Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: We also continue to monitor different things that come out
Speaker 2: of the White House, and they certainly have made some
Speaker 2: comments when it comes to healthcare pharmaceuticals in the United States,
Speaker 2: which is one of the reasons we want to really
Speaker 2: get to our next guest, good X good Rx. I
Speaker 2: should say they recently reported earnings. Just a little bit
Speaker 2: of background. Shares did jump after the price the drug
Speaker 2: pricing comparison software company. They did boost their guidance for
Speaker 2: just a Ibada for the full year, falling better than
Speaker 2: expected results for the first quarter. We did see analysts saying,
Speaker 2: some of them that the Ibada beat and raised as
Speaker 2: a good start to twenty twenty five for the company.
Speaker 2: Let's get into the business and how White House policies
Speaker 2: are impacting good Rx. Wendy Barnes is president and CEO
Speaker 2: of the company. She joins us from Charlotte, North Carolina.
Speaker 2: The company, by the way, Marky Kaplin about one point
Speaker 2: four billion shares two a year to date, or down
Speaker 2: about twelve percent. They're down more than fifty percent though
Speaker 2: in the past year. Wendy, good to have you here
Speaker 2: with us. There's a lot going on in your space.
Speaker 2: But I want to talk first and start with a
Speaker 2: new initiative that you guys have actually introduced today. It's
Speaker 2: called the Community Links program. Why did you do this?
Speaker 2: What was the impetus for creating it?
Speaker 1: Hi, Carol, thanks for having me appreciate the question. So
Speaker 1: you know, I would say the company's been on a
Speaker 1: multi year journey to best partner with retail pharmacies, with
Speaker 1: community pharmacies really being at the top of that list,
Speaker 1: and this is really the culmination of that work.
Speaker 3: And so what you've referenced.
Speaker 1: The good RX Community Link is a portal by which
Speaker 1: community pharmacies sometimes referred to as independent pharmacies. So think
Speaker 1: of those as really your non chain pharmacies. They can
Speaker 1: be as small as a single pharmacy or some community
Speaker 1: independent pharmacy owners have, you know, fifty seventy five or
Speaker 1: one hundred locations, but largely they're run independent of broader
Speaker 1: management philosophy, and this is our effort to contract directly
Speaker 1: with these pharmacies in a cost plus reimbursement mechanism manner. Look,
Speaker 1: it's not any new news to you or probably to
Speaker 1: your listeners that pharmacies continue to be under reimbursement pressure,
Speaker 1: and we believe that they are key partners in our
Speaker 1: broader mission to make medications more affordable and accessible for
Speaker 1: every American. And so this effort is really one in
Speaker 1: which we're trying to bolster reimbursement for those independent pharmacies
Speaker 1: such that they can work with us directly. And in
Speaker 1: addition to that, we're giving them access to ninety plus
Speaker 1: brand deals that we have secured with pharmaceutical manufacturers over
Speaker 1: the last twelve to twenty four months, and those continue
Speaker 1: to grow such that the reimbursement on those same drugs
Speaker 1: is favorable to those pharmacies. It's really no secret that
Speaker 1: pharmacies have long struggled to have a favorable margin profile
Speaker 1: on many brands that they fill, and this too gives
Speaker 1: access to those programs for those independent pharmacies.
Speaker 4: Well, Wendy anecdotally speaking, as the large pharmacies and the
Speaker 4: chains have come under pressure, whether it's over store closures
Speaker 4: or different things happening just in the space, we've all
Speaker 4: reported on what's happened in cities and the way that
Speaker 4: some of these pharmacies have closed down in certain cities.
Speaker 4: Are you seeing more people go to these independent pharmacies.
Speaker 4: I mean, anecdotally speaking, I can say that certainly the
Speaker 4: way my family has changed its behavior just thanks to
Speaker 4: availability and what pharmacies tend to actually have what we're
Speaker 4: looking for. But how have you seen that affect the
Speaker 4: overall landscape.
Speaker 1: I don't know that we've seen a meaningful shift to
Speaker 1: independent from chain. I think there's still a pretty good
Speaker 1: mix of grosser versus independent versus chain, and candidly, you know,
Speaker 1: mail order slash digital pharmacy. I think at the end
Speaker 1: of the day, what we see is in the seventy
Speaker 1: plus odd thousand pharmacy options that we have as consumers
Speaker 1: in the US that as a consumer, you just really
Speaker 1: want to get your drugs on your own terms, whether
Speaker 1: it's mail to your home with your preferred community pharmacist
Speaker 1: or at a chain or grosser. And we pride ourselves
Speaker 1: on working really with all pharmacy such that you can
Speaker 1: get your drugs when and where you know you desire
Speaker 1: to do so.
Speaker 2: Do you see it all that the independent channel is shrinking.
Speaker 2: We've certainly seen it with some of the big pharmacy chains, right,
Speaker 2: We've talked about it, You've seen the headlines. But I'm
Speaker 2: just curious when it comes to independence, Wendy, do you
Speaker 2: see any shrinkage in terms of the number of outlets
Speaker 2: that are out There are no.
Speaker 1: You know, I will say in the numbers that we've
Speaker 1: looked at over the last couple of years, there are
Speaker 1: still a good number opening in any given month. I
Speaker 1: will say in our book, with the pharmacies that we
Speaker 1: work with, I haven't seen significant shrinkage.
Speaker 3: But I think there are certainly other data sources.
Speaker 1: That would suggest that there are a numbers of independent
Speaker 1: and or community pharmacies that are closing in or selling
Speaker 1: their business to other owners. But in our particular book,
Speaker 1: it's held pretty study.
Speaker 4: How have independence traditionally reacted to the program at GoodRx,
Speaker 4: because it's our understanding they've been a little skeptical about it.
Speaker 4: How do you make sure that they're embracing it rather
Speaker 4: than treating it with skepticism.
Speaker 1: Sure, well, I think you know, Look, it's early days,
Speaker 1: to be clear, and we're going to be on a
Speaker 1: journey here. Communication is going to be the biggest part
Speaker 1: of this program, in addition to delivering what we said
Speaker 1: we intend to deliver, which is fair economics.
Speaker 3: Over the course of these.
Speaker 1: Contractual agreements, as pharmacies agree to contract with this directly
Speaker 1: and that again can all be conveyed through that portal
Speaker 1: that we stood up this morning.
Speaker 3: So for me, it's really.
Speaker 1: Going to be about how we deliver on the reimbursement
Speaker 1: mechanism through this partnership.
Speaker 3: And I think, you know, the ongoing communication.
Speaker 1: Will support how the pharmacy community embraces this over time.
Speaker 1: You know, we've certainly been setting out communications early on.
Speaker 1: We've been in dialogue with many independent pharmacy owners to
Speaker 1: speak through the program. But I think at the end
Speaker 1: of the day, it's really going to be the outcome
Speaker 1: of the program and the economics.
Speaker 3: That we deliver that we'll prove it out over time.
Speaker 2: Well, that's why I want to kind of just dig
Speaker 2: a little bit deeper, Wendy. You know, for this to
Speaker 2: work for you guys, this new rollout, this Community Links program,
Speaker 2: the economics have to work right for the independent pharmacy.
Speaker 2: So I'm just curious what you can tell us how
Speaker 2: the economics are different for the pharmacy that directly contacts
Speaker 2: with GoodRx versus using maybe one of the pharmacy benefit
Speaker 2: managers the PBMs and their networks to dispense a prescription.
Speaker 2: What can you tell us more specifically about the economic
Speaker 2: advantage for independent pharmacies to use your route versus going
Speaker 2: to the PBMs.
Speaker 1: Sure happy to do so. So it's really the agreement
Speaker 1: directly with US is rooted.
Speaker 3: On a NAEDEK plus reimbursement.
Speaker 1: Is one of multiple benchmarks that is effectively a cost
Speaker 1: mechanism that stands for national average drug acquisition cost, and
Speaker 1: we are negotiating with independent pharmacies to do this with
Speaker 1: that predicated as the baseline, plus an amount that keeps
Speaker 1: them profitable on filling these claims.
Speaker 3: So that's really the precursor, if you.
Speaker 1: Will, and or the meat of how this agreement will work,
Speaker 1: which again provides favorable economics to these pharmacies. The distinction, Carol,
Speaker 1: as you called out to perhaps doing it through a
Speaker 1: larger payer, when you think about how it works through
Speaker 1: let's just say a larger PBM, there are multiple patient
Speaker 1: pay slash cash networks through which an independent pharmacy can participate.
Speaker 1: And when they're in that type of an algorithm, for
Speaker 1: lack of better description, typically it's going to search for
Speaker 1: not necessarily favorable margin for the pharmacy. And so there
Speaker 1: would be times in their previous arrangement, whereby they may
Speaker 1: not always have favorable economics to fill those prescriptions. And
Speaker 1: by contracting directly, we are putting terms and conditions in
Speaker 1: the agreement that allow them to have certainty around not
Speaker 1: only the reimbursement, but also access to drugs that they're
Speaker 1: not fulfilling today in patient pay programs. Again, that would
Speaker 1: be the list of brands that I mentioned that I
Speaker 1: believe are ninety plus at this point, that they're going
Speaker 1: to have certainty around how they're reimbursed in this direct
Speaker 1: engagement through us that they're not getting through their arrangements today.
Speaker 4: Hey, Wendy, we're watching everything happening outside of Washington and
Speaker 4: coming out of Washington really closely. We're expected to hear
Speaker 4: from the President in just a few minutes. There's an
Speaker 4: event happening in the Oval Office that's about a kid
Speaker 4: account event scheduled. It was scheduled for two pm. We
Speaker 4: understand the press pool has gathered. If the President starts
Speaker 4: to take questions, we will certainly go there. In the meantime,
Speaker 4: thinking about healthcare in the United States, it is inextricably
Speaker 4: bound to politics, no question. If what the President calls
Speaker 4: the big beautiful bill were to pass, we could see
Speaker 4: at least, according to the CBO estimates of a dramatic
Speaker 4: increase in the number of uninsured almost eight million. What
Speaker 4: does that mean for your business and how much of
Speaker 4: your business comes from medicaid and uninsured people today?
Speaker 1: So interestingly, of the users who access our pricing on
Speaker 1: any given day, roughly ninety percent actually have insurance today.
Speaker 1: So I think there's a bit of a misperception that
Speaker 1: the overwhelming number of consumers who use us in fact
Speaker 1: don't have insurance, which is not the case.
Speaker 3: Having said that, who does.
Speaker 1: Come and look for pricing through our different platforms is
Speaker 1: your consumer who's motivated to check for competitive pricing, whether
Speaker 1: they have insurance or not. And we continue to be
Speaker 1: the number one platform to look for the best price
Speaker 1: deal that you can find on any particular medication. And
Speaker 1: so as it pertains to what may or may not
Speaker 1: pass in the bill, whether it's inclusive of Medicaid cuts
Speaker 1: which continue to be advanced, and or other cuts that
Speaker 1: would put pressure on your typical household income, what we
Speaker 1: do know is that those should produce tailwinds for us
Speaker 1: as a business. For consumers, whether they're insured or not,
Speaker 1: but specifically as it relates to Medicaid cuts and the
Speaker 1: number of individuals that may fall out of coverage. We
Speaker 1: do believe that that presents an opportunity for us to
Speaker 1: continue to support any American that really is struggling to
Speaker 1: purchase their medications.
Speaker 2: Wendy, just got thirty seconds. You know, the word that
Speaker 2: we all use to describe the environment right now is uncertain.
Speaker 2: There's a lot coming out, certainly leaders and CEOs. Just
Speaker 2: in your industry too. You've got write Aid doing a bankruptcy.
Speaker 2: You know, I think about the macro within your business
Speaker 2: and just macro overall. Just got about twenty five seconds.
Speaker 2: How do you look at the outlook?
Speaker 3: Just quickly, you know the outlook?
Speaker 1: You're right, turbulent is a fair description. Having said that,
Speaker 1: businesses that stay the course and have a mission that
Speaker 1: makes sense for the consumers in which we serve.
Speaker 3: Will continue to thrive.
Speaker 1: And our goal, of course is getting medication affordably and
Speaker 1: effectively into the hands of every American who need it,
Speaker 1: and we believe it will be in a position to
Speaker 1: take advantage.
Speaker 2: Wendy Barnes, President CEO OFRX