In a competitive digital health market, startups move to add new medication delivery services

In an increasingly competitive digital health market, many virtual care startups are moving into prescription drug delivery as a key area of growth.

Last week, Ginger announced a tie-up with digital pharmacy startup Capsule for at-home delivery of prescription mental health medications. Ginger will provide members with free, same-day, contactless delivery for necessary mental health medications starting with the New York City, Chicago, Minneapolis, Boston and Austin markets.

With Capsule’s technology platform, Ginger’s prescribing psychiatrists will have visibility into medication fill rates, associated adverse events and other data necessary to ensure the safety, efficacy and appropriateness of members’ medication regimens, the company said.

Eric Kinariwala, founder and CEO of Capsule, said the partnership brings together Capsule’s technology platform and application programming interfaces with Ginger’s on-demand mental health system to drive better health outcomes and lower costs for patients and employers alike.

One of the greatest challenges providers face in psychiatry, exacerbated by the high demand for care during COVID-19, is the information gap between provider prescriptions and patient use. This can lead to increased risks of medication mismanagement and poor outcomes, said Jon Kole, M.D., director of psychiatry at Ginger, in a statement.

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"However, Ginger's partnership with a market leader like Capsule not only improves convenience for our members, but provides vital feedback to our psychiatry team to provide the highest quality, evidence-based, patient-centered care," he said.

In late February, Maven, a virtual clinic for women’s and family health, announced it would begin offering fertility drug delivery to its members in a partnership with pharmacies Alto and SMP.

The drug delivery program, called MavenRx, will help address two of the more challenging aspects of the fertility journey: the high cost of fertility medications and complexity around managing a strict regimen, including self-administration of injections, Sonia Millsom, chief commercial officer at Maven, said in a statement.

By expanding into prescription drug delivery services, virtual care companies also are taking advantage of market opportunities among digital-savvy consumers, industry experts say.

"Targeting a specific user base and designing around their needs opens new markets. Healthcare is a latecomer to the consumer experience game, but it’s starting to catch up," Sari Kaganoff, Rock Health's general manager of consulting, told Fierce Healthcare.

"Disruptors are designing their platforms to attract and retain users whose expectations have been shaped outside of the healthcare industry. Moving away from one-size-fits-all, platform companies are identifying and addressing the specific needs and preferences of defined customer segments," Kaganoff said.

RELATED: Wellness brand Hims & Hers moving deeper into healthcare with Privia Health partnership

Standing out in the digital health space

The moves by Maven and Ginger speak to a larger trend in the digital health space. Conversely, digital pharmacies are also branching out to add virtual care services as they face growing competition from Amazon Pharmacy.  

Hims launched in 2017 with a narrow focus on four products, including prescriptions for erectile dysfunction medications. The company has since added a women’s health business, called Hers, that focuses on birth control, sexual health, and skin and hair care products.

Last spring, in response to the COVID-19 pandemic, Hims & Hers fast-tracked an expansion of its telehealth services to offer access to primary care and also rolled out online mental health services, starting with free support groups.

In January, the company went public in a blank check deal that values the company at about $1.6 billion.

Telehealth company Ro also started out three years ago selling erectile dysfunction medication and hair loss supplements to men. The company has since built out a telehealth company with three online health clinics, and now it wants to expand into remote monitoring for chronic conditions. It's also venturing into home-based healthcare market with its recent acquisition of software company Workpath.

"What makes the platform wars really interesting is the different business models in play—even amongst companies building similar platforms," Rock Health's Kaganoff said. "Who is paying for your services? What do you own—technology, hard assets or human capital? What IP are you building? The winners in the platform wars will make critical decisions within each pillar that support their own unique business model."

Some players in the digital pharmacy space are looking to outpace the competition by expanding into new prescription services. Thirty Madison, which offers telehealth visits and online prescriptions for drugs for hair loss, migraines and acid reflux, has added a new allergy care service. 

Called Picnic, the service offers a personalized treatment plan for allergies, a subscription service for at-home medication delivery and a care team of trained allergists to work with patients.

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"No matter where you are on your allergy care journey, gone are the days of scanning treatments in the drugstore aisle not knowing where to begin, or just pushing through your symptoms every year," said Alexis Tarlow, general manager for Picnic, in a statement.

"Picnic is built with a profound belief that high-quality, accessible, personalized care can and will help allergy sufferers find lasting relief," Tarlow said.

Women's health startup Nurx, which offers online birth control prescriptions, STI screenings and medication prescriptions, has branched out into at-home acne care.

More than half of Nurx’s current patients have told the medical team that they struggle with acne, and, because acne is often caused by hormonal fluctuations and treated with birth control, Nurx healthcare providers are uniquely qualified to help patients improve their skin, the company said.

“I’m passionate about expanding services across the spectrum of the female healthcare journey, and creating a telehealth platform that seamlessly meets women’s health needs throughout the different stages of their lives,” said Nurx Chief Medical Officer Jennifer Peña, M.D. 

There is a race and a massive opportunity for companies to become the destination healthcare platform as patient demand shifts online, said Lisa Wu, partner at Norwest Venture Partners, which invests in consumer-facing companies Calm and Ritual.

"Companies are competing to own the patient relationship by best serving them across the spectrum of conditions to capture share of mind and share of wallet. The winner(s) will have an intentional, three-pillar business-to-consumer (B2C), pharma and payor strategy," Wu said.