California-based GoodRx Inc. (“GoodRx”), an online and mobile app marketplace for discounts on prescription drugs, has acquired San Francisco-based telemedicine startup HeyDoctor LLC (“HeyDoctor”), an online platform that provides treatment, prescriptions, and lab tests from doctors for routine medical care. (Brown, Bloomberg; LaRock Business Insider). The combined company enables GoodRx to position itself solidly in the virtual health care market by providing HeyDoctor’s telemedical services to its vast network of loyal consumers.

Serial entrepreneur Doug Hirsch founded GoodRx in 2010 with the goal of providing a one-stop shop for prescription discounts and prices. (GoodRx). Since then, GoodRx estimates that its services have saved Americans $10 billion on prescription drugs, and the company has amassed an average of 10 million monthly users. (GoodRx). GoodRx was valued at $2.8 billion after Silver Lake Management LLC, a private equity firm, took a major stake in August. (Brown, Bloomberg). 

HeyDoctor was founded in 2017 by Brendan Levy and Rohit Malhotra with the goal of making it easier for physicians to connect with patients. (Dietsche, MedCity News). HeyDoctor distinguished itself from competitors in the telemedicine market by positioning itself as a replacement for a visit to urgent-care clinics. (Brown, Bloomberg). In the two years since its founding, HeyDoctor has conducted more than 100,000 virtual consultations with physicians for 18 medical issues including birth control, acne treatment, and HIV testing. (LaRock, Business Insider; Brown, Bloomberg). As of mid-2018, PitchBook valued HeyDoctor at approximately  $1.7 million. (Brown, Bloomberg).

While the terms of the deal were not disclosed, the acquisition allows GoodRx to access the growing telemedical market. The combined company, GoodRx Care, will compete with other new telehealth companies like Roman Medical LLC and Hims Inc. Unlike its competitors, however, GoodRx Care will not sell drugs directly. (Brown, Bloomberg). Instead, under the rebranded GoodRx Care, GoodRx will combine its prescription discount services with HeyDoctor’s services to offer treatments, lab tests, and prescriptions for routine medical issues though virtual connections between patients and doctors on its website and app platforms. (Brown, Bloomberg). Most visits under GoodRx Care will cost $20 without insurance and the company expects to grow the number of treatment services for a greater number of medical issues. (Brown, Bloomberg). 

The deal delivers HeyDoctor’s services directly to GoodRx’s vast client base and is simply another conglomeration in a growing trend of companies with large customer bases building telehealth programs to drive healthy adoption and retention rates. In late September, Amazon rolled out Amazon Care to provide virtual health care for its employees. (Farr, CNBC). While Amazon Care is currently employee-focused, future expansion beyond the pilot for its own employees to its astronomical client network is a major market opportunity. The telemedicine market is expected to hit $130 billion by 2025 with roughly half of the market, $64 billion, within the United States alone. (LaRock, Business Insider; Muoio, MobiHealthNews). As only seven out of 1,000 insured patients in the United States partook in a telemedicine visit in 2017 (LaRock, Business Insider), this valuation predicts a significant increase in consumer adoption as major companies with loyal consumers, like GoodRx Care, position themselves to provide fast, low-cost, virtual care.