For many patients, the world of prescription medications is complicated.
While working as a pharmacist at Walgreens, Michael Rea noticed how frustrating it was for consumers. He kept getting asked the same question over and over again: Why has the cost of my drugs gone up?
The expense became so burdensome for one patient that she asked Rea which of her eight medications she should skip. Rea went home, did a bit of digging and found a way for her to save $250 per month (or $3,000 per year) on her prescriptions.
That situation was why Rea founded Rx Savings Solutions, where he now serves as CEO.
The Overland Park, Kansas-based company’s software analyzes potential medication options to find the best value and the best clinical choice for consumers.
“We’re breaking down all these complex pieces of the benefit and making the information available to consumers,” Rea said in a recent phone interview.
Though it originally launched using a direct-to-consumer model, the startup has shifted its focus and now works with health insurers and businesses to provide services to their members and employees. Clients include Quest Diagnostics, Blue Cross and Blue Shield of Kansas City, Berkshire Hathaway Media Group and American Century Investments.
Rx Savings Solutions recently announced an $18.4 million funding round led by McCarthy Capital.
“The sophistication of the software and the corresponding savings for clients are clear differentiators,” said Brian Zaversnik, vice president of McCarthy Capital, in a statement. “They are bringing pharmacy and technology together in a way that will transform the industry and bring significant efficiency to the market.”
Rea explained that about 70 percent of the funding will go toward sales and marketing efforts. The remaining 30 percent will be spent on additional software enhancements.
“From a new product standpoint, we see so many processes in the pharmacy journey that can be made better,” he added, citing examples like simplifying the process of transferring a prescription to another pharmacy.
According to a news release, the company’s membership was at 100,000 in 2015, and it expects to be serving 2 million lives by January of 2018. Rea only anticipates those numbers increasing. Rx Savings Solutions’ goal is to hit 5 million members by the end of 2018 and 50 million by the end of 2020.
“The mission of the company is to service as many members as possible and to help people in a world where they’re oftentimes a little bit guarded and don’t know who to trust and where to get information,” Rea said.
Photo: Sezeryadigar, Getty Images