quite a menagerie of delivery, dispensing or cost-comparing pharmacy services have popped up over the past couple years, attracting Silicon Valley-type venture capital (presumably on the theory that the business is ripe for disintermediation a la Amazon): Capsule, RobinHealth, PillPack, Scriptdash and others, and many more outside the US. In April, ZappRx, an online platform for expediting specialty-pharmaceutical dispensing, garnered $25 million in second-round investment from Qiming US Healthcare Fund and other West Coast investment firms. Depending on their business model, these startups can either enhance brick-and-mortar pharmacy, or mail order, or compete with them. Is there a place for pharma in all this? “We see ways in which key stakeholders in drug delivery are misaligned,” says Libby, being purposely vague, “and this can be changed.”