How Telemedicine Has Made Generic Drugs Sexy
Since 2017, Direct-to-Consumer (DTC) startups (some engaged by Five Rivers RX!) have cropped up to market and supply drugs to patients across the United States. The product portfolio is not too exciting – including generic sildenafil and finasteride – but their growth in revenue and valuation absolutely is.
Investors are pouring hundreds of millions into the likes of HIMS, Keeps, and Roman – and it all comes down to the wider acceptance of telemedicine. Telemedicine, the remote diagnosis and treatment of patients, is being uniquely applied in the development of this unique industry which makes it easy for patients to get prescription drugs without a doctor visit. Probably for the first time, generic drug products are being marketed through splashy subway ads, viral social media marketing, and even Superbowl commercials.
Current and Future Impact (Hint: Big Pharma NOT CPG Companies)
From a supply chain perspective, it likely won’t create a huge disruption. The new model is limited to very specific categories that are well suited to patients being provided care remotely (diagnoses being provided using video and picture). The market is also limited to cash payment – without a doubt, insurance companies and PBM’s would make life difficult for any company that attempts to bill insurance for the products. It’s also important to note that these startups rely on consumers self-diagnosing, whereas a doctor is usually required to diagnose for most other health issues.
However, with state regulation of telemedicine relaxing and telemedicine technology advancing, there is still a lot of room to grow – and Big Pharma has noticed. Bausch Health (formerly Valeant Pharmaceuticals) launched Dermatology.com in March 2019 to market their portfolio of products spanning Aging, Acne, Discomfort, Scalp, and Wound Care. In February 2020, the company added the telemedicine component – patients can now upload pictures and work with a doctor to get the product shipped directly to them, without ever leaving the house.
More as it breaks!
Image via PYA, P.C.