Summary List Placement
Digital health startup GoodRx is going public.
The startup, which provides telehealth and discount prescription services, filed paperwork for an initial public offering in August. It would trade on the NASDAQ under the ticker “GDRX.”
In an updated filing on Monday, GoodRx noted that it is looking to price its public offering between $24 and $28 per share. At $26, the midpoint of that range, GoodRx and its investors stand to make $900 million.
The updated filing also noted that private equity firm Silver Lake has agreed to purchase $100 million in stock coinciding with the IPO.
GoodRx now joins the growing parade of companies in healthcare and technology that have filed to go public in 2020, marking a banner year for public offerings as markets continue to surpass all-time highs.
Digital health and telehealth companies, in particular, have seen a surge in public market activity as the coronavirus pandemic has ushered in what some are calling a new era for the healthcare industry. Coronavirus-induced shutdowns have driven wary patients from doctor’s offices and waiting rooms in favor of at-home care, spurring growth in an industry that had been previously considered niche.
GoodRx’s filing came just days after telehealth giant and Teladoc competitor American Well filed to go public with $100 million in funding from Google, an unusual deal that spoke to the tech giant’s optimistic outlook on telehealth even once the pandemic subsides.
GoodRx is best known for pulling together cash prices for medications at different pharmacies as a price-comparison tool for people paying out-of-pocket, but recently added virtual visits and other elements of telehealth to its services. It has also been adding direct-to-consumer prescription services, like Lemonaid and Hims, to its comparisons.
“We spend a lot of time trying to decrease the cost of healthcare,” GoodRx cofounder and co-CEO Doug Hirsch told Business Insider in March 2019. “But if someone can make available more convenient and affordable ways to get prescriptions, that’s music to our ears.”
GoodRx’s S-1 filing provides a detailed look at its financials, risks, and vision for the future. Here are six takeaways from the filing.
GoodRx is profitable
According to Friday’s filing, GoodRx has been profitable going back to 2016, the earliest year for which it was compelled to provide financial information.
In 2019, GoodRx had operating income of $139,676,000, almost double its operating income of $77,251,000 in 2018. Revenue kept pace with increased costs in administrative areas and ultimately offset a substantial increase in sales and marketing costs incurred in 2019.
The company is an outlier among its startup peers that have long struggled to turn a profit and have even admitted in similar filings that they may never be profitable.
Although the filing doesn’t specify revenue streams, the bump in 2019 corresponded to the GoodRx’s increased interest in other avenues beyond discount drug sales, namely telehealth services and partnerships with other direct-to-consumer startups.
The pandemic has been beneficial for new users coming to its service
As the pandemic took hold in the US in the first half of 2020, users flocked to …read more
Source:: Businessinsider – Finance